CPC OFFICE SUPPLIES LIMITED

Executive Summary

CPC Office Supplies Limited presents a weak financial profile characterized by persistent negative working capital, limited equity, and low cash reserves, raising concerns about its ability to meet short-term obligations. The company’s financial transparency is limited, and no clear improvement in liquidity or profitability is evident. Consequently, credit exposure to this company carries elevated risk, and approval is not recommended without significant mitigating factors.

CPC OFFICE SUPPLIES LIMITED - Analysis Report

Company Number: NI684151

Analysis Date: 2025-07-29 14:46 UTC

1. Credit Opinion: DECLINE - CPC Office Supplies Limited shows persistent net current liabilities and negative working capital for the last two reported years. Current liabilities exceed current assets by approximately £83k in 2023, indicating liquidity pressure and potential difficulty in meeting short-term obligations. Although the company is active and has no overdue filings, the small equity base (£9k) and minimal share capital (£100) provide limited buffer against shocks. The company is relatively new (incorporated in late 2021) and has not demonstrated growth or improved liquidity trends. The absence of an income statement and lack of audit further limit transparency. Given these factors, the risk of default or financial stress appears elevated.

2. Financial Strength: The balance sheet shows total assets slightly above £329k (mainly fixed assets of £95k and current assets of £234k) offset by substantial current liabilities of £318k, resulting in net current liabilities of £83k and net assets of just £9k. The company’s fixed assets include goodwill amortised over 10 years, which suggests acquisition activity but intangible assets do not represent liquid value. The company’s equity position is weak with retained losses reflected in low shareholders’ funds. There is no indication of long-term borrowings, which reduces gearing risk, but also shows reliance on short-term creditor funding. Overall, financial strength is weak with limited reserves and insufficient liquidity.

3. Cash Flow Assessment: Cash on hand at the year-end is only £12,841, sharply down from £51,463 the previous year, indicating cash depletion. Debtors are high (£170k) but the company’s ability to convert receivables into cash timely is unclear. Trade payables and amounts owed to group undertakings total £270k+, indicating reliance on supplier and related party credit. Negative working capital and ongoing amortisation expenses suggest cash flow strain. The company’s limited cash buffer and high current liabilities raise concerns about short-term liquidity and operational funding. Without clear evidence of positive operating cash flow, there is a risk of payment delays or reliance on external support.

4. Monitoring Points:

• Monitor working capital trends and efforts to reduce net current liabilities.
• Track cash balances and receivables ageing to assess liquidity improvements.
• Review payment patterns to suppliers and related parties for signs of stress.
• Watch for updated accounts including profit and loss statements for profitability insight.
• Confirm director and shareholder support remains consistent for ongoing operations.
• Assess any changes in company size, employee numbers, or business model impacting financial health.