HJ DISTRIBUTION LTD

Executive Summary

HJ DISTRIBUTION LTD shows stable financial health with strong liquidity and a solid net asset position relative to its size. The company’s compliance record is good, and there is no indication of financial distress. While modest in scale, it appears capable of meeting its short-term obligations, supporting a credit approval with standard monitoring.

HJ DISTRIBUTION LTD - Analysis Report

Company Number: 12778955

Analysis Date: 2025-07-29 19:10 UTC

1. Credit Opinion: APPROVE
   HJ DISTRIBUTION LTD demonstrates a stable financial position with a strong net asset base relative to its liabilities. The company has filed accounts on time with no overdue submissions, indicating good compliance and governance. The micro-sized company shows consistent net assets and working capital, suggesting sufficient capacity to meet short-term obligations. Absence of debt or significant liabilities further supports credit approval. However, as a micro entity with minimal staff and limited asset base, credit exposure should remain moderate and monitored closely.

2. Financial Strength:
   The company’s balance sheet reflects net assets of £28,005 as of 31 July 2024, down slightly from £28,386 the previous year, indicating stable but slightly declining equity. Fixed assets are minimal (£451), reflecting limited investment in long-term assets, which is typical for a distribution business at micro scale. Current assets (£29,087) substantially exceed current liabilities (£843), resulting in strong net current assets (£28,244), evidencing good liquidity and working capital management. No long-term liabilities or borrowings are reported, suggesting low financial risk.

3. Cash Flow Assessment:
   The significant positive net current assets highlight sound liquidity and the ability to cover short-term debts comfortably. The company holds nearly £29k in current assets against under £1k in current liabilities, indicating strong cash or receivables positions relative to payables. Although detailed cash flow statements are not provided, the current asset to liability ratio implies that operational cash flow is likely sufficient to meet immediate obligations. Absence of employees means low payroll cash outflow, further supporting liquidity.

4. Monitoring Points:

• Watch for any deterioration in net current assets or increase in liabilities that could stress liquidity.
• Monitor turnover and profitability trends as profit and loss data is not available; declining profits could impair equity.
• Review any changes in management or director appointments for potential governance risks.
• Ensure continued timely filing of accounts and confirmation statements to avoid compliance issues.
• Given the micro entity status and limited fixed assets, assess any future need for capital investment or external financing carefully.