Company Number: 13745903

Analysis Date: 2025-07-29 12:48 UTC

1. Credit Opinion: DECLINE
   EPIC BARBERS LIMITED exhibits alarming financial deterioration over the last reported year ending November 2023. The net assets have plunged from a positive £1,352 in 2022 to a significant negative £40,985 in 2023, indicating insolvency on the balance sheet. The company’s current liabilities (£52,500) now substantially exceed current assets (£3,515), leading to a negative working capital of £48,985. This suggests severe liquidity stress and inability to meet short-term obligations without additional capital injection or restructuring. The absence of audit and reliance on micro-entity accounts limits transparency but does not mitigate the evident financial weakness. Given these factors, the risk of default is high, and the company’s capacity to service any new or existing credit facilities appears highly compromised.

2. Financial Strength:
   The balance sheet shows a concerning shift from marginal positive net assets in 2021 and 2022 to a large net liability position in 2023. Fixed assets are minimal (£6,000) and do not provide substantial collateral coverage. The sharp drop in current assets from £42,142 in 2022 to £3,515 in 2023, against rising current liabilities, illustrates rapid deterioration in liquidity and working capital management. Shareholders’ funds are negative, reflecting accumulated losses or possibly increased liabilities. The micro-entity status and small employee base (3 employees) suggest limited scale and operational capacity, making recovery challenging without external support.

3. Cash Flow Assessment:
   The reported data lack detailed cash flow statements, but the balance sheet indicates critical liquidity issues. The large negative net current assets imply the company is unable to cover short-term debts with available liquid resources. No evidence of cash reserves or receivables to mitigate this gap is apparent. The negative working capital position means the company may depend on further borrowing or owner funding to continue operations. Without improvement in cash inflows or debt restructuring, the company’s cash flow position is unsustainable.

4. Monitoring Points:

• Watch for improvements in current assets and reductions in current liabilities in the next reporting period.
• Monitor the directors’ actions regarding capital injections or refinancing to restore solvency.
• Review any changes in share capital or external funding arrangements.
• Track the company’s ability to generate positive cash flows from operations, especially in the context of its hairdressing industry which can be sensitive to economic cycles.
• Observe any director or related party transactions that may affect financial stability.