CPJ WATKINS CONSTRUCTION LTD

Executive Summary

CPJ Watkins Construction Ltd shows solid financial growth since incorporation with strong liquidity and a healthy balance sheet supported by increasing tangible assets and cash reserves. The company’s financial position and shareholder equity indicate a good capacity to meet credit commitments. Continued monitoring of debtor quality and working capital dynamics is recommended to maintain this positive outlook.

CPJ WATKINS CONSTRUCTION LTD - Analysis Report

Company Number: 14076062

Analysis Date: 2025-07-29 21:15 UTC

1. Credit Opinion: APPROVE
   CPJ Watkins Construction Ltd, a private limited company incorporated in 2022, demonstrates strong financial progress in its second full year with significant growth in net current assets and shareholders’ funds. The company has a healthy working capital position and positive equity, indicating sound financial stewardship by the sole director and significant control holder. Given the absence of overdue filings, no liquidation or administration status, and a clear increase in cash reserves, the company appears capable of servicing credit facilities. However, as a young company, ongoing monitoring is prudent.

2. Financial Strength:
   The balance sheet reveals a growing asset base, with tangible fixed assets nearly doubling from approximately £46k in 2023 to £91k in 2024, reflecting investment in plant and machinery. Current assets increased substantially from £52.5k to £227k, largely driven by cash increasing from £31k to £171k and debtors rising to £56k. Current liabilities rose to £155k but remain comfortably covered by current assets, leading to net current assets of £71.9k (2023: £14k). Shareholders’ funds have grown from £60.4k to £162.9k, indicating retained earnings and capital accumulation. The company’s capital base is modest (£150 share capital), but its reserves and asset base provide a solid buffer.

3. Cash Flow Assessment:
   Cash holdings and liquidity have improved markedly, with a healthy cash balance of £170,691 as at June 2024. The company’s net current assets show positive working capital, supporting operational liquidity. Debtor levels are moderate but should be monitored to ensure timely collection, especially given that £56k is owed by group undertakings or related parties, which can sometimes present collection risk. Creditors have increased but are well-covered by current assets. Overall, cash flow appears adequate for meeting short-term obligations.

4. Monitoring Points:

• Debtor composition and ageing, particularly related party balances, to ensure cash inflows are timely and reliable.
• Growth in current liabilities, especially tax and social security, which almost tripled from £30.6k to £82k, to avoid liquidity strain.
• Continued investment in fixed assets and its impact on cash flow and profitability.
• Profitability metrics once full profit & loss information becomes available, as current data excludes detailed income statement figures.
• Compliance with filing deadlines to avoid penalties and maintain good standing.