Company Number: 13885282

Analysis Date: 2025-07-29 20:26 UTC

1. Credit Opinion: DECLINE
   LG Willowbrook Ltd exhibits significant liquidity and solvency concerns. Current liabilities (£299,864) vastly exceed current assets (£10,900) leading to a severely negative working capital position (-£288,964) as of Feb 2024. Net assets have eroded sharply from £86,214 in 2023 to only £6,036 in 2024. The company is highly leveraged with secured hire purchase debt of £90,000 (£45k current + £45k long-term). The negative trend and tight cash position imply limited ability to service debt or meet short-term obligations without additional capital or refinancing. No audit and limited disclosure reduce assurance on financial stewardship. Given these factors, credit risk is high and approval for new credit facilities is not recommended at this time.

2. Financial Strength:
   The balance sheet shows a small asset base dominated by fixed assets (£340k) including motor vehicles and investments, but current liabilities nearly 30 times current assets. The rapid increase in creditors from £137k to £300k and the addition of hire purchase debt indicate growing reliance on external funding. Shareholders’ funds have diminished drastically, suggesting operating losses or write-downs, weakening equity buffer. The company is classified as small and is relatively newly incorporated (2022), which compounds risk due to limited trading history.

3. Cash Flow Assessment:
   Cash on hand is negligible (£23), and debtors have reduced slightly but remain insufficient to cover immediate liabilities. The negative net current assets highlight working capital deficits, implying reliance on external financing to fund operations. The hire purchase liabilities secured on fixed assets suggest limited liquidity flexibility. The absence of a profit and loss account limits insight into operational cash flow, but the balance sheet signals ongoing cash flow stress.

4. Monitoring Points:

• Track monthly cash flow and debtor collections to assess liquidity improvement.
• Monitor creditor balances and any increases in trade or hire purchase debt.
• Review forthcoming accounts for evidence of operational profitability or further equity injections.
• Watch for changes in management strategy or capital structure that could mitigate solvency risk.
• Ensure timely filing of accounts and transparency to reduce informational risk.