ECOSOLV SCAFFOLDING LTD
Executive Summary
ECOSOLV SCAFFOLDING LTD is a recently formed micro-entity with modest net assets but a slight working capital deficit and material long-term creditor obligations. While regulatory compliance is current and governance appears stable, limited financial history and short-term liquidity pressures represent moderate risks. Further diligence on creditor terms, cash flow, and operational contracts is recommended to clarify financial stability and sustainability.
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This analysis is opinion only and should not be interpreted as financial advice.
ECOSOLV SCAFFOLDING LTD - Analysis Report
Risk Rating: MEDIUM
The company is newly established (incorporated in Feb 2023) and holds net assets of £58,376. However, it shows a negative net working capital position (current liabilities slightly exceeding current assets) and a significant long-term creditor balance of £50,000. These factors introduce moderate solvency and liquidity risks typical for a micro-entity in its startup phase.Key Concerns:
- Negative net current assets (working capital deficit of £115) indicating potential short-term liquidity pressure to meet immediate obligations.
- Material creditor amounts falling due after more than one year (£50,000) which suggests reliance on external financing or deferred payments that must be managed prudently.
- Limited financial history with only one 13-month accounting period completed, making it difficult to assess operational sustainability or profitability trends.
- Positive Indicators:
- Positive net assets of £58,376, demonstrating some equity buffer and initial capitalization.
- Compliance with filing deadlines; last accounts and confirmation statement are up to date, indicating good regulatory compliance.
- Employment of 5 staff suggests some operational activity and potential for scaling in the scaffold erection sector (SIC 43991).
- Directors are resident and have no disqualifications noted, supporting governance stability.
- Due Diligence Notes:
- Review the nature and terms of the £50,000 long-term creditors to assess repayment risk and impact on cash flows.
- Obtain management accounts or cash flow forecasts to evaluate current liquidity and operational cash generation.
- Investigate business contracts or pipeline to gauge revenue visibility and growth prospects for scaffold erection services.
- Confirm no undisclosed contingent liabilities or off-balance-sheet arrangements despite current disclosures.
- Monitor director changes and related party transactions given recent director appointment and resignation activity.
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