Company Number: 13667028

Analysis Date: 2025-07-20 11:55 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   K J Cox Limited is a small private limited company in the construction sector with a short trading history (incorporated 2021). The latest accounts show a decline in net assets and a negative net current asset position, indicating working capital stress. The company’s cash balance is stable but insufficient to fully cover short-term liabilities. Given these liquidity constraints and the small scale of operations (1 employee), credit approval should be conditional on monitoring cash flow closely and requiring up-to-date management accounts.

2. Financial Strength:
   The company’s net assets have decreased from £22,527 in 2023 to £8,509 in 2024, primarily due to an increase in current liabilities (£28,041 to £33,913) and a reduction in fixed assets (£25,620 to £20,496). The share capital remains nominal (£100), and equity is largely retained earnings. Negative net current assets of £11,987 in 2024 versus £3,093 in 2023 signal liquidity pressure. The company’s balance sheet is thinly capitalised, and the drop in working capital is a concern for financial resilience.

3. Cash Flow Assessment:
   Cash on hand is £21,926 at 2024 year-end, consistent with previous year levels, but current liabilities exceed cash and receivables combined, resulting in a working capital deficit. Trade creditors are low (£2,400), but tax and social security liabilities are significant (£24,977), suggesting potential timing issues in meeting statutory payments. The company employs only one person, limiting payroll outgoings. Overall, the liquidity position is tight, requiring careful cash flow management to meet short-term obligations.

4. Monitoring Points:

• Monitor working capital trends and ensure current liabilities do not further outpace current assets.
• Review monthly cash flow forecasts and management accounts for early signs of liquidity stress.
• Track payment of tax and social security obligations to avoid penalties or enforcement.
• Monitor any changes in contract volumes or payment terms in the domestic and commercial construction sectors.
• Keep watch on fixed asset disposals or capital expenditure that could impact operational capacity.