Company Number: 13658413

Analysis Date: 2025-07-19 11:52 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Chi x Chi Limited is a relatively new, small private limited company operating in management consultancy. The company shows a decline in net assets and working capital from 2023 to 2024, with net current liabilities of £1,974 in 2024 compared to net current assets of £9,620 in 2023. This indicates liquidity pressure and a weakening short-term financial position. However, the absence of overdue filings and the presence of experienced directors with significant shareholding provide governance stability. Approval is recommended subject to close monitoring of liquidity and cash flow, and potentially requiring additional collateral or guarantees if credit limits are extended.

2. Financial Strength:
   The company’s net assets decreased from £33,425 in 2023 to £18,155 in 2024, a significant drop primarily driven by a sharp decline in current assets (mainly cash falling from £22,783 to £11,903) while current liabilities remained steady (~£14,134). Fixed assets are modest (£20,129) and are depreciating as expected. Shareholders’ funds have also declined, reflecting accumulated losses or distributions not detailed here. The balance sheet remains positive but shows clear signs of stress in working capital management, indicative of either increased short-term liabilities or decreased operating cash inflows.

3. Cash Flow Assessment:
   Cash at bank reduced by almost half over the year, which combined with current liabilities exceeding current assets, signals potential liquidity constraints. Debtors are minimal (£257), indicating limited receivables risk but also potentially low ongoing sales or slow revenue recognition. The company’s ability to meet short-term obligations without additional funding may be compromised unless cash inflows improve. Working capital management needs improvement to ensure smooth operations and debt servicing capability.

4. Monitoring Points:

• Monthly cash flow and liquidity trends to detect early warning signs of shortfalls.
• Receivables ageing and turnover to assess collection efficiency and revenue sustainability.
• Profitability trends once P&L data is available to confirm if losses are temporary or structural.
• Directors’ compliance with filing deadlines and any changes in management or ownership stakes.
• Any new debt or credit facility drawdowns that may impact leverage and repayment capacity.