Company Number: 13453454

Analysis Date: 2025-07-29 18:13 UTC

1. Risk Rating: MEDIUM
   The company demonstrates positive net assets and an improving equity position; however, there are concerns regarding increasing current liabilities and finance lease obligations which may pressure liquidity.

2. Key Concerns:

• Rising Current Liabilities: Current liabilities increased from £719,805 in 2023 to £912,089 in 2024, mainly trade payables and taxation, which could strain short-term cash flows.
• Significant Finance Lease Obligations: Creditors due after one year comprise finance leases of £181,015, up from £117,306, indicating increased long-term financing commitments that add leverage risk.
• Declining Debtors Balance: Trade debtors decreased from £775,946 in 2023 to £625,266 in 2024, potentially indicating slower revenue collection or reduced sales, warranting scrutiny of cash conversion cycle.

3. Positive Indicators:

• Growing Net Assets and Shareholders’ Funds: Equity increased from £237,404 in 2023 to £320,796 in 2024, reflecting retained earnings and improved capital base.
• Healthy Cash Position: Cash at bank rose substantially from £55,231 to £347,887, enhancing liquidity.
• Compliance and Timely Filings: Accounts and confirmation statements are up to date with no overdue filings, indicating good regulatory compliance and governance.
• Expansion of Fixed Assets: Net fixed assets more than doubled from £187,140 to £424,753, suggesting investment in operational capacity.

4. Due Diligence Notes:

• Investigate the nature and terms of finance lease obligations to assess repayment schedules and impact on cash flow.
• Review debtor aging analysis to evaluate collection efficiency and potential credit risk concentration.
• Analyze the reasons behind the increase in trade payables and tax liabilities to determine if these are timing issues or indicative of cash flow stress.
• Confirm the ongoing operational profitability and revenue trends given the reduction in debtors and fluctuations in liabilities.
• Verify director appointments, particularly the recent appointment dated January 2025, to understand management changes and their impact on strategy.