HAYLE HOMES LIMITED

Executive Summary

Hayle Homes Limited exhibits a high financial risk profile primarily due to negative net current assets and dependency on significant intercompany borrowing from its parent company. While regulatory filings are current and the company operates under a small company regime, liquidity constraints and solvency concerns present material risks. Further investigation into the sustainability of parent company funding and operational cash flows is recommended before considering investment.

HAYLE HOMES LIMITED - Analysis Report

Company Number: 13189362

Analysis Date: 2025-07-29 19:47 UTC

1. Risk Rating: HIGH
   Justification: The company has persistent negative net current assets and shareholders’ funds, indicating ongoing working capital deficits and potential solvency concerns. The current liabilities consistently exceed current assets, primarily due to significant amounts owed to the parent company, which raises dependency and liquidity risk.

2. Key Concerns:

• Negative Net Current Assets: The company’s net current liabilities have increased to £10,633 as of 29 February 2024 from £7,815 the prior year, reflecting worsening short-term financial health.
• Reliance on Parent Company Funding: £759,972 of current liabilities are amounts owed to the parent company AGS Carpentry Ltd, suggesting the company’s cash flow is supported by intercompany loans rather than independent operational cash generation.
• Minimal Cash Balances: Cash on hand is negligible (£71 as of 2024 year-end), which limits the company’s ability to meet immediate obligations without further financing.

3. Positive Indicators:

• Compliance with Filing Requirements: The company is up to date with its accounts and confirmation statement filings, indicating no immediate governance or regulatory compliance issues.
• No Auditor Requirement & Small Company Regime: The company qualifies as a small entity, simplifying compliance and reducing operational overhead.
• Stable Operation Since Incorporation: Incorporated in 2021 and still active, with two directors maintaining consistent leadership.

4. Due Diligence Notes:

• Investigate the terms and sustainability of the loans from the parent company, including repayment schedules, interest, and any potential risk of withdrawal.
• Review the company’s business model and cash flow forecasts to assess if operational improvements or additional capital injections are planned to address the working capital deficit.
• Assess the valuation and liquidity of stock (£750k reported) to confirm if it can be readily converted to cash or if there is risk of impairment beyond that accounted for.
• Confirm whether there are any contingent liabilities or off-balance-sheet obligations not disclosed in the accounts.