KARL MCFEELY REFURBISHMENTS LTD

Executive Summary

Karl Mcfeely Refurbishments Ltd shows signs of financial distress with negative working capital and eroded equity, undermining its ability to meet short-term obligations. The company’s limited asset base and shrinking trade receivables raise concerns about business viability and cash flow stability. Given these factors, credit approval is not recommended at this stage without further mitigating information.

KARL MCFEELY REFURBISHMENTS LTD - Analysis Report

Company Number: 12520168

Analysis Date: 2025-07-29 17:51 UTC

1. Credit Opinion: DECLINE
   Karl Mcfeely Refurbishments Ltd presents a weak credit profile. The company’s net current assets have turned negative in the latest period (£-265), indicating potential liquidity strain. Shareholders funds have significantly eroded from £2,693 in 2023 to just £236 in 2024. The company's ability to service debt and meet short-term obligations appears impaired, raising concerns about repayment capacity. The absence of any material fixed assets and negligible share capital (£1) further weaken its financial standing. Additionally, the company operates as a single-person entity with no indication of diversification or scale, increasing business risk.

2. Financial Strength:
   The balance sheet reflects a small-scale operation with limited financial resources. Tangible fixed assets are minimal (£501 net book value), and the company holds very little equity. The sharp decline in net assets and shareholders funds over the last year suggests accumulated losses or write-downs, pointing to deteriorating financial health. Current liabilities (£16,618) slightly exceed current assets (£16,353), resulting in a negative working capital position. The company relies heavily on cash (£15,909), but the decline in debtors from £12,430 to £444 may indicate reduced sales or collection issues.

3. Cash Flow Assessment:
   While the firm maintains a cash balance of approximately £15.9k, the negative net current assets reveal that cash alone may not be sufficient to cover all short-term liabilities. The significant drop in trade debtors and reduction in current assets compared to the prior year suggest weakening operational cash inflows. The company’s cash flow dynamics appear unstable, with potential pressure to meet creditor demands or unexpected expenses. No indication of external financing or credit lines is evident, which limits liquidity flexibility.

4. Monitoring Points:

• Track improvements or further deterioration in net current assets and shareholders funds at the next reporting date.
• Monitor cash flow trends and debtor collections to ensure operational liquidity.
• Watch for any new secured or unsecured borrowing that may impact financial risk.
• Assess management’s strategic plans to restore profitability and strengthen the balance sheet.
• Review any changes in director appointments or company status that may signal governance issues.