COFFEE TIME BY MBM LTD

Executive Summary

COFFEE TIME BY MBM LTD demonstrates significant financial distress with substantial negative equity and working capital deficits, raising concerns about its ability to meet obligations. Despite timely statutory compliance and modest operational activity, the company's financial structure suggests elevated solvency and liquidity risks. Further investigation into liabilities, cash flow, and management plans is advised to assess viability.

COFFEE TIME BY MBM LTD - Analysis Report

Company Number: 13953919

Analysis Date: 2025-07-29 20:41 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency concerns with negative net assets and net current assets worsening materially from the previous year. The liabilities substantially exceed current assets, indicating high risk of inability to meet short-term obligations.

2. Key Concerns:

• Severe Negative Equity: Shareholders' funds and net assets stand at approximately -£72k, a steep decline from -£10k the prior year, signifying accumulated losses and potential insolvency risk.
• Negative Working Capital: Current liabilities (£74,906) far exceed current assets (£2,567), resulting in a net current liability position of -£72,339, raising liquidity and cash flow concerns.
• Small Scale and Limited Financial Disclosure: As a micro/small entity filing unaudited abridged accounts, detailed financial or operational information is not available, limiting transparency on revenue, profitability or cash flow generation.

3. Positive Indicators:

• Compliance and Filing Status: The company is up to date with statutory filings including accounts and confirmation statements, showing no regulatory non-compliance.
• Active Business Activity: The company has increased its workforce from 2 to 4 employees, indicating some operational activity and potential growth.
• Single Controlling Shareholder: Ownership and control are consolidated under one director, potentially allowing swift decision-making and strategic control.

4. Due Diligence Notes:

• Investigate the nature and timing of the liabilities causing the large current liabilities balance and whether any repayment plans or creditor negotiations are in place.
• Assess the company’s revenue streams, profitability, and cash flow projections as these are not disclosed, to understand sustainability and turnaround potential.
• Examine the director’s plans or additional capital injections to address the negative equity and working capital deficits.
• Confirm no undisclosed related party transactions or contingent liabilities exist which might exacerbate financial risk.