LIMA STONE LTD

Executive Summary

Lima Stone Ltd is an early-stage real estate company with a weak financial position characterized by negative net assets and reliance on loans. While liquidity appears adequate in the short term, the absence of trading revenue and negative equity pose credit risks. Conditional credit approval is possible with safeguards such as director guarantees and close monitoring of financial performance and cash flows.

LIMA STONE LTD - Analysis Report

Company Number: SC679409

Analysis Date: 2025-07-20 13:31 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Lima Stone Ltd is an active private limited company operating in real estate letting and sales. The company shows limited financial history with recent years indicating a negative net asset position (£-18,431 as of 30 Nov 2022) due to outstanding loans of £40,000 split evenly between current and long-term liabilities. The absence of turnover and employees suggests a startup or holding company with limited trading activity. Credit approval would require conditions such as personal guarantees from controlling directors or evidence of incoming cash flows sufficient to service debt and operating costs. The negative equity and reliance on loans present a moderate credit risk.

2. Financial Strength: Weak
   The balance sheet reveals a fragile financial position with net liabilities and negative shareholders’ funds. Current assets of £21,569 (comprising £11,577 cash and £9,992 debtors) slightly exceed current liabilities of £20,000, resulting in modest positive working capital (£1,569). However, total liabilities including long-term loans of £20,000 exceed total assets, leading to negative net assets. The company holds minimal fixed assets or equity capital, indicating limited financial buffer or collateral value. This weak capital structure impacts the company’s resilience to adverse economic conditions.

3. Cash Flow Assessment: Limited but Stable Liquidity
   Cash holdings of £11,577 and debtors of £9,992 provide some short-term liquidity. However, the company has no reported turnover or employees, implying limited operating cash inflows. The current liabilities of £20,000 due within one year must be managed carefully to avoid liquidity strain. The presence of an equal amount of long-term liabilities indicates that the company is dependent on loan funding with scheduled repayments. Without demonstrated revenue or cash flow generation, the ability to service debt relies heavily on external funding or capital injections.

4. Monitoring Points:

• Monitor future filings for revenue generation and profitability improvements.
• Track changes in net assets and working capital to assess financial trajectory.
• Review cash flow statements when available to verify operating cash inflows versus financing needs.
• Keep watch on loan repayment schedules and any restructuring or refinancing activities.
• Monitor director and shareholder activity for potential capital injections or guarantees.