GRAYS UTILITY SOLUTIONS LTD

Executive Summary

Grays Utility Solutions Ltd is a micro-entity showing early signs of financial recovery with a positive net asset position after previous losses. However, liquidity remains constrained due to negative working capital, warranting a cautious credit approach. Conditional approval is recommended with ongoing monitoring of cash flow improvements and financial filings to mitigate risk.

GRAYS UTILITY SOLUTIONS LTD - Analysis Report

Company Number: 12929390

Analysis Date: 2025-07-29 17:39 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Grays Utility Solutions Ltd shows early signs of financial recovery with positive net assets of £205 as of 31 October 2023, improving from prior years' negative equity. However, the company continues to carry a working capital deficit, indicating liquidity constraints. Given the micro-entity scale and limited trading history since incorporation in 2020, credit approval is conditional upon continued improvement in liquidity and profitability, supported by timely financial updates and possibly personal guarantees from directors.

2. Financial Strength:
   The company’s balance sheet exhibits low fixed assets (£2,246) and modest current assets (£2,434) against current liabilities of £4,475, resulting in net current liabilities of £2,041. The turnaround from net liabilities of -£1,523 in 2022 to positive net assets of £205 in 2023 reflects some strengthening of capital structure, though absolute equity remains minimal. Shareholders’ funds moved from negative to slightly positive, indicating a reduction in accumulated losses but still very thin capital buffers.

3. Cash Flow Assessment:
   The persistent net current liability position suggests working capital pressure, which may constrain the company’s ability to meet short-term obligations without external support. The small scale of operations (turnover of £54,656 in 2022) and only two employees limit operational cash generation, emphasizing the need for close monitoring of cash inflows and outflows. Absence of off-balance sheet liabilities is positive, but liquidity risk remains a key concern given negative net current assets.

4. Monitoring Points:

• Improvement in net current assets and liquidity ratios.
• Turnover growth and profitability trends in subsequent accounts.
• Timely filing of annual accounts and confirmation statements.
• Directors’ management of working capital and any additional capital injections.
• Any changes in control or director appointments that might affect governance.