JK LABS LTD

Executive Summary

JK LABS LTD shows a strengthening financial position with growing net assets and strong working capital, supporting an approval of credit facilities. The company’s liquidity appears solid, and management compliance is satisfactory. Continued monitoring of cash flow and receivables is advised to maintain credit quality as the business scales.

JK LABS LTD - Analysis Report

Company Number: 13226563

Analysis Date: 2025-07-29 14:43 UTC

1. Credit Opinion: APPROVE with monitoring
   JK LABS LTD demonstrates solid growth in net assets and working capital over the latest two years, indicating an improving financial position. The company has increased current assets significantly while managing liabilities prudently. The directors have maintained compliance with filing requirements, and there are no signs of distress or adverse director conduct. Given the company’s relatively young age (incorporated 2021) and modest scale, credit facilities can be approved with monitoring of cash flow and receivables for continued operational stability.

2. Financial Strength:
   The balance sheet shows strong improvement from 2022 to 2023:

• Net assets increased from £298.4k to £441.0k, reflecting retained earnings and capital growth.
• Fixed assets grew modestly from £670 to £3,035, suggesting some investment in long-term resources but no overextension.
• Current assets nearly doubled from £342.7k to £615.3k, providing ample liquidity.
• Current liabilities increased but remain well-covered by current assets, with net current assets rising to £437.9k from £297.8k.
  This financial structure indicates a healthy equity base and good asset coverage, supporting creditworthiness.

3. Cash Flow Assessment:
   The large increase in current assets, primarily cash or equivalents and receivables, coupled with manageable current liabilities, suggests positive short-term liquidity and working capital management. The net current assets position is strong, showing the company can meet short-term obligations without stress. However, detailed cash flow statements were not provided, so ongoing monitoring of cash conversion cycles and debtor aging is recommended to ensure liquidity remains robust as the company grows.

4. Monitoring Points:

• Monitor trade receivables closely to avoid potential liquidity issues.
• Keep an eye on current liabilities growth relative to current assets to maintain strong working capital.
• Review future financials for profitability trends as the company matures beyond its startup phase.
• Watch for any changes in director status or control that could impact governance or risk profile.