Company Number: 12776296

Analysis Date: 2025-07-29 19:03 UTC

1. Credit Opinion: DECLINE. HH (Bromham) Limited shows significant financial distress evidenced by negative shareholders' funds (£-1.55m in 2021) and negative net current assets (£-1.55m in 2021), indicating a working capital deficit. The company has a substantial bank loan of £6.61m secured against property, repayable on demand, and large liabilities exceeding current assets, raising liquidity risk. Despite being active and having no overdue filings, the financial position and reliance on a demand loan suggest inability to comfortably service debt or absorb shocks without external support.

2. Financial Strength: The company's balance sheet reflects weak financial strength. Shareholders’ funds are negative and deteriorated from £-107k in 2019 to £-1.55m in 2021, showing accumulated losses. Current liabilities nearly double current assets primarily due to a large bank loan and amounts owed to group companies. Fixed assets are not explicitly stated in the latest accounts, but the loan is secured on freehold property, indicating some asset backing. However, the overall net asset position is negative, and equity is eroded, highlighting poor capitalisation.

3. Cash Flow Assessment: Cash at bank is nominal (£28 as of 2021 year-end), indicating very limited liquidity. The company’s net current liabilities position suggests working capital is negative and insufficient to meet short-term obligations. The bank loan is repayable on demand with interest at a variable rate (6.69% + Bank of England base), creating refinancing risk. Absence of meaningful cash reserves and high current liabilities point to significant cash flow constraints and potential difficulties in meeting immediate debt servicing and operational needs.

4. Monitoring Points:

• Monitor any changes in loan covenants or refinancing status of the demand loan with Oaknorth Bank Plc.
• Watch for improvements in cash balances and net current assets in subsequent filings.
• Track any intercompany balances with HH Development Group Limited, as this group owes the company substantial amounts.
• Observe directors’ reports and audit opinions for indications of going concern issues or restructuring plans.
• Keep an eye on operational performance in the construction sector given economic sensitivities.