FAIRFIELD DEVELOPMENT (CALMORE) LIMITED

Executive Summary

Fairfield Development (Calmore) Limited is a young micro-entity showing growth in working capital and operational assets but remains in a net liability position with negative equity. While short-term liquidity appears sufficient, the company’s solvency is vulnerable due to significant long-term debt. Conditional credit approval is recommended, contingent upon improved equity or debt management and close cash flow scrutiny going forward.

FAIRFIELD DEVELOPMENT (CALMORE) LIMITED - Analysis Report

Company Number: 14262099

Analysis Date: 2025-07-29 21:14 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Fairfield Development (Calmore) Limited, a micro-entity operating in building project development, shows a growing asset base and improving net current assets, indicating operational progress. However, the company carries net liabilities and negative shareholders' funds, reflecting accumulated losses and a weak equity position. Credit approval is conditional on close monitoring of cash flow and further equity injections or debt restructuring to improve solvency.

2. Financial Strength:
   The company’s balance sheet reveals current assets of £1.49m and current liabilities of £0.62m as of July 2024, resulting in strong net current assets (£872k), which supports short-term liquidity. However, significant long-term creditors (£956k) push net liabilities to £86k, indicating the company’s liabilities exceed total assets. The negative equity position and growing long-term debt exposure present solvency concerns, typical for a young development firm but requiring remediation to ensure financial stability.

3. Cash Flow Assessment:
   The current asset to current liability ratio (~2.4x) suggests adequate liquidity to cover short-term obligations. The company’s working capital has increased since the prior year, demonstrating improving operational cash management. Nevertheless, the sizable long-term creditor balance implies reliance on external financing, which may pressure future cash flows. Absence of profit and retained losses underline the need for positive operating cash generation or capital support to sustain ongoing development activities.

4. Monitoring Points:

• Watch trends in net liabilities and shareholders’ funds for signs of equity strengthening or further erosion.
• Monitor the maturity profile and servicing capacity of long-term creditors to avoid liquidity strain.
• Track cash flow from operations and capital expenditure plans in the development pipeline.
• Review director actions on financial restructuring or capital injections to restore net asset positivity.
• Ensure timely filings and compliance to avoid regulatory or reputational risks.