Company Number: 13035813

Analysis Date: 2025-07-20 12:54 UTC

1. Risk Rating: MEDIUM
   M3 Trades Ltd shows signs of recovery from previous years of negative net assets, reporting positive net assets and net current assets in the most recent year. However, the company remains small with limited equity and minimal share capital, which constrains its financial resilience. The micro-entity status and limited disclosures restrict a full assessment of profitability and cash flows.

2. Key Concerns:

• Historical negative net assets in 2022 and 2023 with a significant turnaround in 2024 that merits verification; fluctuations may indicate operational or financial instability.
• Low fixed asset base (£517) and modest working capital (£7,678), which could limit operational flexibility and ability to absorb shocks.
• Small equity base (£2,091) and minimal share capital (£4) suggest limited capital buffer and potential difficulties in raising further funds if required.

3. Positive Indicators:

• Current year (2024) financials show a positive net asset position and net current assets, indicating improved solvency and liquidity compared to prior years.
• No overdue filings or reported compliance issues, demonstrating good regulatory standing and governance practices.
• Consistent director involvement with no evidence of disqualifications or governance concerns; directors have relevant trade occupations aligned with the company’s SIC classification (plumbing and related trades).

4. Due Diligence Notes:

• Review the full profit and loss accounts and cash flow statements (not filed due to micro-entity exemptions) to assess ongoing profitability and cash generation capabilities.
• Investigate the nature of the significant turnaround from negative net assets in 2023 to positive in 2024, including any capital injections, debt restructuring, or asset disposals.
• Confirm ongoing trading activity, contract pipeline, and sustainability of revenue streams given the small employee base (average 2 persons) and limited fixed assets.