MADWAY LTD

Executive Summary

Madway Ltd exhibits a high risk profile primarily due to substantial liquidity deficits and negative net equity within its first year of operation. While the company holds a significant investment property asset and is compliant with filing obligations, urgent attention is required to address its solvency challenges. Further investigation into creditor terms and asset realizability is essential before considering investment.

MADWAY LTD - Analysis Report

Company Number: 14283526

Analysis Date: 2025-07-29 19:50 UTC

1. Risk Rating: HIGH
   The company's financials show significant net current liabilities (£-510,668) and negative net assets (£-20,668), indicating solvency and liquidity issues. The current liabilities vastly exceed current assets, which is a major red flag for meeting short-term obligations.

2. Key Concerns:

   • Severe Liquidity Shortfall: Current liabilities of £518,900 dwarf current assets of only £8,232, suggesting immediate cash flow problems.
   • Negative Net Assets and Shareholders’ Funds: With net assets and shareholders’ funds both negative, the company is technically insolvent on a balance sheet basis.
   • No Employees and Limited Operational History: Incorporated in August 2022 with no employees and minimal operational data raises concerns about the sustainability and scale of business operations.

3. Positive Indicators:

   • Investment Property Asset of £490,000: The company holds a sizeable investment property valued at £490,000, which could potentially be leveraged or sold to improve liquidity.
   • Timely Filing and Compliance: No overdue accounts or confirmation statements, indicating good compliance with statutory requirements.
   • Industry Focus on Real Estate Management: Established SIC codes show clear business classification in real estate management, a sector that can generate fee income.

4. Due Diligence Notes:

   • Investigate the nature and terms of the £518,900 creditors due within one year to understand the liquidity crunch (e.g., are these loans, trade payables, or accrued expenses?).
   • Verify the valuation and marketability of the investment property to assess its realistic cash conversion potential.
   • Review cash flow projections and funding plans from directors to determine how the company intends to resolve its negative working capital and improve solvency.
   • Confirm whether there are any contingent liabilities or off-balance sheet obligations not disclosed.
   • Check for any director or shareholder loans and related party transactions that may affect financial stability.