Company Number: SC686646

Analysis Date: 2025-07-29 16:16 UTC

1. Risk Rating: HIGH
   The company shows significant negative net assets and net current liabilities which indicate solvency and liquidity challenges. The continued erosion of shareholders’ funds over three years is a strong red flag.

2. Key Concerns:

• Negative Net Assets: The company has net assets of -£14,302 as of the latest accounts, worsening from -£6,805 the prior year, reflecting accumulated losses exceeding equity.
• Negative Working Capital: Current liabilities (£32,109) exceed current assets (£16,116) by nearly £16k, suggesting the company may struggle to meet short-term obligations.
• Dependence on Finance Leases: Substantial long-term liabilities (£18,083) are tied to finance leases/hire purchase contracts, indicating ongoing fixed debt commitments with diminishing asset backing.

3. Positive Indicators:

• Timely Filings: The company is up to date on both accounts and confirmation statement filings with no overdue notices, showing regulatory compliance.
• Single Director Control: Clear ownership and control by a single director (Mr Dragomir Petkov) may facilitate decisive management actions.
• Modest Asset Base: The company holds tangible fixed assets (motor vehicles) valued at just under £20k, which support some operational capacity.

4. Due Diligence Notes:

• Review Cash Flow Statements: Assess cash flow trends to determine if operational cash generation is sufficient to service liabilities and finance lease payments.
• Understand Causes of Losses: Investigate the business model and income statements to clarify why losses are accumulating and if turnaround plans are in place.
• Assess Lease Terms: Examine finance lease agreements for covenants, payment schedules, and potential refinancing risks.
• Confirm Customer Base and Contracts: Given the SIC codes (unlicensed carrier, software development, other services), verify revenue streams and client stability.
• Director Background Check: Although no disqualifications are noted, further review of the director’s track record and financial capacity may be prudent.