H AND M ENTERPRISE LIMITED

Executive Summary

H AND M ENTERPRISE LIMITED is a micro-entity with modest net assets that have declined slightly in the latest year but remain positive. The company’s liquidity is adequate though weakening, with stable staff numbers and consistent borrowings. Conditional approval is recommended, subject to ongoing monitoring of cash flow, profitability, and debt levels given the sensitive sectors it operates within.

H AND M ENTERPRISE LIMITED - Analysis Report

Company Number: 12747246

Analysis Date: 2025-07-29 19:15 UTC

1. Credit Opinion: CONDITIONAL APPROVAL. H AND M ENTERPRISE LIMITED is a small micro-entity active for four years with modest but stable net assets and shareholders’ funds. The company shows a small decline in net assets from £5,860 in 2023 to £3,878 in 2024, indicating some erosion in capital. The presence of £10,000 long-term liabilities consistently on the balance sheet warrants monitoring. The business operates in travel agency and retail mobile phone sales sectors, which can be sensitive to economic fluctuations. Directors appear stable with no adverse records. Overall, the company shows ability to service debt but requires close monitoring of liquidity and profitability trends before extending significant credit.

2. Financial Strength: The balance sheet shows fixed assets steady at £9,125 and net current assets declining from £6,735 (2023) to £4,753 (2024). Current liabilities remain at £10,000 with corresponding long-term creditors also at £10,000, indicating sustained borrowing or trade payables. Net assets declined by about 34% year-over-year, which suggests some pressure on retained earnings or profitability. Shareholders’ funds remain positive but modest at £3,878, reflecting a micro-entity scale business. The company maintains a small share capital of £100. The financial position is adequate but with limited buffer.

3. Cash Flow Assessment: Current assets declined from £8,310 to £5,903, which, combined with stable current liabilities, reduces working capital cushion. The net current assets remain positive (£4,753), signalling short-term liquidity is sufficient but weakening. The company employs 4 staff consistently, implying stable operating costs. The reduced cash or receivables level could constrain cash flow if sales or collections slow. No explicit cash flow statement is provided, so liquidity must be inferred from balance sheet trends. The company should maintain tight credit control and monitor cash inflows to avoid liquidity risk.

4. Monitoring Points:

• Trend in net assets and retained earnings: watch for further capital erosion.
• Liquidity ratios: Current ratio and quick ratio to ensure adequate working capital.
• Profitability metrics: To confirm ability to generate sufficient cash flow for debt servicing.
• Debt levels: The £10,000 long-term creditors should be reviewed for repayment terms and source.
• Sector risks: Travel and retail telecoms can be volatile; monitor market conditions.
• Director conduct or changes: Stability currently noted but important for credit risk.