CURRAN CONTRACTS ARMAGH LTD

Executive Summary

Curran Contracts Armagh Ltd shows clear liquidity and solvency risks driven by significant negative working capital and a large directors’ creditor balance. While asset investments and increased equity are positive signs, the company’s ability to meet short-term obligations appears strained. Further analysis of cash flows, creditor arrangements, and operational performance is essential before considering investment.

CURRAN CONTRACTS ARMAGH LTD - Analysis Report

Company Number: NI681149

Analysis Date: 2025-07-20 17:28 UTC

1. Risk Rating: HIGH

Justification: The company exhibits significant liquidity concerns with net current liabilities of £356,518 as of July 2023, indicating an inability to cover short-term obligations from current assets. This is coupled with a consistent pattern over multiple years of current liabilities exceeding current assets by a substantial margin. Although the company holds considerable fixed assets, the heavy reliance on directors' current accounts as creditor balances may indicate cash flow stress or informal financing arrangements. These factors suggest elevated solvency and liquidity risks.

2. Key Concerns:

• Negative net working capital: Current liabilities (£540,369) far exceed current assets (£183,851), pointing to potential difficulties meeting short-term debts.
• Heavy creditor balance in directors' current accounts (£379,826), which may represent loans or deferred payments to directors rather than third-party funding.
• Declining trade debtor balance from £140,218 to £92,720 year-on-year, which could indicate collection issues or reduced sales.

3. Positive Indicators:

• The company has increased its tangible fixed assets to over £500k, demonstrating investment in plant and machinery that may support operational capacity and future revenue generation.
• Shareholders’ funds have increased from £28,895 in 2022 to £149,912 in 2023, suggesting some retained earnings growth or capital injection.
• The company is up to date with its statutory filings and accounts, indicating compliance with regulatory requirements.

4. Due Diligence Notes:

• Investigate the nature and terms of the directors’ current accounts creditor balance to understand if this is sustainable funding or a red flag for financial distress.
• Review cash flow statements and profit & loss accounts (not provided) to assess operational performance and true liquidity position.
• Examine debtor aging reports to evaluate risks related to trade receivables and potential bad debts.
• Confirm whether the fixed assets are fully operational and contributing to revenue generation or if they represent stranded assets.
• Assess customer concentration and contract stability given the specialized construction niche to understand revenue sustainability.