GORE GROUNDWORKS LIMITED

Executive Summary

Gore Groundworks Limited exhibits a fragile financial position with negative equity and significant working capital deficits, raising concerns about its ability to service debt and sustain operations without external support. Although cash balances have improved, ongoing liquidity pressures and accumulated losses necessitate close monitoring. Given these factors, credit facilities should be declined at this time unless substantial improvements or guarantees are provided.

GORE GROUNDWORKS LIMITED - Analysis Report

Company Number: 13149037

Analysis Date: 2025-07-29 20:02 UTC

1. Credit Opinion: DECLINE. Gore Groundworks Limited shows a persistently weak financial position characterized by negative net assets and significant working capital deficits. Despite some improvement in total assets less current liabilities from negative in 2023 (-£4,506) to positive in 2024 (£14,406), the company remains technically insolvent with shareholders' funds still negative (-£536). Current liabilities greatly exceed current assets, indicating liquidity stress and potential difficulties in meeting short-term obligations. The small equity base (£100 share capital) and ongoing losses reflected in retained earnings suggest limited financial resilience. The departure of one director in September 2024 may also impact management continuity.

2. Financial Strength: The company’s balance sheet reveals a net liability position, with net current liabilities of £85,585 in 2024, though this is an improvement over the prior year’s £110,803 deficit. Fixed assets are significant (£99,991), mostly comprising plant and machinery, which may provide some collateral value. However, the high level of current liabilities (£151,955) relative to current assets (£66,370) highlights ongoing short-term funding pressures. Negative retained earnings (-£636) indicate accumulated losses since incorporation. The company’s total net liabilities of £536 show it remains technically insolvent but has improved from a more severe deficit last year.

3. Cash Flow Assessment: Cash at bank increased markedly from £23,647 in 2023 to £57,908 in 2024, which is a positive sign for near-term liquidity. However, the large current liabilities suggest cash flow may be tight, requiring careful management of payables and receivables. Debtors increased modestly to £6,962 but remain low relative to creditors, implying potential collection challenges. The working capital deficit points to reliance on external funding or creditor terms to meet short-term obligations. The company’s small employee base (average 1 employee) may help control costs but also limits operational scale.

4. Monitoring Points:

• Continued monitoring of net current assets and liquidity ratios to ensure the company can meet short-term debts.
• Watch for trends in retained earnings to assess if losses are being reduced or if profitability can be achieved.
• Review director stability and governance, especially following the recent director resignation.
• Monitor trade debtor collection and creditor payment terms to manage cash flow effectively.
• Track fixed asset utilization and any disposals that could impact collateral value.