Company Number: 13266200

Analysis Date: 2025-07-20 12:41 UTC

1. Risk Rating: HIGH

Justification: The company shows persistent negative net assets and shareholder funds, with significant current liabilities greatly exceeding current assets, reflecting a strained working capital position. The reliance on related party and director loans to finance operations indicates potential liquidity stress and solvency risk.

2. Key Concerns:

• Negative net assets and shareholder funds over multiple years (approx. -£24k in 2025), indicating accumulated losses and erosion of equity.
• Current liabilities (£775k) vastly exceed current assets (£31k), resulting in a large negative net current assets figure (-£744k), signaling liquidity constraints and potential cash flow difficulties.
• Significant related party and director loans (£775k combined), which may imply dependence on insider funding and possible difficulties in securing external finance or generating sufficient operating cash flow.

3. Positive Indicators:

• The company owns tangible fixed assets (mainly land and property) with a net book value of approximately £720k, which provides some asset backing.
• The company has filed accounts and confirmation statements on time with no overdue filings, demonstrating regulatory compliance and governance diligence.
• Presence of a revaluation reserve (£15k), showing some recognition of asset appreciation.

4. Due Diligence Notes:

• Investigate the nature and terms of the director's loan account and related party debts, including interest rates, repayment schedules, and any potential liabilities for the company.
• Review underlying cash flow forecasts and business model viability given the recurring negative working capital and net asset position.
• Confirm the valuation and marketability of the fixed assets to determine their realizable value in a potential distress scenario.
• Assess potential contingent liabilities or off-balance sheet exposures not disclosed in the accounts.
• Review the operational performance and revenue streams, as turnover and profitability details are not provided.