Company Number: 14253077

Analysis Date: 2025-07-20 14:10 UTC

1. Risk Rating: LOW to MEDIUM
   The company demonstrates a solid equity base with shareholders' funds increasing from £889,618 in 2023 to £1,385,339 in 2024. Current liabilities are modest (£38,759) compared to current assets (£331,169), indicating good short-term liquidity. However, cash at bank has decreased significantly from £514,937 in 2023 to £129,680 in 2024, which may warrant monitoring.

2. Key Concerns:

• Decline in Cash Reserves: The drop in cash from over £500k to around £130k within one year could suggest increased operational cash outflows or investment, raising potential short-term liquidity concerns despite healthy net current assets.
• Negative Retained Earnings: Retained earnings remain negative (£(869,546) in 2024), indicating accumulated losses which could impair ability to absorb future losses or fund growth internally.
• Concentration of Control: The two directors, each owning between 25-50% shares and voting rights, hold significant control. While not inherently risky, this concentration may limit external governance oversight.

3. Positive Indicators:

• Strong Shareholders' Funds Growth: Equity increased substantially (£1.39m in 2024 vs. £0.89m in 2023), reflecting capital injections or accumulated reserves which bolster solvency.
• Net Current Assets Strong: Net current assets remain positive and substantial (£292,410), implying the company can meet short-term obligations comfortably.
• No Overdue Filings: The company is compliant with statutory filing deadlines for both accounts and confirmation statements, indicating good governance and adherence to regulatory requirements.
• Business Sector: Engaged in research and experimental development (SIC 72190), which may have potential for growth and innovation-driven value creation.

4. Due Diligence Notes:

• Investigate reasons behind the large reduction in cash balances during the year; assess cash flow statements if available.
• Clarify the nature and sustainability of operations given negative retained earnings despite equity growth.
• Review any related party transactions, especially given significant shareholdings and appointments of directors residing in different countries.
• Assess lease commitments (£132,387 over future years) and their impact on cash flow and operational flexibility.
• Confirm that the absence of an audit (exemption claimed) does not hide any material issues; consider requesting audited or more detailed financials if investing.