HARWES PROPERTIES LTD

Executive Summary

Harwes Properties Ltd exhibits weak financial health characterized by negative net assets and a significant working capital shortfall. The company’s heavy reliance on secured debt and minimal current assets raise concerns about its capacity to meet financial obligations. Without clear evidence of income generation or capital support, the risk of default is elevated, leading to a recommendation to decline credit facilities at this stage.

HARWES PROPERTIES LTD - Analysis Report

Company Number: 14123545

Analysis Date: 2025-07-29 12:19 UTC

1. Credit Opinion: DECLINE. Harwes Properties Ltd shows persistent net liabilities and negative shareholders’ funds since incorporation. The current liabilities substantially exceed current assets, resulting in a negative working capital position of approximately £66k. The company’s fixed asset base consists solely of investment property valued at £229k, which has remained static year-over-year, indicating no growth or asset appreciation. The large secured bank loan of £167.5k dominates the liabilities, and there is no evidence of earnings, profitability, or cash flow generation to support debt servicing. The absence of audited financials and minimal operational activity (no employees reported) further increase credit risk. Overall, the company lacks financial strength and liquidity to reliably meet debt obligations.

2. Financial Strength: The balance sheet is weak, with net liabilities of about £4.7k, reflecting accumulated losses or deficits. Fixed assets represent the main asset at £229k, but current assets are minimal (£5.5k), and current liabilities are very high (£167.5k plus £71k short-term creditors). Shareholders’ funds are negative, signaling a capital deficiency. No retained earnings or capital injections have improved the equity base since incorporation. The leverage is high, with secured debt almost entirely financing the asset base. The company is highly reliant on external financing with no visible operational income or profitability.

3. Cash Flow Assessment: Cash balances are low, around £4.5k, insufficient to cover immediate liabilities of £70.9k short term and £167.5k long term. The working capital deficit of approximately £66k indicates cash flow constraints. There is no indication of positive operating cash flow or income streams. The company’s ability to generate cash internally to service debt or meet creditor demands appears very limited. Since the accounts show no employees and no income statement, it suggests minimal business activity, increasing reliance on external funding for liquidity.

4. Monitoring Points:

• Watch for any significant changes in current liabilities or injection of new capital.
• Monitor cash flow statements if available to detect improvement in liquidity.
• Track any changes in investment property valuation or sales that could improve asset base.
• Assess director actions or related party transactions for risk of further financial deterioration.
• Follow any updates on secured loan repayment terms or refinancing.