GRP X LTD

Executive Summary

GRP X LTD is a micro-sized construction installation company showing a deteriorating financial position over the last year, with sharply reduced assets and working capital. While still solvent with positive net assets, the company’s limited liquidity and declining financial strength warrant conditional credit approval with stringent monitoring of cash flow and operational performance. Continued oversight is essential to ensure the company can meet short-term obligations and sustain its business operations.

GRP X LTD - Analysis Report

Company Number: 13441433

Analysis Date: 2025-07-20 16:25 UTC

1. Credit Opinion: CONDITIONAL APPROVAL. GRP X LTD is a small micro-entity operating in the niche sector of other construction installation. The company shows positive net assets and working capital but has demonstrated a significant decline in financial strength over the last 12 months. The drop in net current assets from £9,960 to £2,511 and a halving of total net assets from £26,200 to £11,356 indicates a weakening balance sheet. Given its small size, limited employee base (1 employee), and modest asset base, the company’s ability to withstand financial stress or unexpected cash flow demands is limited. Approval should be conditional on close monitoring of cash flow and confirmation of business continuity plans.

2. Financial Strength: The company’s balance sheet at 30 June 2024 shows net assets of £11,356, down from £26,200 the prior year. Fixed assets have decreased from £16,240 to £8,845, and current assets have fallen sharply from £64,681 to £24,148. Current liabilities have also decreased but to a lesser extent (£21,637 vs. £54,721). This shrinkage in asset base and working capital suggests the company may have liquidated some assets or reduced receivables/inventory to cover liabilities. Shareholders funds are modest, reflecting minimal capital investment (£2 issued share capital). The company’s financial trajectory is downward, which raises concerns about its long-term solvency and capital adequacy.

3. Cash Flow Assessment: Net current assets of £2,511 indicate a narrow working capital buffer. This limited liquidity means the company has little margin to absorb delays in cash inflows or increased short-term obligations. The substantial decline in current assets and reduced net current assets signal that cash flow management is tight. With only one employee and a micro entity scale, the company likely has low fixed overheads, but reliance on timely collections and efficient payables management will be critical. No audit or detailed cash flow statements are provided, so assumptions on cash conversion cycles must be cautious.

4. Monitoring Points:

• Monthly cash flow and working capital levels to detect tightening liquidity.
• Receivables aging and creditor payment terms to ensure no build-up of overdue balances.
• Any changes in fixed asset holdings or capital expenditure plans that might affect liquidity.
• Confirmation of contract pipeline or recurring revenue sources to support cash flow sustainability.
• Directors’ commentary on future outlook and contingency plans, especially given the downward trend in net assets.