KBRANCH PROPERTIES LTD

Executive Summary

KBRANCH PROPERTIES LTD shows a fragile financial position characterized by negative net assets and minimal working capital, indicating limited capacity to service additional debt. The company’s micro-entity status and lack of profitability create a high credit risk profile. Without significant improvements in capital structure or operational cash flows, extending credit is not advisable at this time.

KBRANCH PROPERTIES LTD - Analysis Report

Company Number: 14071033

Analysis Date: 2025-07-29 15:41 UTC

1. Credit Opinion: DECLINE
   KBRANCH PROPERTIES LTD exhibits weak financial health with persistent net liabilities and negative shareholders’ funds over the last two years. The company’s net assets remain negative (£-1,213 in 2024), reflecting more liabilities than assets, which undermines its ability to service additional debt. The micro-entity size and limited financial data, combined with the negative equity position, increase credit risk. Without significant improvement in capital structure or profitability, the company is not a suitable candidate for new credit facilities.

2. Financial Strength:
   The balance sheet shows total assets less current liabilities around £45,000, but this is offset by long-term creditors of £46,300, resulting in negative net assets. Current assets and current liabilities are nearly matched, indicating minimal working capital cushion. The company's small scale (micro category) and single director ownership suggest limited financial flexibility. The negative equity position implies the company is either relying on external financing or has accumulated losses not covered by capital.

3. Cash Flow Assessment:
   Current assets (£46,287) roughly equal current liabilities (£1,200 reported as short-term creditors, which appears understated given the mismatch in net current assets reported), but note that the accounts show net current assets as positive (£45,087), which may reflect an accounting aggregation or a misstatement in the report. The small size and micro-entity status limit visibility into cash flows, but the minimal working capital and negative net assets raise concerns about liquidity and operational cash flow sufficiency. The company’s ability to generate positive operating cash flow and meet short-term obligations is uncertain.

4. Monitoring Points:

• Track changes in net assets and equity position to assess any capital injections or profit improvements.
• Review upcoming financial statements for signs of cash flow improvement or reduction in liabilities.
• Monitor director’s involvement and any external financing arrangements that could impact credit risk.
• Watch for overdue filings or late payments that could signal financial distress.