Company Number: 12416517

Analysis Date: 2025-07-29 20:58 UTC

1. Credit Opinion: APPROVE
   Invevo Limited demonstrates strong financial health with substantial net assets (£2.79m as of 31 Dec 2023) and a significant increase in net current assets from prior years, indicating enhanced liquidity and ability to meet short-term obligations. The company operates in business and domestic software development, a sector with growth potential. The absence of overdue filings and no indications of financial distress or liquidation further supports creditworthiness. The presence of related party debtors should be monitored but currently does not impair financial strength. Overall, the company shows sound management and financial stewardship, justifying approval for credit facilities.

2. Financial Strength:
   The balance sheet reflects robust growth in net assets from £679k in 2022 to £2.79m in 2023, driven by increased current assets, primarily debtors (£4.1m) and cash (£121k), exceeding current liabilities (£546k). Fixed assets remain modest (£9k), consistent with a software company’s asset-light model. Long-term borrowings have decreased but remain at £794k, manageable given the asset base. The company’s shareholders’ funds have grown significantly, supported by a large share premium reserve, indicating successful capital raising. The financial trajectory is positive, showing strong equity buildup and improved solvency.

3. Cash Flow Assessment:
   Current assets well exceed current liabilities, yielding net current assets of £3.67m, indicating healthy working capital and liquidity. However, cash on hand has decreased slightly from £149k to £121k, which warrants monitoring for operational cash flow sufficiency. Debtors include a large portion (£3.36m) owed by related parties, which could pose collection risk if not managed properly. The company’s ability to convert receivables into cash timely is critical. No signs of payment distress are evident, but ongoing scrutiny of debtor ageing and cash conversion cycles is recommended.

4. Monitoring Points:

• Debtor concentration and collectability, especially amounts owed by related parties.
• Cash flow trends and liquidity ratio to ensure operational expenses and debt servicing can be met without strain.
• Borrowings level and repayment schedule, given the £794k long-term loans outstanding.
• Directors’ remuneration and potential changes in management, considering a recent director appointment in August 2024.
• Industry developments impacting software development demand and competitive positioning.