GREYGAN BUILDING SERVICE LTD

Executive Summary

GREYGAN BUILDING SERVICE LTD demonstrates a significant decline in financial strength and capital base over recent years, raising concerns about its ability to meet debt obligations. Current liquidity appears marginally adequate, but the overall erosion of assets and equity indicates heightened credit risk. Credit facilities are not recommended without substantial improvement or additional security.

GREYGAN BUILDING SERVICE LTD - Analysis Report

Company Number: 13102705

Analysis Date: 2025-07-19 13:05 UTC

1. Credit Opinion: DECLINE
   GREYGAN BUILDING SERVICE LTD exhibits significant financial deterioration over recent years, with a marked reduction in total assets and shareholders’ funds between 2020 and 2024. The company's net equity has fallen from £16,017 in 2020 to £2,457 in 2024, indicating erosion of capital and potential financial distress. Their current assets and fixed assets have shrunk dramatically, suggesting poor asset management or operational challenges. While current liabilities are low in the latest year, the sharp decline in working capital and equity signals weak financial resilience and limited capacity to service new or existing debt. The micro-entity status and minimal share capital further constrain their financial robustness. Given these factors, extending credit facilities carries elevated risk.

2. Financial Strength:
   The balance sheet shows a drastic contraction in fixed assets from £9,645 in 2020 to £210 in 2024, and a collapse in current assets from £6,592 to £1,293 over the same period. Current liabilities have decreased from £1,538 to £278, improving the net current asset position, but this occurs amid an overall shrinking asset base. Shareholders’ funds have diminished by over 80%, indicating accumulated losses or withdrawals. The company’s financial structure is fragile, with minimal equity cushion against potential losses or external shocks. The decline in capital and reserves reflects poor capital preservation and raises concerns about ongoing solvency.

3. Cash Flow Assessment:
   Current assets exceed current liabilities by a small margin (£1,293 vs £278), suggesting satisfactory short-term liquidity on paper. However, the reduction in current assets is significant compared to prior periods, and the micro-entity scale implies limited cash resources. The negligible fixed assets may limit collateral for borrowing. The average employee count of one indicates a very small operation, potentially limiting cash inflows. Lack of detailed cash flow data restricts full analysis, but the downward trend in assets and equity points to constrained cash generation capacity and possible reliance on external funding or owner injections.

4. Monitoring Points:

• Track quarterly cash flow statements to verify liquidity trends and operating cash generation.
• Monitor equity movements for further erosion or recapitalization efforts.
• Watch for any late filings or regulatory compliance issues that may signal management difficulties.
• Assess any changes in director appointments or PSC information for governance stability.
• Review forthcoming accounts for signs of turnaround or continuing decline, particularly asset sales or accrual buildup.