Company Number: 13952298

Analysis Date: 2025-07-20 15:07 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns, evidenced by persistent large current liabilities exceeding current assets and minimal net assets. The financial structure suggests high leverage and very limited working capital, raising substantial risk about meeting short-term obligations.

2. Key Concerns:

• Negative Net Current Assets: The company’s current liabilities (~£1.45m) far exceed its current assets (~£12k), resulting in negative net working capital (-£10k), which indicates potential liquidity stress.
• High Long-Term Borrowings: Creditors falling due after more than one year total approximately £1.45m, nearly matching fixed assets, implying heavy reliance on debt financing with limited equity cushion.
• Minimal Shareholders’ Funds: The net assets are only £377 as of 2024, a slight improvement from a negative position the prior year. This very thin equity base is insufficient to absorb losses or provide financial stability.

3. Positive Indicators:

• Stable Fixed Assets: Fixed assets remain consistent around £1.46m, suggesting the company holds tangible assets that could support secured borrowing or potential asset realization if necessary.
• No Overdue Filings: The company is current on statutory accounts and confirmation statements, indicating compliance with filing requirements and governance obligations.
• Single Director/Shareholder: The controlling individual is also the director and secretary, which can streamline decision-making and potentially reduce administrative costs.

4. Due Diligence Notes:

• Investigate the nature and terms of the substantial long-term creditors to assess repayment schedules, interest obligations, and creditor relationships.
• Review cash flow statements (not provided) for evidence of operational cash generation or reliance on external funding to meet obligations.
• Clarify business model and revenue streams supporting asset base and debt structure, given the micro-entity classification and low current assets.
• Confirm any contingent liabilities or off-balance sheet risks that may exacerbate solvency concerns.
• Assess director’s plans for capital injection or restructuring to improve equity and liquidity positions.