CREEVY HOUSE FARM LTD

Executive Summary

Creevy House Farm Ltd shows stable equity and improved liquidity, supporting a cautious credit approval with conditions. The company’s financial position is typical for a micro farming business, with manageable working capital but significant long-term liabilities. Close monitoring of cash flow, debt repayment, and sector-specific risks is recommended to ensure ongoing creditworthiness.

CREEVY HOUSE FARM LTD - Analysis Report

Company Number: NI678016

Analysis Date: 2025-07-29 19:03 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Creevy House Farm Ltd demonstrates a stable equity base and positive net assets, reflecting modest financial resilience suitable for a micro-entity. However, the company’s working capital position, while positive in the latest year, showed liquidity constraints previously, and current liabilities due after one year remain high relative to fixed and current assets. Given the sector (dairy cattle raising) and the company’s small scale, credit approval is recommended with conditions: ongoing monitoring of liquidity and debt servicing ability is essential, and any credit facility should be structured conservatively with clear covenants on working capital and debt levels.

2. Financial Strength:
   The balance sheet shows net assets of £122,034 as of 31 March 2024, up slightly from £121,196 in 2023, indicating stable equity. Fixed assets remain substantial (£376,487) and consistent with a farming operation’s capital base. The company has a significant level of long-term creditors (£282,971), which suggests reliance on external finance or loans to support operations. Current assets (£82,042) exceed current liabilities due within one year (£53,524), giving positive net current assets of £28,518, a strong improvement from the previous year’s net current liability position (-£5,194). Overall, the company’s financial strength is sound for a micro business but constrained by its relatively high debt load.

3. Cash Flow Assessment:
   Liquidity has improved from a negative working capital position in the previous years to a positive £28,518 as of the latest year-end, signaling better short-term cash flow management. The company employs only 1 person on average, indicating limited payroll obligations. However, current liabilities remain significant relative to current assets, and the large amount of creditors due after one year suggests potential future cash outflows that must be managed carefully. No audit or detailed cash flow statement is available, so a cautious approach to liquidity risk is warranted.

4. Monitoring Points:

• Working capital trends: Ensure net current assets remain positive and sufficient to cover short-term obligations.
• Debt servicing: Monitor creditor repayments, especially long-term creditors, to assess ability to meet scheduled payments.
• Profitability and reserves: Track any changes in retained earnings or losses that could impact equity.
• Sector risks: Dairy farming is exposed to commodity price volatility and regulatory changes; management’s response to these risks should be reviewed.
• Director involvement: Directors have relevant sector and professional backgrounds (farming and hospital consultant), but credit risk should consider their active management capability and commitments.