HALO PROPERTY DEVELOPMENT LIMITED

Executive Summary

Halo Property Development Limited is a newly formed property company with a leveraged balance sheet and negative working capital. While asset-backed by investment property, current liquidity constraints and thin equity require conditional credit approval with active monitoring of cash flow generation and debt servicing. Close attention should be paid to property valuations and short-term liability management to mitigate credit risk.

HALO PROPERTY DEVELOPMENT LIMITED - Analysis Report

Company Number: 15075746

Analysis Date: 2025-07-20 14:07 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Halo Property Development Limited is a newly incorporated property development company with a relatively small equity base and negative working capital. The company holds investment property valued at £415,585 but currently exhibits net current liabilities of £232,140, driven by short-term debt and director loans. The presence of secured bank loans backed by personal guarantees indicates some management commitment. However, the negative net current assets and modest net assets (£14,743) signal liquidity constraints. Credit approval should be conditional on close monitoring of cash flow improvements and repayment plans, as well as confirmation that property valuations remain stable or improve.

2. Financial Strength:
   The balance sheet shows fixed assets mainly in investment property (£415,585) and minimal tangible assets. Total liabilities include substantial bank loans (£278,609 total, with £143,459 short term and £135,150 long term) plus director loans (£104,408 short term). Shareholders’ funds are thin at £14,743, reflecting early-stage capitalisation and accumulated losses (£18,991 P&L deficit). Deferred tax provision arises from revaluation gains. Overall, the financial structure is asset-backed but leveraged, with low equity buffer and a negative working capital position, which could impair financial flexibility.

3. Cash Flow Assessment:
   The company has limited cash resources (£12,726) and debtors (£14,021) insufficient to cover current liabilities of £258,887, resulting in a working capital deficit. The negative net current assets indicate potential short-term liquidity risk. The loans from directors suggest internal funding support at this stage. Cash flow from operations is unproven due to the lack of reported income or profit and absence of employees. The company’s ability to service debt depends on realisation of property assets or successful development projects generating cash inflows.

4. Monitoring Points:

• Progress on property development or sales generating positive cash flow.
• Movement in investment property valuation and realization of gains.
• Reduction of short-term liabilities and director loans.
• Timely servicing of bank loan interest and principal repayment.
• Updates on working capital improvements and cash reserves.
• Confirmation of no director disqualifications or governance issues.