JEROBOAMS PROPERTIES LIMITED

Executive Summary

Jeroboams Properties Limited is a newly established property investment company with significant assets funded mainly through related party loans, resulting in a modest equity base and a slight working capital deficit. While the company’s asset portfolio appears sound, its cash flow and independent debt servicing ability are unproven, necessitating conditional credit approval with close monitoring of rental income and group funding commitments. Continued oversight of financial performance and liquidity metrics is recommended before considering any increase in credit facilities.

JEROBOAMS PROPERTIES LIMITED - Analysis Report

Company Number: 15265502

Analysis Date: 2025-07-29 13:34 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Jeroboams Properties Limited is a recently incorporated small private limited company engaged in investment property letting. Its financial statements to 31 March 2024 show substantial investment property assets (£3.8m) funded mainly by intra-group debt (£3.7m). The company’s net asset position is modest (£61.7k) but positive. However, there is a net current liability position of £1.9k, and the large creditor balance due after one year is owed to a group undertaking, indicating reliance on group funding. There is no trading history beyond the initial period, and no profit & loss data was filed. Given these factors, credit approval should be conditional on continued support from the parent group and monitoring of cash flow and income generation from the investment property. The company’s ability to service external debt independently remains unproven.

2. Financial Strength
   The company’s balance sheet is dominated by investment property at fair value of £3.8m, which has been internally valued by experienced directors. The equity base is minimal, with share capital of £1k and reserves of £60.7k, including a fair value adjustment reserve. Current assets of £26.3k (mainly cash) are dwarfed by current liabilities of £28.2k, giving a slight working capital deficit. The key long-term liability is the intra-group loan of £3.7m, reflecting dependency on group funding rather than third-party financing. No external borrowings are evident. Overall, the balance sheet is asset-rich but equity-thin and reliant on related party funding.

3. Cash Flow Assessment
   Cash on hand as at year-end is £21.4k, which covers short-term liabilities of £28.2k only partially, resulting in a net current liability position. The company has no employees and presumably low operational costs. Income from the investment property is recognized on a straight-line basis, but no income statement was filed, so cash flow from operations cannot be confirmed. The absence of external debt repayments suggests limited immediate liquidity pressure; however, future cash flow adequacy depends on rental income and receipt timings. Continued cash flow support from the parent or related parties is critical during the early trading phase.

4. Monitoring Points

• Rental income and occupancy rates on the investment property to ensure steady cash inflows
• Changes in related party loan balances, especially repayment terms or calls for additional funding
• Timely filing of subsequent accounts including profit & loss statements to assess trading performance
• Working capital trends and any increase in trade creditors or other liabilities
• Management decisions on asset disposal or further property acquisitions affecting liquidity and leverage