EQ CONTRACTS LTD

Executive Summary

EQ CONTRACTS LTD presents a financially robust profile with strong liquidity, profitability, and compliance track record, indicating low risk of insolvency or liquidity issues. The company’s concentrated ownership and director advances warrant focused due diligence, alongside careful monitoring of growing tax liabilities. Overall, the business shows operational stability and prudent financial management suitable for investor confidence.

EQ CONTRACTS LTD - Analysis Report

Company Number: NI667994

Analysis Date: 2025-07-29 20:54 UTC

1. Risk Rating: LOW
   EQ CONTRACTS LTD demonstrates solid financial health with increasing net assets, strong net current assets, and a robust cash position. The company is compliant with filing deadlines and shows steady profit growth, indicating low solvency and liquidity risk.

2. Key Concerns:

• Concentration of Control: Two individuals each hold 25-50% share ownership, which could pose governance risks if disagreements arise.
• Director Advances: The director has a material outstanding balance (£19,971) owed to the company, which requires monitoring for potential related party risks.
• Tax Liabilities: Corporation tax creditors have increased significantly (£79,055 in 2025), indicating sizeable tax obligations that must be managed carefully.

3. Positive Indicators:

• Strong Liquidity: Cash at bank (£400,436) and net current assets (£366,274) comfortably exceed current liabilities, indicating capacity to meet short-term obligations.
• Profitability and Equity Growth: Consistent profits (£236,701 in 2025) and rising shareholders’ funds (£458,228) over recent years show operational stability and retained earnings growth.
• Filing Compliance: No overdue accounts or confirmation statements, showing good regulatory compliance and governance.
• Asset Base Growth: Fixed assets have increased substantially (from £52,201 to £91,954), reflecting investment in operational capacity.

4. Due Diligence Notes:

• Verify the nature and terms of the director’s advances to confirm there are no conflicts or risks to company cash flow.
• Review tax payment schedules and any potential deferred tax liabilities to assess timing and impact of tax obligations.
• Assess related-party transactions and governance policies due to concentrated ownership to ensure transparency and risk mitigation.
• Confirm stability of revenue streams given the company operates in joinery installation, a sector sensitive to economic cycles.