Company Number: 13666954

Analysis Date: 2025-07-19 13:03 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Lederton Properties Ltd is a recently incorporated private limited company primarily engaged in letting and operating its own or leased real estate. The company shows a moderate asset base with investment property valued at £1.35 million. However, the company carries significant secured debt (£1.01 million bank loan) due in more than five years. The net assets of £543,689 provide some equity cushion. While the company meets filing obligations and is active with no overdue filings, cash levels are low (£10,625), and debtors are high (£861,200), which may indicate receivables concentration risk or delayed cash conversion. The financial statements are unaudited and prepared under the small entities regime, limiting disclosure. Overall, the company’s ability to service debt depends heavily on rental income and timely collection of debtors. Approval is recommended subject to monitoring cash flow and debtor collection closely.

2. Financial Strength:
   The balance sheet shows total fixed assets (investment property) of £1.35 million and current assets of £871,825, predominantly debtors. Current liabilities of £478,767 are well covered by current assets, resulting in positive net current assets of £393,058, which indicates adequate short-term liquidity. However, the company has a substantial long-term bank loan (£1.01 million) secured against assets. Shareholders’ funds stand at £543,689, with retained losses of £13,542 offset by non-distributable reserves of £557,230. The company is solvent with net assets positive but has leveraged itself significantly via debt. The deferred tax provision (£185,744) is noted but does not affect equity.

3. Cash Flow Assessment:
   Cash at bank is minimal at £10,625, which is low relative to current liabilities due within one year (£478,767). Debtors form the bulk of current assets (£861,200), which presents liquidity risk if collection is delayed or impaired. The company’s working capital position is positive (£393,058), but liquidity depends on converting debtors to cash in a timely manner. No income statement is filed to assess profitability or cash generation from operations. The heavy reliance on rental income and debtor collection for cash flow to service bank loans and operational expenses presents risk. An assessment of rent roll, lease terms, and debtor ageing is recommended.

4. Monitoring Points:

• Debtor ageing and collection efficiency to ensure liquidity is maintained
• Rental income stability and occupancy rates of investment property
• Timely servicing of bank loan interest and principal payments
• Changes in property valuation and market conditions affecting asset collateral value
• Any changes in director or shareholder control that might affect governance or financial strategy
• Filing of profit and loss accounts or audited statements in future years for better financial transparency