COSMOS BRUTON LTD

Executive Summary

Cosmos Bruton Ltd remains financially weak with persistent negative equity and working capital deficits, despite a recent reduction in liabilities following disposal of investment property. The company depends heavily on related party loans for liquidity, with no clear operational cash inflow to support debt servicing. Given these factors, credit extension is not recommended at this time.

COSMOS BRUTON LTD - Analysis Report

Company Number: 13356808

Analysis Date: 2025-07-20 17:25 UTC

1. Credit Opinion: DECLINE
   Cosmos Bruton Ltd exhibits significant financial distress as evidenced by persistent negative net assets and shareholders' funds over multiple years. The company shows a history of large current liabilities far exceeding current assets, and its financial position has only marginally improved in the latest year. The negative equity position and reliance on interest-free loans from related parties underscore weak financial resilience and raise significant repayment risk. Without evidence of sustainable cash inflows or improved liquidity, extending credit is inadvisable.

2. Financial Strength:
   The company’s balance sheet is weak, with net current liabilities of £1,397 as of 31 March 2024, albeit a major improvement from the previous years where liabilities exceeded £700k. The absence of fixed assets in 2024 (investment property disposed of) removes a key asset base. Shareholders’ funds remain negative at £1,497, indicating accumulated losses and insufficient capital. The shortfall in net assets and elevated creditors position reveal ongoing solvency concerns.

3. Cash Flow Assessment:
   Liquidity is constrained, with current assets limited to minimal debtors (£100) and no cash reported. Current liabilities stand at £1,497, covered only by related party loans, which are interest-free and thus potentially informal. The company’s working capital deficit points to an inability to meet short-term obligations from operational cash flows. The note on related party loans suggests reliance on shareholder support rather than independent cash generation.

4. Monitoring Points:

• Watch for improvements in net current assets and reduction of current liabilities.
• Monitor cash balances and operational cash flow generation for signs of sustainable liquidity.
• Track any new borrowings and repayment terms, especially from related parties.
• Review any changes in investment property holdings or asset base that could strengthen the balance sheet.
• Observe director conduct and any filings for indications of restructuring or financial distress.