Company Number: 13332330

Analysis Date: 2025-07-20 17:35 UTC

1. Credit Opinion: DECLINE
   LCKM LIMITED exhibits persistent negative net assets and net current liabilities over the last three years, indicating an ongoing capital deficiency and poor liquidity position. The company is unable to cover its short-term liabilities with current assets, raising concerns about its ability to meet debt obligations. The negative equity position suggests accumulated losses and weak financial resilience. Without significant improvement or external capital injection, the risk of default on credit facilities is elevated.

2. Financial Strength:
   The balance sheet reveals total net liabilities of £32,742 as at 30 April 2024, an improvement from £39,058 the prior year but still negative. Current assets of £228,367 are insufficient to cover current liabilities of £261,109, resulting in a working capital deficit. The company holds minimal share capital (£2.00), and shareholders’ funds remain negative. The absence of fixed assets indicates limited tangible collateral to support borrowing. Overall, the financial structure is fragile with little buffer against adverse events.

3. Cash Flow Assessment:
   While current assets have slightly increased year-on-year, the company’s inability to reduce current liabilities or generate positive net current assets suggests ongoing cash flow constraints. The lack of positive working capital implies a reliance on external financing or delayed creditor payments to sustain operations. The company’s cash conversion cycle and liquidity are questionable, which undermines confidence in its short-term cash flow sufficiency.

4. Monitoring Points:

• Track improvements in net current assets and net asset position to detect any movement towards positive equity.
• Monitor creditor aging and any delays in payments that could signal cash flow stress.
• Review turnover and profitability trends once available to assess operational viability.
• Observe any capital injections or changes in shareholder funding to shore up financial position.
• Keep watch on directors’ conduct and any governance changes that might impact credit risk.