JH AUTO DEVELOPMENTS LTD

Executive Summary

JH AUTO DEVELOPMENTS LTD is an active micro-entity in the vehicle maintenance sector showing gradual improvement in net assets but ongoing liquidity concerns due to negative net current assets. The company’s small scale and limited capitalization highlight operational risks, though compliance and fixed asset investment are positive signs. Further examination of cash flow and liability structure is recommended to fully assess financial resilience.

JH AUTO DEVELOPMENTS LTD - Analysis Report

Company Number: 12688630

Analysis Date: 2025-07-20 18:23 UTC

1. Risk Rating: MEDIUM
   The company shows positive net asset growth and solvency improvement, but persistent negative net current assets and low scale of operations warrant caution.

2. Key Concerns:

• Liquidity Risk: The company consistently reports negative net current assets (current liabilities exceed current assets), implying potential short-term cash flow constraints. Although the net current liability position improved slightly in 2024, it remains significant at £22,192.
• Scale & Capitalization: With minimal share capital (£1) and micro-entity status, the company’s financial buffer is limited, potentially restricting capacity to absorb shocks or fund growth.
• Operational Dependence: The business is very small, employing only one person (the director), which raises concerns about operational resilience and succession risk.

3. Positive Indicators:

• Improving Net Assets: Net assets increased from £3,138 in 2023 to £5,296 in 2024, indicating gradual strengthening of equity.
• No Overdue Filings: Accounts and confirmation statements are filed on time, demonstrating regulatory compliance and good governance.
• Stable Fixed Assets Base: Fixed assets have grown steadily from £19,376 in 2020 to £27,488 in 2024, suggesting ongoing investment in core operational capacity.
• Active Website & Contact Info: Presence of an active website with contact details and social media indicates engagement with customers and market visibility.

4. Due Diligence Notes:

• Investigate the nature and timing of current liabilities to assess whether they are manageable or indicative of cash flow stress.
• Review cash flow statements and bank balances if available, to confirm liquidity position beyond balance sheet snapshots.
• Understand revenue trends, client base, and contract stability given the small size and sector (vehicle maintenance and repair).
• Confirm if the director’s role as sole employee impacts business continuity risk and whether there are contingency plans.
• Verify any related party transactions or director loans that might affect financial stability.