Company Number: 14106313

Analysis Date: 2025-07-29 14:15 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns, reflected by persistent negative net current assets and shareholders' funds. The working capital deficiency and reliance on related party loans indicate elevated financial risk.

2. Key Concerns:

• Severe Working Capital Deficit: As of the latest accounts (2024), current liabilities (£569k) vastly exceed current assets (£30.5k), producing a net current liability of approximately £539k, worsening from the prior year.
• Negative Shareholders' Funds: The company’s equity position is negative (£-53k), indicating liabilities exceed total assets, which undermines solvency and may threaten going concern status without external support.
• Dependence on Related Party Loans: Large short-term loans from related parties (£274k from Staxson Ltd and £28.5k from a director) are critical for liquidity. The absence of interest and informal repayment terms heightens risk exposure to key stakeholders.

3. Positive Indicators:

• Investment Property Asset Base: The company holds investment property valued at £485k (up from £319k prior year), which could provide collateral value or future liquidity if realised.
• Timely Compliance: All statutory filings (accounts, confirmation statements) are up to date with no overdue reports, supporting regulatory compliance and governance discipline.
• Experienced Directors: Four directors appointed since incorporation with no adverse records reported, suggesting stable leadership presence.

4. Due Diligence Notes:

• Investigate the terms and enforceability of related party loans, including repayment schedules and any security interests.
• Review cash flow forecasts and management plans to address the significant working capital shortfall and negative equity situation.
• Assess the valuation methodology and liquidity of the investment property asset to determine its realistic contribution to solvency.
• Confirm absence of contingent liabilities or potential impending creditor actions given the financial strain.
• Verify directors’ statements regarding going concern assumptions and whether external funding support is secured.