LINEWAY UK TRADING LTD

Executive Summary

Lineway UK Trading Ltd demonstrates ongoing financial challenges characterized by negative net assets and working capital deficits, albeit with recent signs of improvement. While regulatory compliance is maintained with current filings, the company’s solvency and liquidity risks remain elevated, warranting thorough review of creditor arrangements and operational cash flows. Investors should approach with caution and seek further detailed financial disclosures before commitment.

LINEWAY UK TRADING LTD - Analysis Report

Company Number: 13586954

Analysis Date: 2025-07-29 18:35 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency risk due to persistent negative net assets and current liabilities exceeding current assets, indicating potential challenges in meeting short-term obligations.

2. Key Concerns:

• Negative Net Assets: The company’s net assets remain negative (£-27,725 in 2024), though improved from prior years, indicating accumulated losses and potential insolvency risk.
• Working Capital Deficit: Current liabilities (£71,435) exceed current assets (£69,083), resulting in negative net current assets (£-2,352), a liquidity concern.
• Long-Term Creditors: The presence of creditors falling due after more than one year (£31,240) adds to the company’s financial obligations without clear evidence of sufficient asset coverage.

3. Positive Indicators:

• Improvement Trend: The net liabilities have reduced substantially from £-67,134 in 2023 to £-27,725 in 2024, showing progress in financial position.
• Increased Current Assets: A notable increase in current assets from £10,557 in 2023 to £69,083 in 2024 suggests improved asset liquidity or working capital management.
• Active Trading Status with No Overdue Filings: The company is active, with up-to-date accounts and confirmation statements, reflecting compliance with regulatory requirements.

4. Due Diligence Notes:

• Investigate the nature and terms of long-term creditors (£31,240) to assess repayment obligations and potential refinancing risks.
• Review cash flow statements and turnover data (not provided) to evaluate operational cash flows and sustainability of the business model.
• Confirm whether there are any contingent liabilities or off-balance sheet commitments that could exacerbate solvency risk.
• Consider the director’s plans or capital injection intentions to address the historical losses and improve equity position.
• Assess the reliability of financial data given micro-entity accounting standards and absence of audit.