CHEETHAM & MORTIMER LTD

Executive Summary

Cheetham & Mortimer Ltd is an active private real estate agency company with improving working capital and profitability but limited operating history. While the company remains solvent with no regulatory filing issues, liquidity fluctuations and governance concentration present risks warranting further due diligence. Overall, the company demonstrates moderate investment risk with positive operational trends balanced by caution on cash management and control structure.

CHEETHAM & MORTIMER LTD - Analysis Report

Company Number: 13646030

Analysis Date: 2025-07-20 14:00 UTC

1. Risk Rating: MEDIUM
   The company shows a strengthening net current asset position and positive retained earnings, but its recent rapid reduction in current liabilities and significant year-on-year cash decrease warrant cautious monitoring. The absence of an audit and limited operational history since incorporation also suggest moderate risk.

2. Key Concerns:

• Liquidity Volatility: Cash reserves declined from £218k to £162k despite reduced liabilities, indicating possible cash flow strain or operational cash burn.
• Limited Operational History: Incorporated in late 2021 with only two years of financial data; this restricts trend analysis and increases uncertainty about sustainable profitability.
• Significant Concentration of Control: One individual owns 75-100% of shares and controls appointment/removal of directors, which may pose governance and succession risks.

3. Positive Indicators:

• Improved Working Capital: Net current assets increased from £21k to £95k year-on-year, reflecting better short-term solvency.
• Profitability Evident: Retained earnings rose substantially to £94.6k after dividends, showing operational profit generation.
• Up-to-date Filing Compliance: No overdue accounts or confirmation statements, demonstrating regulatory compliance and governance discipline.

4. Due Diligence Notes:

• Investigate causes behind the sharp decrease in debtors and current liabilities to assess sustainability of working capital improvements.
• Review the cash flow statement and forecast to understand the cash depletion despite profit recognition.
• Confirm governance practices given the high concentration of ownership and director control, including checks on related party transactions.
• Consider obtaining audited accounts or more detailed financial disclosures to validate unaudited figures and accounting policies applied.