DU TOIT NETWORKS LIMITED

Executive Summary

Du Toit Networks Limited is a newly formed micro company with a positive equity base and modest working capital, currently supported by director advances. While its financial position is stable at inception, the limited trading history and reliance on owner funding warrant a cautious credit approach. Conditional approval is advised with ongoing monitoring of financial performance and cash flow development.

DU TOIT NETWORKS LIMITED - Analysis Report

Company Number: SC749282

Analysis Date: 2025-07-29 17:41 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Du Toit Networks Limited is a recently incorporated micro-entity operating in a niche professional and technical activity sector. The company shows a positive net asset position with modest working capital, indicating an initial stable financial footing. However, as a start-up with only one employee and limited operating history, there is inherent uncertainty about future cash flows and profitability. The director has advanced funds to the company (£3,572), which suggests reliance on owner financing at this stage. Credit approval is recommended on a conditional basis, subject to monitoring of trading performance and timely filing of future accounts to confirm business viability and repayment capacity.

2. Financial Strength:
   The balance sheet as of 30 November 2023 shows total assets less current liabilities of £4,508, entirely funded by shareholder equity with no long-term liabilities. Fixed assets are minimal (£640), typical for a service-oriented micro company. Net current assets stand at £3,868, reflecting a positive working capital position and short-term liquidity buffer. The absence of debt limits financial risk but also indicates the company is currently reliant on equity and director advances to fund operations. Overall, the financial structure is sound for a start-up but limited in scale.

3. Cash Flow Assessment:
   Current assets of £6,892 against current liabilities of £3,024 provide a current ratio of approximately 2.3:1, which is healthy and suggests the company can meet short-term obligations. However, there is no detailed cash flow statement available, and the company’s cash generation capacity remains unproven given its early stage. The director’s loan of £3,572 indicates internal funding support, but absence of repayments points to limited cash inflows from trading so far. Close attention to cash conversion cycles, debtor collection, and expense management will be vital.

4. Monitoring Points:

• Future annual accounts to assess revenue growth, profitability, and cash flow trends.
• Director’s loan account movements to understand funding reliance and repayment plans.
• Timely submission of statutory filings to avoid compliance risks.
• Changes in working capital components, especially receivables and payables.
• Any new borrowings or external financing that may impact leverage and liquidity.