Company Number: 12771041

Analysis Date: 2025-07-20 19:06 UTC

1. Risk Rating: HIGH
   The company exhibits significant deterioration in financial performance and net asset value over recent years. Turnover has fallen sharply in the latest year, and net assets have decreased from £2,278 in 2023 to £266 in 2024, indicating potential solvency stress. The scale of operations is minimal with very low turnover and current assets, raising concerns about liquidity and operational sustainability.

2. Key Concerns:

• Declining Revenue and Profitability: Turnover plunged from £16,000 in 2023 to £2,252 in 2024, with corresponding reduction in profit. This trend questions business viability.
• Eroding Net Assets and Shareholders’ Funds: Net assets decreased by about 88% year-over-year, signaling possible capital erosion and increased solvency risk.
• Minimal Operational Scale and Cash Reserves: Current assets dropped from £4,522 to £300, with no current liabilities, implying very limited cash or receivables to fund operations or absorb shocks.

3. Positive Indicators:

• No Overdue Filings: The company is up to date with both accounts and confirmation statement submissions, indicating regulatory compliance and governance diligence.
• No Current Liabilities: Absence of short-term creditors suggests limited immediate financial obligations.
• Micro-entity Filing Status: Filing as a micro entity reflects a straightforward accounting regime which reduces administrative burden.

4. Due Diligence Notes:

• Investigate reasons behind sharp revenue decline and whether it is temporary or structural.
• Review cash flow statements and bank balances to assess liquidity beyond balance sheet figures.
• Assess director’s future plans for financial stabilization or business turnaround.
• Verify absence of off-balance sheet liabilities or contingent risks not disclosed.
• Confirm no undisclosed related party transactions or director loans.
• Consider the impact of the minimal share capital (£50) on financial flexibility.