INVICTA DIGITAL LTD

Executive Summary

Invicta Digital Ltd exhibits modest financial strength with positive net assets but declining equity and tight liquidity. The company can service current liabilities but has limited cash reserves, suggesting vulnerability to cash flow fluctuations. Credit approval is recommended on a conditional basis with close monitoring of liquidity and profitability metrics.

INVICTA DIGITAL LTD - Analysis Report

Company Number: 13653784

Analysis Date: 2025-07-29 18:59 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Invicta Digital Ltd is an active private limited company operating in the advertising agency sector. The company shows positive net current assets and shareholders’ funds, indicating a baseline capacity to meet short-term liabilities. However, the company’s small absolute size of cash reserves (£4,891 as of 31 August 2024) versus current liabilities (£2,986) suggests limited liquidity cushion. The decline in net assets and shareholders’ funds from £4,554 in 2023 to £3,079 in 2024 indicates some erosion of capital, possibly due to operational losses or asset write-downs. Given these factors, credit approval is recommended but with conditions such as monitoring liquidity closely and possibly requiring personal guarantees or collateral.

2. Financial Strength:
   The balance sheet shows modest fixed assets (£1,174) and net current assets of £1,905 as of the latest year-end. Shareholders’ funds have declined by approximately 32% year-over-year, from £4,554 in 2023 to £3,079 in 2024, reflecting deteriorated retained earnings. The company has low tangible fixed assets and minimal cash holdings, but no long-term debt reported. The overall financial strength is weak to moderate with limited buffer against adverse events. The company remains solvent but has constrained equity and liquidity profiles typical of early-stage or micro-sized businesses.

3. Cash Flow Assessment:
   Cash at bank decreased from £6,260 to £4,891 in the last year, signaling potential cash outflows exceeding inflows. Current liabilities have slightly decreased, improving net current assets but the absolute cash balance is low relative to liabilities. This suggests tight working capital management and potential vulnerability to unexpected expenses or revenue shortfalls. The company’s working capital is positive but modest, and there is a reliance on continued cash generation or external funding to maintain operations.

4. Monitoring Points:

• Liquidity trends, particularly cash balances against short-term liabilities, to identify any emerging cash flow stress.
• Profitability or loss trends to understand drivers of declining shareholders’ funds.
• Timely filing of accounts and confirmation statements (currently up to date).
• Any material changes in the scope of business or capital structure that could impact creditworthiness.
• Director conduct and any changes to ownership or control that might affect governance or credit risk.