HEDEF STRUCTURAL ENGINEERING AND CONSULTING LTD

Executive Summary

HEDEF STRUCTURAL ENGINEERING AND CONSULTING LTD is a small but growing entity with improving financial metrics and positive net assets. While liquidity and capital are currently tight, the company shows signs of strengthening profitability and cash position. Conditional credit approval is advised with close monitoring of working capital and cash flow management to mitigate risk.

HEDEF STRUCTURAL ENGINEERING AND CONSULTING LTD - Analysis Report

Company Number: 13800522

Analysis Date: 2025-07-29 20:33 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   HEDEF STRUCTURAL ENGINEERING AND CONSULTING LTD demonstrates modest but positive net assets and improved working capital over recent years, indicating gradual financial strengthening. However, the company remains small with limited capital and narrow liquidity margins, which poses some risk. Approval is recommended with conditions—monitoring liquidity closely and limiting credit exposure until further growth and cash flow stability are evident.

2. Financial Strength:
   The balance sheet shows net assets rising from £221 in 2023 to £2,899 in 2024, driven by retained earnings improvement (profit and loss reserve moved from negative to +£1,899). Current assets increased significantly, particularly debtors and cash, while current liabilities doubled. The company is micro-sized, reflecting limited scale and capital base. No fixed assets are reported, indicating reliance on working capital for operations. The shareholder’s funds are minimal but positive, signaling the company is solvent but still at an early growth stage.

3. Cash Flow Assessment:
   Cash at bank nearly doubled from £11,828 to £22,527, supporting liquidity needs. Net current assets are positive but slim at £2,899, reflecting tight working capital. Debtor balances have increased substantially, which may suggest longer collection periods or higher sales on credit, potentially impacting short-term cash flow. Creditors have also increased notably, including sizeable "other creditors," indicating obligations that could pressure liquidity if not managed prudently. Overall, cash flow appears improving but remains constrained, necessitating careful monitoring.

4. Monitoring Points:

• Track debtor aging and collection efficiency to prevent cash flow strain.
• Monitor creditor payment terms and ensure liabilities do not outpace cash inflows.
• Watch profitability trends and retained earnings growth to build equity cushion.
• Assess any changes in contract terms or business scale that might affect working capital needs.
• Keep an eye on any new borrowing or credit facilities to avoid over-leverage given current limited capital.