GALAXY GREEN GRANTS LTD

Executive Summary

Galaxy Green Grants Ltd has demonstrated financial improvement by moving from negative to positive net assets within two years of incorporation. However, the company’s reliance on director loans and significant reduction in cash reserves present liquidity and solvency risks that require closer scrutiny. Operational scale appears limited, but current compliance with filing obligations is satisfactory.

GALAXY GREEN GRANTS LTD - Analysis Report

Company Number: 14282921

Analysis Date: 2025-07-29 21:00 UTC

1. Risk Rating: MEDIUM
   Justification: Galaxy Green Grants Ltd shows a recent improvement in net assets from a negative position (£-8,159 in 2023) to a positive but modest equity balance (£1,610 in 2024). While liquidity is currently positive with net current assets of £8,229, the company carries significant long-term liabilities (director’s loan account of £8,099). The company is young (incorporated 2022) and operates in a niche building completion and plumbing sector, which may be sensitive to economic cycles. No overdue filings or liquidation status reduce immediate compliance concerns.

2. Key Concerns:

• High director’s loan balance: £8,099 due after more than one year indicates reliance on director financing, which may present refinancing or repayment risk.
• Low cash reserves: Cash decreased from £29,568 in 2023 to £5,089 in 2024, potentially impacting liquidity despite positive net current assets.
• Operating scale and sustainability: The company employs only 2 people and has relatively low asset values, suggesting limited operational scale and possible vulnerability to market fluctuations.

3. Positive Indicators:

• Improved net asset position: The company moved from a negative equity position in 2023 to positive shareholders’ funds in 2024, reflecting some financial stabilization.
• No overdue statutory filings: Accounts and confirmation statement are current, evidencing good compliance and governance practices.
• Tangible fixed assets maintained: The company holds tangible fixed assets (£1,480), supporting operational capacity in its building and plumbing sector.

4. Due Diligence Notes:

• Investigate the nature, terms, and repayment schedule of the director’s loan account to assess funding sustainability and risk of future cash outflows.
• Review cash flow statements (if available) to understand the causes of the sharp cash decline and assess ongoing liquidity management.
• Examine revenue streams and contract pipeline given the company’s niche SIC codes and small workforce to evaluate operational stability and growth prospects.
• Confirm no related party transactions or potential conflicts involving the director who is also a major shareholder (25-50% control).