KIRSCH SECURITIES LIMITED
Company number 00731323 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Credit Analysis: Kirsch Securities Limited
1. Credit Opinion: APPROVE
Rationale: Kirsch Securities Limited presents a compelling credit profile characterized by an exceptionally strong balance sheet, minimal leverage, and a long-established track record spanning over 60 years. Net assets of £5.73M against total liabilities of just £196,615 yields a gearing ratio of approximately 3.4% — well within conservative parameters. The consistent growth in retained earnings and shareholders' funds over the past decade demonstrates sound financial stewardship and reliable income generation from the property portfolio.
The company's property investment business model (SIC 68209) provides relatively stable cash flows through rental income, which supports debt serviceability. The primary consideration is asset liquidity — the investment property constitutes ~95% of total assets, meaning realisation timelines could be extended in a distressed scenario.
2. Financial Strength
Balance Sheet Summary (30 June 2025):
| Item | £ | % of Total Assets |
|---|---|---|
| Investment Property | 6,903,152 | 95.5% |
| Tangible Fixed Assets | 5,340 | 0.1% |
| Current Assets | 320,866 | 4.4% |
| Total Assets | 7,229,358 | 100% |
| Current Liabilities | (196,615) | |
| Provisions (Deferred Tax) | (1,305,992) | |
| Net Assets | 5,726,751 |
Key Observations:
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Minimal Leverage: No long-term debt facilities visible. Current liabilities of £196,615 consist solely of trade creditors and tax obligations. This is an exceptionally de-leveraged position.
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Asset Quality: The investment property portfolio is valued at £6.9M under the fair value model, comprising £4.29M in revaluation gains and £2.61M at historical cost. The revaluation reserve of £3.03M provides a substantial buffer against property value fluctuations.
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Provisions: The £1.31M provision represents deferred tax arising on property revaluation gains. This is a non-cash liability that crystallizes only upon disposal — standard for property investment companies.
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Capital Structure: Share capital of just £200 with retained earnings of £2.70M and revaluation reserve of £3.03M. The business has grown organically through retained profits — a positive indicator of management discipline.
Ten-Year Growth Trajectory:
| Year | Net Assets | YoY Growth |
|---|---|---|
| 2016 | £1,061,442 | — |
| 2017 | £1,351,997 | +27.4% |
| 2018 | £1,557,462 | +15.2% |
| 2019 | £1,725,347 | +10.8% |
| 2020 | £2,046,789 | +18.6% |
| 2021 | £2,214,600 | +8.2% |
| 2022 | £2,481,501 | +12.1% |
| 2023 | £2,584,547 | +4.2% |
| 2024 | £5,573,811 | +115.7% |
| 2025 | £5,726,751 | +2.7% |
The step-change in 2024 reflects property revaluation gains and acquisitions, not operational deterioration.
3. Cash Flow Assessment
Liquidity Position:
| Metric | 2025 | 2024 |
|---|---|---|
| Cash | £216,300 | £311,121 |
| Current Assets | £320,866 | £364,758 |
| Current Liabilities | £196,615 | £155,902 |
| Current Ratio | 1.63x | 2.34x |
| Net Current Assets | £124,251 | £208,856 |
Observations:
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Current Ratio: At 1.63x, the company maintains adequate short-term liquidity, though this has tightened from 2.34x in 2024. The decline warrants monitoring but remains within acceptable parameters.
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Cash Position: Cash has reduced by £94,821 (30.5%) year-on-year. This coincides with £358,224 in property additions during the period, suggesting strategic reinvestment rather than operational cash burn.
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Working Capital: Net current assets of £124,251 are modest relative to the overall balance sheet but sufficient for a property company with minimal trade creditor obligations. Rental income is typically received in advance, reducing working capital requirements.
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Related Party Balances: The company is owed £96,195 by companies under common control (up from £40,000). While not inherently problematic for a family group, this intercompany exposure should be monitored — recovery depends on the financial health of related entities.
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Tax Liability: Taxation and social security payable increased from £32,205 to £76,808, reflecting higher taxable income — consistent with growing rental income or property disposal gains.
Debt Serviceability: With no visible borrowings and growing retained earnings, the company has significant capacity to service new debt obligations. Rental income from a £6.9M property portfolio should comfortably support additional leverage if required.
4. Monitoring Points
| Metric | Current Position | Watch Threshold | Rationale |
|---|---|---|---|
| Current Ratio | 1.63x | <1.2x | Declining trend; further deterioration would signal liquidity pressure |
| Related Party Debtors | £96,195 | >£150,000 | Growing intercompany exposure; assess recoverability annually |
| Cash Position | £216,300 | <£100,000 | Ensure adequate liquidity for tax obligations and operational costs |
| Property Valuation | £6.9M fair value | >15% decline | Fair value model introduces volatility; monitor for impairment indicators |
| Provisions | £1.31M deferred tax | Significant increase | Crystalises on disposal; monitor for property disposal activity |
| Filing Compliance | Current | Any overdue filing | Ensure continued timely filing as indicator of management quality |
Additional Considerations:
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Accounting Period Change: The latest accounts cover a 15-month period (6 April 2024 to 30 June 2025), with the year-end changed from 5 April to 30 June. This should be considered when comparing year-on-year figures.
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Family Control: Three PSCs each holding 25-50% of shares and voting rights (Danielle Lisa Bond, Marc Kirsch, Brian Kirsch). Concentrated family ownership provides decision-making efficiency but creates key-person dependency.
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Director Disqualifications: No records identified for current directors.
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Property Market Risk: As a single-sector property company, the business is exposed to UK commercial/residential property market conditions. A significant correction could erode the revaluation reserve and trigger deferred tax liabilities.