Company Number: 14119864

Analysis Date: 2025-07-29 14:15 UTC

1. Credit Opinion: DECLINE
   Macbeth Pub Limited shows a weak financial position with negative net assets of £2,162 as at 31 May 2024, indicating that liabilities exceed assets. The company has consistently reported net current liabilities (negative working capital) worsening from -£61,829 to -£90,376 year-on-year. Cash reserves are low (£3,668), which raises concerns about short-term liquidity and ability to meet immediate obligations. The company is relatively new (incorporated 2022) and operates in the competitive pub industry, but the financials reflect ongoing operating losses or cash flow challenges. Given the negative equity, poor liquidity, and lack of profitability evidence, the company’s ability to service additional debt or commercial credit is questionable. Approval is not recommended unless strong additional security or guarantees are provided.

2. Financial Strength:
   The balance sheet shows tangible fixed assets of £88,214, increased from £58,618 the prior year due to capital expenditure on land, buildings, and property improvements. However, current liabilities of £115,262 substantially exceed current assets of £24,886, resulting in negative net current assets of -£90,376. This indicates significant short-term funding gaps. The company’s equity position is negative (£-2,162), reflecting accumulated losses or insufficient capital injection. The fixed asset base is tangible but not readily liquid, limiting its usefulness in covering short-term obligations. Overall, the financial strength is poor with a weak capital structure and balance sheet stress.

3. Cash Flow Assessment:
   Cash at bank has declined sharply from £13,282 to £3,668, signaling cash burn or insufficient cash inflows. Debtors have also reduced, but not sufficiently to offset liabilities. The negative working capital implies the company relies on external financing or overdue payables to fund operations. Staff costs have decreased, suggesting cost-cutting, but overall cash flow generation remains inadequate to improve liquidity. The absence of an income statement limits detailed profitability insight, but the balance sheet and cash trends point to cash flow weakness. The company likely faces challenges in meeting short-term liabilities without refinancing or capital support.

4. Monitoring Points:

• Monitor liquidity monthly, especially cash balances and creditor payment terms.
• Track any further capital injections or shareholder loans to bolster equity and working capital.
• Observe trading performance and profitability once income statements become available.
• Watch director changes and control shifts for stability in management and governance.
• Keep an eye on stock levels and debtor collections efficiency to optimize working capital.
• Review compliance with upcoming filing deadlines and any signs of financial distress.