FLOPPY DISK MEDIA LTD

Executive Summary

Floppy Disk Media Ltd is currently facing high financial risk due to sustained negative net assets and significant liquidity shortfalls. While the company remains compliant with statutory filings and operates in a potentially stable sector, the financial statements indicate ongoing solvency challenges that warrant careful monitoring. Further detailed due diligence on liabilities and operational plans is recommended to assess the company's prospects for recovery.

FLOPPY DISK MEDIA LTD - Analysis Report

Company Number: 12944516

Analysis Date: 2025-07-20 16:26 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns as evidenced by persistent net current liabilities and negative shareholders' funds exceeding £20,000. This level of net liabilities relative to very limited share capital indicates a financially distressed position.

2. Key Concerns:

• Persistent Negative Net Assets: The company has reported negative net assets for four consecutive years, with a worsening position from £7,553 positive in 2020 to -£20,696 in 2024.
• Liquidity Constraints: Current liabilities consistently exceed current assets by a wide margin (e.g., £23,846 liabilities vs. £3,150 assets in 2024), indicating likely cash flow difficulties and potential inability to meet short-term obligations.
• Reliance on Director Confidence: The director’s statement about going concern contradicts the financial realities and should be treated cautiously. No audit performed reduces transparency on this assertion.

3. Positive Indicators:

• Compliance with Filing Requirements: All accounts and confirmation statements are filed on time and no overdue filings are noted.
• Small Company Reporting: The company is classified as small, with simplified accounting which reduces administrative burden.
• Industry Activity: The company operates in computer and peripheral equipment repair (SIC 95110), a niche with ongoing demand, which could support future recovery if operational issues are addressed.

4. Due Diligence Notes:

• Investigate the nature and maturity of current liabilities to assess any imminent repayment pressures or restructuring plans.
• Review cash flow forecasts and operational strategies to verify the director's going concern assertion and business viability.
• Examine any contingent liabilities or off-balance-sheet obligations that may exacerbate financial risk.
• Consider the background and financial commitment of the new director appointed in 2023, including any capital injections or strategic changes since the leadership transition.
• Confirm whether any related party transactions or director loans exist that influence the financial position.