LIGHTNING FLASH TRANSPORT LTD

Executive Summary

Lightning Flash Transport Ltd demonstrates improving net asset value and shareholder funds, indicating underlying profitability and retained earnings growth. However, the significant increase in liabilities and reduction in cash reserves create moderate liquidity risk. Conditional credit approval is recommended with close monitoring of cash flow, creditor management, and overall financial performance.

LIGHTNING FLASH TRANSPORT LTD - Analysis Report

Company Number: 13046307

Analysis Date: 2025-07-20 13:12 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Lightning Flash Transport Ltd shows a positive growth trajectory in net assets and shareholder funds, doubling net assets from £5,035 in 2022 to £10,601 in 2023. However, the company remains very small, with only one employee and minimal fixed assets, and the cash balance has significantly decreased (£6,085 to £2,531). The increase in creditors, especially current liabilities rising from zero to £3,419 and long-term creditors appearing at £2,650, suggests rising short and medium-term obligations. Approval is conditional on continued close monitoring of liquidity and creditor payment terms to ensure timely servicing of debts.

2. Financial Strength:
   The company’s balance sheet is modest but strengthening. Net assets have improved, indicating retained earnings growth (profit and loss reserves increased from £5,035 to £10,601). The rise in current liabilities from zero to £3,419 suggests increased operational or financing activity, perhaps reflecting business expansion or delayed payments. The presence of creditors due after one year (£2,650) introduces some medium-term obligations. Overall, equity covers liabilities comfortably, but asset base remains lean, so financial strength is limited by scale and asset diversity.

3. Cash Flow Assessment:
   Cash reserves have declined by over 50% from £6,085 to £2,531, which is a concern given the rise in current liabilities. While net current assets remain positive (£7,951), this is largely due to recognition of debtors (£2,001) and other current assets. The company needs to manage working capital carefully to avoid liquidity strains. Given the small size and single employee, cash flow volatility could impact timely debt repayment. No audit or detailed profit and loss figures are provided, limiting deeper cash flow analysis.

4. Monitoring Points:

• Liquidity trends: Watch cash balances and debtor collection efficiency closely.
• Creditor payment behavior and terms: Current and long-term liabilities have increased; monitor how these are managed.
• Profitability: Although retained earnings have grown, absence of income statement data warrants regular review.
• Business scale and employee numbers: Currently minimal, indicating limited operational capacity; growth may require capital or operational strengthening.
• Director conduct and governance: No negative flags; director has been in place since incorporation.