Company Number: 12507855

Analysis Date: 2025-07-20 12:49 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   HOLM* Studio Ltd shows modest net asset growth and positive working capital as of the most recent year-end, indicating some financial improvement. However, the company’s liquidity has declined from prior years, with cash balances falling significantly and current liabilities remaining relatively high. The business operates in a niche artistic creation sector with limited tangible fixed assets and a sole director-owner, creating concentration risk. Credit approval is recommended subject to monitoring liquidity and debtor collections closely, and potentially requiring personal guarantees or collateral given the small equity base and limited cash resources.

2. Financial Strength:
   The balance sheet reflects a small but improving net asset position: £2,335 in 2024 vs. £1,756 in 2023. Tangible fixed assets have decreased to £5,117, reflecting depreciation exceeding additions. Net current assets have turned positive (£1,309) from negative the previous year (-£3,547), indicating improved short-term financial health. However, provisions for liabilities increased markedly to £4,091, which may suggest contingent or accrued expenses affecting net assets. Share capital is nominal (£1), with all equity coming from retained earnings. Overall, the company is financially fragile but shows signs of stabilisation.

3. Cash Flow Assessment:
   Cash reserves declined from £19,749 in 2023 to £11,175 in 2024, a significant reduction that impacts liquidity. Debtors increased to £5,682 in 2024 from zero previously, introducing some credit risk and potential cash flow timing issues. Current liabilities remain substantial at £15,548, including trade creditors (£6,576) and taxation/social security liabilities (£6,861), indicating ongoing operational payables. Net current assets turned slightly positive, but working capital remains tight. The company’s ability to generate sufficient cash to meet short-term obligations may be constrained, requiring close monitoring.

4. Monitoring Points:

• Cash and working capital trends: Watch for further cash depletion or improvements in debtor collections.
• Provisions for liabilities: Clarify nature and timing to assess impact on liquidity and solvency.
• Trade creditor payment patterns: Ensure timely supplier payments to avoid supply chain disruption.
• Director and ownership concentration risk: Consider impact on governance and decision-making.
• Business performance indicators: Revenue growth, profitability, and cost control to assess sustainability.