Credit Analysis: JBPM Online Limited

1. Credit Opinion: APPROVE

This business presents a strong credit profile. Net assets have grown consistently from £27,573 (2016) to £683,700 (2025), demonstrating sustained profitability and prudent retention of earnings. Cash reserves of £532,977 significantly exceed total liabilities of £134,612, providing substantial debt service capacity. The company operates with minimal bank borrowings (£13,366) and has a current ratio of approximately 4.9x, indicating excellent liquidity. The 15-year trading history and improving balance sheet support confidence in repayment ability.

2. Financial Strength

Balance Sheet Summary (FY2025): | Item | £ | YoY Change | |------|---|------------| | Net Assets | 683,700 | +25.2% | | Cash | 532,977 | +48.1% | | Net Current Assets | 526,048 | +33.3% | | Total Liabilities | 134,612 | -25.2% | | Shareholders' Funds | 683,700 | +25.2% |

Key Strengths: - Equity base has compounded significantly: Net assets grew from £27,573 (2016) to £683,700 (2025) – a 24x increase over nine years, reflecting consistent profit retention - Virtually debt-free: Bank borrowings represent less than 2% of total liabilities; the business is self-funding - Tangible asset backing: Leasehold property (£106,713 NBV) and equipment (£50,939 NBV) provide real asset value - Minimal leverage: Liabilities are only 16.4% of net assets

Estimated Profitability: Based on movement in shareholders' funds (absent a P&L in filleted accounts): - FY2025 retained profit: ~£137,488 - FY2024 retained profit: ~£93,073 - FY2023 retained profit: ~£92,724

This trajectory indicates accelerating earnings, a positive signal.

3. Cash Flow Assessment

Liquidity Position: | Metric | FY2025 | FY2024 | |--------|--------|--------| | Current Ratio | 4.9x | 3.2x | | Cash as % of Current Assets | 80.7% | 62.6% | | Cash as % of Total Liabilities | 395.9% | 200.0% |

Working Capital Observations: - Trade debtors decreased sharply from £141,679 to £45,429 (-68%). This likely reflects improved collections or a shift in revenue mix, though could indicate lower turnover in the period - Trade creditors reduced from £125,902 to £39,139 (-69%), suggesting the company is paying suppliers promptly or purchasing less - Stock increased modestly from £73,021 to £82,254, which appears manageable - Taxation and social security liabilities rose from £29,500 to £82,107, consistent with higher profitability triggering larger Corporation Tax provisions

Cash Generation: Cash increased by £172,003 year-on-year despite capital expenditure of £35,153 on equipment. This demonstrates strong operating cash flow conversion.

4. Monitoring Points