Company Number: 13916216

Analysis Date: 2025-07-29 18:05 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns, with large and growing net current liabilities and net negative equity over multiple years. These factors present a high risk for investors regarding the company's ability to meet its obligations and sustain operations.

2. Key Concerns:

• Severe Negative Net Current Assets: Net current liabilities increased substantially from £269k in 2023 to £514k in 2024, indicating worsening short-term liquidity stress.
• Negative Shareholders’ Funds: Equity deteriorated from -£266k in 2023 to -£509k in 2024, reflecting accumulated losses and erosion of capital, which threatens solvency.
• Large Related Party Borrowings: The company owes over £603k to ECLS Group Limited (a related party), raising concerns about dependency on intra-group financing and potential creditor risk concentration.

3. Positive Indicators:

• Timely Compliance: All statutory filings, including accounts and confirmation statements, are up to date with no overdue filings noted, indicating good regulatory compliance.
• Active Website and Contact Details: The company maintains an active website and public contact information, suggesting operational transparency and customer accessibility.
• Clear Accounting Policies and Going Concern Statement: Directors acknowledge going concern status and have provided detailed accounting policies in line with applicable standards.

4. Due Diligence Notes:

• Investigate the nature and terms of the related party loans, particularly the £603k owed to ECLS Group Limited, including repayment schedules and interest arrangements.
• Review cash flow forecasts and management plans addressing the increasing net current liabilities and negative equity to assess the company’s viability.
• Examine the reasons behind the rapid increase in current liabilities and stock reductions to understand operational or financial pressures.
• Evaluate the business model, especially the "no win, no fee" revenue recognition, for potential impacts on cash flows and revenue certainty.
• Confirm the identity and background of key directors and controlling parties to assess governance and management stability given recent director turnover.