CHICHESTER ST PUBS LTD

Executive Summary

Chichester St Pubs Ltd has shown a robust financial recovery from earlier losses with strong cash reserves and positive net assets, supporting a healthy liquidity position. The company's profitability and working capital strength underpin its capacity to service new credit facilities. Continued monitoring of cash flow and director advances is recommended to maintain this positive credit profile.

CHICHESTER ST PUBS LTD - Analysis Report

Company Number: NI645876

Analysis Date: 2025-10-21 12:51 UTC

1. Credit Opinion: APPROVE
   Chichester St Pubs Ltd demonstrates strong financial performance and significant improvement over recent years. The company has turned around historic losses and is currently profitable with steadily growing equity. Given the substantial positive net current assets and healthy cash position, the company presents a low risk for lending. The director holds full ownership and seems actively engaged, which is a positive indicator of management commitment. No filing or status issues raise concern. The business operates in the public house sector, which can be sensitive to economic cycles but currently shows resilience.

2. Financial Strength:

• Net assets have grown from a negative position of £-40k in 2019 to £408k in 2024, indicating a strong turnaround and improved capitalization.
• Fixed assets at £39k are low relative to current assets, suggesting a business model not highly reliant on heavy investment in fixed assets but rather on working capital.
• Shareholders' funds align with net assets, reflecting retained earnings accumulation of £408k, confirming sustained profitability and retained profits reinvested in the business.

3. Cash Flow Assessment:

• The company holds £517k in cash, which covers nearly double the current liabilities of £262k, indicating excellent liquidity to meet short-term obligations.
• Current assets of £653k versus current liabilities of £262k generate a strong positive working capital of £390k, supporting operational sustainability and reducing liquidity risk.
• Debtors are relatively moderate (£101k), with no indication of impairment, while trade creditors have increased, suggesting active procurement and good trade credit practices.
• Director advances of £60k indicate some degree of director funding involvement, which can be a positive sign of backing but should be monitored for repayment terms.

4. Monitoring Points:

• Monitor ongoing profitability trends and cash flow generation, particularly given the pub industry's sensitivity to regulatory changes and economic conditions.
• Review debtor aging and creditor payment terms regularly to ensure working capital efficiency is maintained.
• Keep track of director advances to ensure no undue reliance on director funding long term.
• Vigilance over tax liabilities, which have increased notably, to avoid potential cash flow pressure.
• Monitor any sector-specific risks such as changes in consumer behavior or licensing impacting revenues.