Company Number: 13207211

Analysis Date: 2025-07-29 12:17 UTC

1. Credit Opinion: DECLINE
   Frenchman Wines Ltd shows significant financial distress as evidenced by its balance sheet. The company has large creditor obligations falling due after more than one year (£97,502) exceeding its current and fixed assets combined, resulting in negative total net assets of -£109,456 in 2024, worsened from -£81,541 in 2023. This indicates the company is insolvent on a balance sheet basis, which poses a high risk for credit extension. The micro-entity classification and small employee base further suggest limited operational scale and financial flexibility. Without substantial improvement in financial health or a credible plan to reduce liabilities, further lending or credit exposure is not advisable.

2. Financial Strength:
   The company’s fixed assets have decreased from £15,874 in 2021 to £6,346 in 2024, and current assets have also declined from £38,779 to £16,060 over the same period. Importantly, current liabilities of £34,360 in 2024 are high relative to current assets, producing a negative net current assets figure (-£18,300). More critically, long-term liabilities have increased to £97,502, overwhelming total assets and resulting in negative net assets. This signals poor solvency and weak financial strength.

3. Cash Flow Assessment:
   With current liabilities exceeding current assets, the company likely faces liquidity pressure. The negative net current assets indicate insufficient working capital to meet short-term obligations. The accounts do not provide explicit cash flow statements, but the trends suggest limited cash generation or cash reserves. This is a warning on the company’s ability to service debt or finance day-to-day operations without additional capital injection.

4. Monitoring Points:

• Monitor changes in creditor balances, especially long-term liabilities
• Track improvements or deterioration in net current assets and net assets
• Watch for any changes in ownership or director involvement that may affect financial strategy
• Review updated financials for signs of cash flow stabilization or capital restructuring
• Assess any external support or capital injection plans by the controlling shareholder