LCR PROPERTY SERVICES LTD

Executive Summary

LCR Property Services Ltd is a small, active construction services company exhibiting recent financial weakening with net assets declining sharply and increased liabilities. While current liquidity is positive, the balance sheet is thinly capitalized and reliant on effective cash flow management. Credit approval is possible but should be conditional on ongoing monitoring of liquidity, debt levels, and operational performance to mitigate risk.

LCR PROPERTY SERVICES LTD - Analysis Report

Company Number: 13019158

Analysis Date: 2025-07-20 18:35 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   LCR Property Services Ltd is an active micro private limited company in the specialised construction sector. The company demonstrates continuity in operations since incorporation in late 2020 with no overdue filings. However, recent financial data show a significant decline in net assets from £23,037 in 2023 to £1,619 in 2024, primarily driven by an increase in long-term creditors (£25,558) and a reduction in current assets (£27,819). While the firm currently maintains positive net current assets (£5,447), the sharp drop in equity and increase in liabilities suggests some financial strain. Credit approval can be considered but should be conditional on close monitoring of cash flow and debt servicing capability.

2. Financial Strength:
   The company’s balance sheet at 30 November 2024 shows limited fixed assets (£21,730) and modest current assets (£27,819). Current liabilities stand at £22,372, leaving positive working capital. However, long-term liabilities have risen to £25,558, which reduces net equity substantially. The net asset position is marginal at £1,619, reflecting thin capitalization and limited buffer against financial shocks. The prior two years displayed healthier net asset positions, indicating a recent weakening in financial strength. The capital structure relies on modest share capital (£100) and accumulated reserves that have diminished. Overall, the balance sheet is fragile and dependent on stable cash flow.

3. Cash Flow Assessment:
   Working capital remains positive but reduced from £43,037 in 2023 to £5,447 in 2024, signaling tighter liquidity. The company employs just two staff on average, indicating low fixed overheads which may help cash flow. However, the rise in creditors due after one year (long-term liabilities) from £20,000 to £25,558 suggests increased borrowing or deferred payments. The limited fixed assets and micro entity status imply limited collateral. Cash flow management will be critical to meet both short-term liabilities and upcoming long-term obligations. The absence of audit and limited disclosure restrict detailed cash flow analysis, so bank statements or management accounts should be reviewed for up-to-date liquidity status.

4. Monitoring Points:

• Quarterly review of cash flow forecasts and bank balances to ensure liquidity remains positive.
• Tracking changes in current and long-term liabilities to avoid overleveraging.
• Watch for any overdue filings or director changes that may indicate operational issues.
• Monitor gross profit margins and revenue trends if available to assess business viability.
• Keep an eye on shareholder equity trends and any capital injections or withdrawals.
• Review any related party transactions or director loans that may impact financial stability.