JMC BRICKLAYERS LTD

Executive Summary

JMC Bricklayers Ltd shows a stable financial footing with positive net assets and tangible fixed assets supporting its operations. However, low cash balances relative to current liabilities and moderate long-term hire purchase debt highlight liquidity risks that require close monitoring. Conditional credit approval is recommended, subject to oversight of cash flow and working capital management.

JMC BRICKLAYERS LTD - Analysis Report

Company Number: 14125849

Analysis Date: 2025-07-20 15:57 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   JMC Bricklayers Ltd is a relatively new private limited company in the construction sector with active status and no liquidation concerns. The company maintains positive net assets and shareholders’ funds, indicating a basic level of financial stability. However, cash balances are extremely low (£510), and current liabilities exceed cash by a significant margin, which raises concerns about short-term liquidity. The company carries hire purchase debt of £27,107 due after one year, which is manageable given the net asset position but requires close monitoring. Given these factors, approval for credit facilities can be considered but with conditions such as regular cash flow reporting and possibly a limit on exposure until liquidity improves.

2. Financial Strength:
   The balance sheet shows total net assets of £21,839, down from £25,831 in the prior year, reflecting a slight decline but still positive equity. Fixed assets (plant and vehicles) at net book value of £36,626 represent significant investment in productive capacity. Current liabilities within one year stand at £11,810, with net current assets positive at £12,320. The presence of hire purchase liabilities totaling £27,107 (long-term debt) indicates moderate gearing. Overall, the company has a modest but stable financial base with tangible assets supporting its liabilities.

3. Cash Flow Assessment:
   Cash on hand is minimal (£510), which signals tight liquidity and potential cash flow constraints in meeting short-term obligations. Current liabilities exceed cash significantly, though net current assets remain positive due to other current assets (likely receivables or stock). The company’s ability to generate consistent cash flow from operations is critical, especially given the hire purchase commitments. The decline in net assets and reduced cash from previous year’s levels suggests cash flow may be under pressure. Monitoring working capital management and ensuring timely collections will be essential.

4. Monitoring Points:

• Cash balances and liquidity trends on a monthly basis
• Timely payment of current liabilities and hire purchase obligations
• Profitability and retained earnings movement in future accounts to assess growth or deterioration
• Management of receivables and payables to maintain or improve net current assets
• Impact of any new contracts or economic changes in the domestic construction sector on cash flow and asset utilization
• Director’s ongoing commitment and any changes in financial controls or strategy