H&D TRADE LTD

Executive Summary

H&D TRADE LTD exhibits high financial risk primarily due to negative net assets and a lack of current assets to cover liabilities, indicating potential solvency and liquidity issues. While compliance with filing obligations is maintained and governance appears stable, the limited financial history and severe working capital constraints warrant thorough due diligence before considering investment.

H&D TRADE LTD - Analysis Report

Company Number: 14379511

Analysis Date: 2025-07-29 16:08 UTC

1. Risk Rating: HIGH

Justification: The company’s latest filed micro-entity accounts show significant negative net assets and liabilities exceeding assets. Current assets are reported as zero in the latest year, while current liabilities remain substantial, indicating an inability to meet short-term obligations. This financial position raises serious concerns about solvency and liquidity.

2. Key Concerns:

• Negative Net Assets: The balance sheet shows total net liabilities of £46,970 as of 30 September 2024, worsening from the prior year, indicating erosion of shareholder funds.
• Zero Current Assets vs. High Current Liabilities: The absence of current assets in 2024 against current liabilities of £19,085 suggests a severe liquidity crunch and potential cash flow distress.
• Small Scale and Limited Financial Data: As a micro-entity incorporated recently in 2022, with only one employee on average, the financial history is minimal, limiting trend analysis and increasing uncertainty regarding operational stability.

3. Positive Indicators:

• No Overdue Filings: Accounts and confirmation statements are up to date, demonstrating compliance with statutory filing deadlines.
• Active Status: The company is currently active and not in liquidation or administration.
• Clear Ownership Structure: Two named persons with significant control each owning 25-50% with rights to appoint/remove directors, indicating stable governance.

4. Due Diligence Notes:

• Investigate the nature and terms of liabilities, especially the large creditors falling due after more than one year (£27,885 in 2024).
• Clarify the reason for zero current assets in the latest year and assess cash flow management and working capital cycle.
• Obtain further operational data to understand revenue generation, profitability, and business model sustainability given the micro-entity status.
• Review director conduct and background for any adverse records—no disqualifications are apparent but a deeper check is advisable.
• Confirm the accuracy and completeness of financial reporting given the negative equity position and micro-entity exemptions.