Company Number: 14378523

Analysis Date: 2025-07-29 17:24 UTC

1. Credit Opinion: DECLINE
   HATTRICK STUDIOS LTD exhibits persistent negative net assets and net current liabilities over the past two years, with worsening financial position (net liabilities increased from -£524 in 2023 to -£866 in 2024). The company has minimal current assets (£40 in 2024) against significantly higher current liabilities (£756), indicating poor short-term liquidity and inability to meet obligations as they fall due. Moreover, the company has no employees apart from the director and operates in a niche industry (sound recording and music publishing) which may have limited cash generation at this stage. The absence of positive cash flows and recurring losses raise concerns about its capacity to service debt or sustain credit facilities. Without clear evidence of incoming funding or business turnaround, extending credit is high risk.

2. Financial Strength:
   Balance sheet health is weak. The company reports net liabilities of £866 at the latest year end, deteriorating from £524 the previous year. Negative net current assets of £716 indicate working capital deficiencies. The company holds negligible current assets (primarily cash or equivalents) and accrues liabilities exceeding these by a large margin. There are no fixed assets reported, suggesting limited collateral value. Equity is fully eroded with accumulated losses reflected in shareholders’ deficit. This weak financial footing undermines resilience to adverse economic conditions.

3. Cash Flow Assessment:
   Working capital is negative and worsening, driven by rising current liabilities and declining current assets. This implies cash flow pressures and potential liquidity problems. The absence of employees and micro-entity status suggest limited operational scale. There is no indication of positive operating cash flows or external capital injections to improve liquidity. The company’s ability to generate sufficient cash from operations or secure alternative funding appears constrained.

4. Monitoring Points:

• Monitor quarterly cash flow statements and bank balances closely to detect liquidity deterioration.
• Track any capital injections or shareholder funding to offset net liabilities.
• Review any changes in current liabilities, especially short-term creditors that may signal payment delays.
• Assess revenue growth or new contracts in sound recording and music publishing sector that could improve cash generation and profitability.
• Watch for director or shareholder actions regarding restructuring or business model changes.