FN TRADERS LIMITED

Executive Summary

FN Traders Limited exhibits ongoing financial weakness characterized by negative net assets, working capital deficits, and low liquidity. The company’s reliance on director loans and absence of audited accounts elevate credit risk. Without evidence of improved cash flow or profitability, new credit exposure is not advisable at this time.

FN TRADERS LIMITED - Analysis Report

Company Number: 12777668

Analysis Date: 2025-07-20 19:14 UTC

1. Credit Opinion: DECLINE
   FN Traders Limited demonstrates weak financial health with persistent net current liabilities and negative shareholders' funds over recent years. The company’s net assets deteriorated from £2,004 positive in 2020 to a negative £553 in 2024. Current liabilities exceed current assets by £7,277 as of the latest accounts, indicating insufficient short-term liquidity to meet obligations. The company also relies on director loans (£3,201 in 2024) which may indicate cash flow strain. The absence of a profit and loss statement filing and the unaudited accounts limit transparency, increasing credit risk. Given these factors, the company does not currently present a reliable capacity to service new or existing debt facilities.

2. Financial Strength:
   The balance sheet shows declining net assets and negative working capital throughout the last three years. Tangible fixed assets have decreased slightly due to depreciation but remain modest (£6,724). The negative shareholders’ funds reflect accumulated losses (£653 deficit in retained earnings) eroding equity base. Reliance on director loans (~£3,200) and other creditors (~£3,250) points to external funding dependence. Overall, the balance sheet is fragile with limited buffer against financial stress.

3. Cash Flow Assessment:
   Cash balances are very low (£1,125 at year end 2024), insufficient to cover even one month of current liabilities (£8,402). Net current liabilities of £7,277 confirm working capital deficits, suggesting ongoing liquidity challenges. The increase in average employees from 2 to 4 indicates some business growth, but this has not translated into improved liquidity or profitability. Director loans provide temporary relief but are not sustainable as a long-term funding source. Cash flow appears constrained, risking delayed payments to suppliers and creditors.

4. Monitoring Points:

• Monitor profitability trends and filing of profit and loss accounts for clarity on earnings performance.
• Track changes in working capital and liquidity ratios, especially current ratio and quick ratio.
• Review director loan balances and terms for potential refinancing or repayment risks.
• Observe management actions to improve cash flow and reduce liabilities.
• Watch for timely submission of statutory filings to assess management diligence.