FLETCHER ACCESS LTD

Executive Summary

Fletcher Access Ltd shows a stable equity position and compliance with regulatory filings, evidencing operational continuity. Nonetheless, the company’s persistent negative working capital and increased finance lease liabilities point to potential liquidity stress that warrants closer scrutiny. Overall, the company’s medium risk profile suggests investors should conduct thorough due diligence, particularly around cash flow management and related party funding.

FLETCHER ACCESS LTD - Analysis Report

Company Number: 04436808

Analysis Date: 2025-08-07 20:02 UTC

1. Risk Rating:
MEDIUM

Justification:
Fletcher Access Ltd maintains positive net assets and shareholders' funds (£498,648 as of 31 May 2024) and has been compliant with filing requirements, indicating regulatory good standing and operational continuity. However, persistent negative net current assets over multiple years (e.g., -£8,083 in 2024) and relatively high current liabilities compared to current assets raise liquidity concerns, limiting its short-term financial flexibility.

---

2. Key Concerns:

• Negative Working Capital: The company has consistently exhibited negative net current assets for several years, indicating potential liquidity strain in meeting short-term obligations. Although improved from previous years, the current position (net current liabilities of £8,083) remains a concern.
• High Use of Finance Lease Obligations: There is a significant increase in finance lease liabilities within current (£44,167) and non-current (£66,250) liabilities, which may create fixed repayment commitments affecting cash flow management.
• Director Loans/Oweings: Related party transactions reveal material amounts due to directors (£108,598 to Mr. A J Fletcher), suggesting reliance on director funding that may not be sustainable or market competitive.

---

3. Positive Indicators:

• Consistent Net Asset Growth: The company’s net assets and shareholders’ funds have increased substantially over recent years, moving from £55,780 in 2015 to £498,648 in 2024, reflecting retained earnings accumulation and asset growth.
• Cash Balance Improvement: Cash reserves have increased year-over-year (from £157,144 in 2023 to £176,659 in 2024), which helps liquidity and operational cash flow stability.
• Compliance and Timeliness: The company is active, not in liquidation or administration, with no overdue filings for accounts or confirmation statements, evidencing good governance and compliance with corporate regulations.

---

4. Due Diligence Notes:

• Examine Lease Agreements: Review the terms, duration, and impact of finance lease obligations to understand future cash flow commitments and risk of lease defaults.
• Assess Working Capital Management: Analyze how management intends to address persistent negative working capital concerns, including any plans to reduce short-term liabilities or increase liquid assets.
• Related Party Debt: Investigate the director loans/amounts owed for repayment terms, interest rates (if any), and potential impacts on operational independence and creditors’ priority.
• Profitability and Cash Flow Trends: With limited detail on turnover and profitability in the provided data, further investigation into the company’s income trends and cash flow statements would be necessary to assess operational sustainability.
• Asset Valuation and Depreciation: Confirm the fair valuation and condition of tangible fixed assets, especially given the material values recorded (£583,738 net), to ensure assets support business operations and collateral capacity.

---