Company Number: 13590822

Analysis Date: 2025-07-29 20:10 UTC

1. Credit Opinion: APPROVE with conditions

L G HEATING & GAS LIMITED demonstrates a stable financial position with positive net assets and net current assets at the latest year-end. However, the company is micro-sized and has a short trading history (since 2021), which limits the depth of financial data. The significant reduction in current assets from 2023 to 2024 merits monitoring. The single director and owner, Mr. Louis Gary Hobbs, shows consistent control but the limited operational scale and lack of profit and loss data filed introduce some uncertainty. Approval is recommended with conditions focusing on updated trading performance and cash flow verification.

2. Financial Strength:

• Net assets stand at £38,786 as of 31 August 2024, down from £42,822 in the prior two years, indicating a slight contraction.
• Fixed assets increased from £3,000 to £20,300, suggesting some investment in equipment or tools.
• Current assets dropped significantly from £55,336 (2023) to £29,649 (2024), while current liabilities decreased to £11,163 from £15,514, resulting in net current assets of £18,486.
• The company’s balance sheet shows positive working capital and shareholders’ funds fully supporting the asset base.
• Being a micro entity, no audit has been performed and no profit and loss account has been filed; hence profitability and earnings quality cannot be assessed.

3. Cash Flow Assessment:

• Current assets to current liabilities ratio is approximately 2.66x, indicating sound short-term liquidity.
• The reduction in current assets, particularly cash or receivables, may signal tighter working capital or cash outflows.
• With only one employee (the director) and limited liabilities, cash burn may be low but cash inflow sustainability is unknown.
• Absence of a profit and loss statement restricts evaluation of operational cash generation; further confirmation of cash flow from operations is advisable before increasing credit exposure.

4. Monitoring Points:

• Watch quarterly or interim cash flow statements to ensure liquidity remains sufficient.
• Monitor trade debtor aging if applicable to avoid collection delays.
• Track fixed asset additions to confirm they are productive investments and not cash drains.
• Review any upcoming filings of profit and loss accounts for trends in profitability and cost control.
• Keep watch on director’s engagement and any changes in ownership or management that may affect governance or risk profile.