H3 TECHNICAL ENGINEERING SERVICES LTD

Executive Summary

H3 Technical Engineering Services Ltd exhibits a robust financial position with strong net assets growth and healthy liquidity, supporting the ability to meet financial obligations. The company’s working capital management and equity base provide resilience against short-term risks. Continued monitoring of debtor levels and liquidity ratios is advised to maintain credit quality.

H3 TECHNICAL ENGINEERING SERVICES LTD - Analysis Report

Company Number: 13187528

Analysis Date: 2025-07-29 16:44 UTC

1. Credit Opinion: APPROVE
   H3 Technical Engineering Services Ltd demonstrates a solid financial position with consistent growth in net assets and working capital over recent years. The company maintains a strong liquidity position with net current assets more than six times current liabilities in the latest year, indicating a good ability to meet short-term obligations. There is no evidence of financial distress or adverse director conduct. The business profile in engineering and electrical installation is stable, with a single director who appears to manage the company prudently. Overall, the company is capable of servicing debt and sustaining operations.

2. Financial Strength:
   The balance sheet reflects a healthy financial structure. Net assets have grown from £10.5k in 2021 to £63.5k in 2025, supported by retained earnings. Fixed assets are modest (£9.4k) but stable, primarily motor vehicles. The equity base is strong relative to liabilities, with no long-term debt reported. Current liabilities have decreased slightly (£8.4k in 2025 vs £10.7k in 2024), improving solvency. The company has minimal share capital (£2), indicating most funding is internally generated or retained earnings.

3. Cash Flow Assessment:
   Cash balances remain adequate (£18k at year-end 2025), although slightly down from the previous year (£21.5k). Debtors have increased significantly (£44.5k vs £15.3k), which could indicate extended credit terms or growing sales on credit; this should be monitored for collection risk. The substantial net current assets position (£54k) suggests strong short-term liquidity and working capital management. Overall, liquidity and working capital appear sufficient to support ongoing operations and short-term obligations.

4. Monitoring Points:

• Debtor collection periods and aging profile to ensure cash inflows remain timely.
• Maintenance of current liquidity ratios given the increase in receivables.
• Continued profitability and retention of earnings to support equity growth.
• Any significant investment or financing activities that could alter the current conservative capital structure.
• Director’s ongoing management performance given the single director structure.