HANDSACRE LOCAL LIMITED

Executive Summary

Handsacre Local Limited shows signs of financial improvement with positive net current assets and increasing net asset value, reflecting growing operational stability. However, liquidity fluctuations in prior years and a small equity base present moderate solvency risks. The concentrated control structure and micro-entity scale suggest the need for careful governance review and ongoing monitoring of cash flow and liabilities.

HANDSACRE LOCAL LIMITED - Analysis Report

Company Number: 13152167

Analysis Date: 2025-07-29 13:34 UTC

1. Risk Rating: MEDIUM
   The company demonstrates improving net current assets and net assets over recent years, indicating progress toward financial stability. However, the micro-entity scale and relatively thin equity base limit resilience against operational or market shocks. The uneven current liabilities and modest share capital warrant caution.

2. Key Concerns:

• Liquidity Fluctuations: Current liabilities have decreased significantly year-on-year but were previously higher than current assets, indicating past liquidity stress. Close monitoring of cash flow management is essential.
• Small Equity and Capital Base: With only £100 share capital and net assets around £203k, the company has limited buffer to absorb losses or fund expansion without external capital.
• Concentration of Control and Management: Significant control and director roles are concentrated within a small family group, which might limit governance diversity and could pose succession or operational risks.

3. Positive Indicators:

• Improved Working Capital Position: The net current assets improved from negative in prior years to a positive £55k as of January 2024, signaling better short-term financial health.
• Timely Compliance: The company is up to date with its filings and accounts, indicating sound regulatory compliance practices.
• Stable Fixed Asset Base: The fixed assets have remained relatively stable, suggesting capital preservation and potential operational stability.

4. Due Diligence Notes:

• Review detailed cash flow statements and debtor/creditor aging to understand liquidity dynamics beyond balance sheet snapshots.
• Investigate the nature and terms of current liabilities to assess repayment schedules and potential refinancing needs.
• Examine governance practices given the concentrated ownership and management to evaluate risk of related-party transactions or conflicts of interest.
• Confirm the sustainability of the business model in the retail sector, including market positioning and competitive pressures.