FADE MATICS LIMITED

Executive Summary

FADE MATICS LIMITED operates as a micro-entity with small scale and weakening financial health, characterized by persistent negative working capital and declining net assets. The company’s limited liquidity and absence of demonstrated profitability pose high credit risk, leading to a recommendation to decline credit facilities at this time. Close monitoring of liquidity and equity trends is advised if the business profile changes.

FADE MATICS LIMITED - Analysis Report

Company Number: 12808985

Analysis Date: 2025-07-20 15:08 UTC

1. Credit Opinion: DECLINE
   FADE MATICS LIMITED demonstrates weak liquidity and deteriorating working capital over the last three years, with persistent net current liabilities. The company’s net assets have declined steadily from £18,034 in 2020 to £9,877 in 2024, indicating erosion of financial strength. With only two employees and micro-entity filing status, the scale of operations is small, and the director’s occupation as a barber suggests limited formal financial management expertise. The absence of profitability or cash flow data raises concerns about the ability to service any credit facility. Thus, the risk of repayment default is elevated.

2. Financial Strength:
   The balance sheet shows a modest asset base, primarily fixed assets under £16k and current assets under £9k against current liabilities of over £14k. The negative net current assets (working capital) position signals reliance on short-term financing or delayed payments to meet obligations. Shareholders’ funds have nearly halved over four years, reflecting possible losses or withdrawals. No external equity or debt financing is evident. This weak financial structure undermines the company’s resilience to economic shocks or unforeseen expenses.

3. Cash Flow Assessment:
   Current asset composition and liabilities suggest liquidity constraints. Negative working capital implies the company may struggle to fund day-to-day operations without external support. The reduction in current assets and fixed assets between 2023 and 2024 indicates limited reinvestment or shrinking operational scale. Without detailed cash flow statements, it is prudent to assume tight cash flows and minimal buffer for debt servicing. The micro entity status and small workforce suggest limited operational complexity but also limited cash-generating capacity.

4. Monitoring Points:

• Liquidity ratios, specifically current ratio and quick ratio, to monitor ongoing working capital health.
• Trends in net assets and equity to detect further erosion.
• Timeliness of statutory filings and any changes in director or ownership structure.
• Any emergence of external financing or credit facilities that may affect repayment capacity.
• Business performance indicators such as client base growth or diversification in service offerings given the narrow hairdressing SIC classification.