Company Number: 13645612

Analysis Date: 2025-07-20 13:40 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Jackson Pullin Properties Ltd operates in the property investment sector with a relatively short trading history since incorporation in 2021. The company holds investment property valued at £590,000 as of 2024, financed mainly through secured bank loans (£319,693) and director loans (£153,578). While net assets have improved notably from £48,776 in 2023 to £96,734 in 2024, the company exhibits significant working capital deficits (net current liabilities of £149,614 in 2024) and has minimal cash reserves (£4,444). The reliance on director loans and secured borrowing indicates moderate financial risk, but the upward fair value adjustment of property assets is a positive sign. Approval is recommended subject to monitoring liquidity and confirming ongoing rental income or other cash inflows to service debt obligations.

2. Financial Strength:
   The balance sheet shows growth in net assets primarily driven by a substantial revaluation gain on investment property (£63,892 increase in fair value). Fixed assets (investment property) represent the bulk of total assets (£590,000), secured against bank loans of £319,693, indicating a loan-to-value ratio of approximately 54%, which is reasonable for secured lending. However, the company’s current liabilities exceed current assets by a large margin, reflecting a working capital deficit. Shareholders' funds have doubled year-on-year, signaling improving equity, but the negative profit and loss reserve (-£5,409) suggests accumulated losses or limited retained earnings. The absence of employees and the nature of the business imply limited operational expenses but also limited diversification of income.

3. Cash Flow Assessment:
   Cash balances remain low and have decreased slightly from £6,364 in 2023 to £4,444 in 2024. The current liabilities are largely composed of loans from directors (£153,578) and accruals, while longer-term liabilities consist of bank loans secured on the property. The company’s ability to meet short-term obligations is constrained, highlighting liquidity risk. There is no indication of operating cash flow from trading, suggesting that income may be rental-based or dependent on capital appreciation. Continued reliance on director loans may pose risks if these are withdrawn. Monitoring cash inflows, particularly rental income or refinancing options, is critical to ensure debt servicing capability.

4. Monitoring Points:

• Liquidity trends: Monitor cash flow and net current liabilities to ensure the company can meet short-term obligations without additional director loans.
• Property market conditions: The company's asset base depends heavily on property valuations; adverse changes could impair collateral value and financial position.
• Debt servicing: Review timely repayment of bank loans and director loans, and confirm rental income or other revenues that support debt servicing.
• Profitability and reserves: Track movement in retained earnings and ensure the company moves toward sustainable profitability to strengthen equity.
• Director conduct and support: Consider the role and ongoing financial support from directors given their significant loan exposure.