Company Number: 13174076

Analysis Date: 2025-07-20 12:12 UTC

1. Credit Opinion: DECLINE
   FIRST AUTO CENTRE LTD shows persistent and worsening negative net assets and shareholders' funds over the past three years, indicating ongoing losses and balance sheet weakness. The company’s current liabilities consistently exceed current assets by a wide margin, reflecting severe liquidity constraints and negative working capital. Without clear evidence of turnaround or capital injection, the company’s ability to meet debt obligations and honor commercial agreements is highly questionable. The director is the sole significant controller, but no indication of financial support or restructuring is provided. Given these factors, extending credit poses a high risk.

2. Financial Strength:
   The balance sheet reveals a deteriorating financial position. Net assets declined from -£32.7k in 2021 to -£42.7k in 2024. Fixed assets have decreased, while current liabilities remain high and increasing relative to current assets. Total liabilities exceed total assets by a large margin, including both short-term and long-term creditors. Shareholders’ equity is negative and worsening, reflecting accumulated losses and insufficient capital base. This weak equity position undermines solvency and limits the company’s buffer against operational shocks.

3. Cash Flow Assessment:
   With current liabilities of £63,860 significantly higher than current assets of £12,354 as of 28 February 2024, the company faces a net current liability position of -£51,506, indicating poor liquidity and working capital management. This suggests difficulty in meeting short-term obligations without external funding. There is no information on cash balances or cash flow from operations, but the consistent negative net current assets infer ongoing cash flow pressure. The company’s micro entity status and small scale suggest limited access to alternative funding sources.

4. Monitoring Points:

• Net current assets ratio and trend to detect liquidity improvements or further deterioration
• Movements in fixed assets and any disposals or impairments affecting capital structure
• Any capital injections or director loans that improve equity and working capital
• Timely filing of future accounts and confirmation statements to ensure transparency
• Operational performance and profitability trends once profit and loss data become available