Company Number: SC720851

Analysis Date: 2025-07-20 13:29 UTC

1. Risk Rating: HIGH
   Justification: The company shows negative net current assets (£-1,875) and negative shareholders' funds (£-1,875) in the most recent financial year, indicating insolvency on a balance sheet basis. The small scale and limited financial history reduce confidence in operational stability.

2. Key Concerns:

• Solvency Risk: The company’s net current liabilities and negative equity position at 31 January 2024 suggest it may not be able to meet short-term obligations without additional funding.
• Liquidity Concerns: Current liabilities exceed current assets, pointing to potential cash flow difficulties. No cash or cash equivalents breakdown is available to assess immediate liquidity.
• Operational Stability: The company is very new (incorporated 2022) and has only one employee, which may indicate limited capacity to scale or absorb operational shocks.

3. Positive Indicators:

• Compliance: Filings (accounts and confirmation statement) are up to date and not overdue, showing good regulatory compliance to date.
• Ownership Structure: Clear and stable ownership with a majority shareholder controlling 75-100% of shares, which may support decision-making and capital injections if needed.
• Industry Activity: Engaged in fundamental trades (plumbing, heating, electrical installation) which typically have steady demand.

4. Due Diligence Notes:

• Review recent cash flow statements or management accounts (if available) to better understand liquidity and cash management.
• Investigate the cause of the deterioration from a marginally positive net asset position in 2023 to negative in 2024—was it due to increased liabilities, losses, or asset write-downs?
• Assess any contingent liabilities or off-balance sheet obligations that may exacerbate financial stress.
• Confirm if the company has access to external funding or shareholder support given the negative equity.
• Examine customer contracts and pipeline to evaluate future revenue visibility and operational sustainability.