GLOBE ELECTRICAL LIMITED

Executive Summary

Globe Electrical Limited is a micro-entity with positive but declining net assets and liquidity, reflecting increased current liabilities and reduced working capital. The company demonstrates ongoing operational activity but with tightening cash flow conditions, warranting conditional credit approval with close monitoring of liquidity and financial management. Continued oversight is recommended to ensure the company maintains the ability to meet short-term obligations and service credit facilities effectively.

GLOBE ELECTRICAL LIMITED - Analysis Report

Company Number: NI678135

Analysis Date: 2025-07-29 14:54 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Globe Electrical Limited is a micro-entity with limited financial complexity and a short operating history since incorporation in 2021. The company shows a decline in net assets and current assets from 2023 to 2024, with an increase in current liabilities and accruals, indicating some pressure on working capital. While still solvent with positive net assets (£5,292), the reduction in liquidity and net current assets from £13,603 to £3,094 warrants caution. The company’s ability to meet short-term obligations appears adequate but has weakened. Approval is conditional upon monitoring working capital management and timely repayment of any credit extended.

2. Financial Strength:
   The balance sheet shows a small fixed asset base (£4,118) and modest current assets (£7,888) against current liabilities of £4,794 as of 28 February 2024. Net current assets remain positive but have dropped significantly from the previous year. Shareholders’ funds have also declined from £18,448 to £5,292, largely due to increased accruals/deferred income (£1,920) and current liabilities. This reduction may reflect operational challenges or timing differences in income recognition. The company’s modest equity base and micro status limit financial flexibility.

3. Cash Flow Assessment:
   The company’s liquidity has deteriorated, with current liabilities increasing over 30 times from £150 in 2023 to £4,794 in 2024, while current assets decreased by approximately 43%. The net current assets position remains positive but has shrunk markedly, indicating tighter working capital. No audit was performed, so cash flow details are limited, but the financials suggest the company must carefully manage receivables, payables, and cash resources to avoid liquidity stress. The small size and low capital base mean cash flow volatility could impact debt servicing ability.

4. Monitoring Points:

• Track quarterly updates on current assets and liabilities to ensure working capital remains positive and stable.
• Monitor any changes in accruals or deferred income that may impact short-term cash outflows.
• Review director’s financial management practices to confirm responsiveness to liquidity pressures.
• Watch for timely submission of accounts and confirmation statements to avoid regulatory or reputational issues.
• Assess the company’s order book and revenue trends in electrical installation to anticipate future cash flow patterns.