HENRY'S HOLIDAY LETTINGS LTD

Executive Summary

Henry's Holiday Lettings Ltd shows financial stabilization with positive net assets driven by fixed asset holdings, but suffers from significant short-term liquidity constraints. The company’s ability to meet current liabilities is limited, requiring close cash flow monitoring and potentially credit support secured against property. Conditional credit approval is recommended pending satisfactory cash flow forecasts and risk mitigation measures.

HENRY'S HOLIDAY LETTINGS LTD - Analysis Report

Company Number: 14262089

Analysis Date: 2025-07-29 16:36 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Henry's Holiday Lettings Ltd is an active private limited company operating in real estate letting. The company shows a positive turnaround in net assets from a negative equity position (£-9,370) in 2023 to a modest positive net asset value of £8,858 in 2024. However, the company’s current liabilities remain significantly higher than current assets, resulting in a substantial negative working capital position. The presence of a long-term charge by Monmouthshire Building Society indicates secured borrowing against property assets. Given the micro-entity status and limited operational scale (one employee), the company’s ability to service short-term obligations may be strained, but the fixed asset base provides some security. Credit approval is possible if supported by strong cash flow forecasts and possibly guarantees or collateral due to liquidity constraints.

2. Financial Strength:
   The balance sheet is dominated by fixed assets of approximately £3.7 million, presumably property holdings related to holiday lettings. Despite this asset base, current liabilities exceed current assets by over £3.2 million, indicating poor short-term financial health and potential liquidity risk. The company’s net assets have improved to a small positive figure due to the introduction of a £500,000 long-term creditor, which reduces current liability pressure. Shareholders’ funds are minimal but positive for the first time, reflecting stabilization. The company’s micro classification and exemption from full audit limits detailed financial transparency.

3. Cash Flow Assessment:
   Current assets are minimal (£30k), mainly cash and receivables, while current liabilities are high (£3.25 million), pointing to negative working capital and potential difficulties in meeting short-term obligations without additional financing or asset liquidation. The financial statements do not provide profit and loss details, limiting insight into operational cash generation. The company’s single employee indicates low operational overhead, which may help conserve cash. The secured charge on assets may provide lender comfort, but monitoring cash flow closely is essential.

4. Monitoring Points:

• Liquidity position and changes in working capital—watch for improvement in current assets or reduction in current liabilities.
• Timely servicing of liabilities, particularly creditor payments and interest on secured debt.
• Operational profitability once P&L data becomes available, to assess sustainability of cash flow.
• Any further borrowing or changes in secured debt that may impact asset encumbrance.
• Compliance with filing deadlines and any changes in company status or director appointments.