CGGD LTD

Executive Summary

CGGD Ltd is a newly formed specialised design company with a modest but solvent balance sheet. While net current assets are positive, low cash reserves and reliance on inventory and debtors present liquidity risks. Credit approval is recommended on a conditional basis with careful monitoring of cash flow, debtor collections, and inventory management.

CGGD LTD - Analysis Report

Company Number: 14692225

Analysis Date: 2025-07-29 12:08 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   CGGD Ltd is a newly incorporated private limited company specializing in specialised design activities (SIC 74100). The company has filed its first set of accounts for a 12-month period ending 28 February 2024. The financial data shows positive net current assets, indicating some working capital buffer, but the overall scale is modest. Given the short trading history and relatively low cash reserves, credit approval should be conditional on ongoing monitoring of cash flow and debtor collections to ensure the company can meet its short-term obligations.

2. Financial Strength:
   The balance sheet at 28 February 2024 shows total current assets of £101,485, primarily comprising stock (£65,000) and debtors (£35,033), with a modest cash balance of £1,452. Current liabilities stand at £89,015, resulting in net current assets of £12,470 and shareholders’ funds of the same amount. The company holds no fixed assets. The positive net current assets and equity indicate a solvent position, but reliance on stock and debtors means asset liquidity could be a concern if turnover slows or collections weaken.

3. Cash Flow Assessment:
   Cash at bank is low (£1,452), which suggests limited immediate liquidity. The company has a working capital surplus (£12,470), but this is driven mostly by inventory and receivables rather than cash. This structure may constrain the company's ability to quickly meet liabilities falling due within one year (£89,015). The debtor days and stock turnover rates are not disclosed, so assessing cash conversion cycles is difficult. Close attention should be paid to the conversion of debtors and stock into cash to maintain liquidity.

4. Monitoring Points:

• Debtor ageing and collection efficiency to avoid bad debts and ensure timely cash inflows.
• Inventory turnover to prevent stock obsolescence and tied-up working capital.
• Cash flow forecasts and actual cash balances to ensure sufficient liquidity for operational needs.
• Profitability trends once income statements are filed to assess sustainable earnings capacity.
• Any changes in director or shareholder control, given both directors hold significant shares and voting rights (25-50% each).
• Timely filing of future annual accounts and confirmation statements to monitor regulatory compliance.