HAAR AT HOME LIMITED

Executive Summary

Haar At Home Limited demonstrates adequate liquidity and solvency for credit provision but has experienced a marked decline in net assets and cash balances over the past year. While the company maintains positive working capital, ongoing monitoring of cash flow and equity trends is essential to mitigate tightening financial conditions. Conditional credit approval is recommended with regular financial reviews.

HAAR AT HOME LIMITED - Analysis Report

Company Number: SC666182

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

1. Credit Opinion: CONDITIONAL APPROVAL
   Haar At Home Limited shows adequate short-term liquidity and positive net assets for credit consideration. However, a noticeable decline in net assets and net current assets from 2023 to 2024 signals some financial weakening. The company operates in the "Other food services" sector, a competitive and often low-margin industry, which requires close monitoring of cash flow and working capital. Credit can be approved with conditions including regular financial updates and limits consistent with current asset coverage.

2. Financial Strength:
   The company’s balance sheet reveals net assets of £44,887 as of July 2024, down from £88,237 the previous year, indicating a halving of equity value. Tangible fixed assets are modest (£5,338) and declining due to depreciation. Current assets (£103,490) comfortably exceed current liabilities (£62,927), providing a positive working capital buffer (£40,563), albeit reduced from last year’s £69,707. The reduction in cash from £30,199 to £16,569 is a concern but is partially offset by stable debtor balances (£80,921). Overall, the company remains solvent but with shrinking equity and liquidity cushions.

3. Cash Flow Assessment:
   Cash balances have significantly decreased over the latest year, potentially reflecting operational cash outflows or capital expenditure. Debtors remain sizeable and stable, but trade creditors have increased, tightening short-term obligations. Net current assets remain positive, supporting short-term obligations, but the decline suggests tighter liquidity. The working capital position supports ongoing operations, yet the company may face pressure if sales or collections slow. No overdrafts or borrowings are reported, indicating no immediate debt servicing concerns.

4. Monitoring Points:

• Continued monitoring of net asset trend and equity erosion.
• Cash flow management, focusing on improving cash conversion from debtors and controlling creditor terms.
• Profitability and operational margins, given the lack of detailed profit and loss data.
• Directors’ management of working capital and any new financing needs.
• Sector risks related to food service, including demand volatility and cost pressures.