MANSELL SIGNAL SIGHTING LIMITED

Executive Summary

Mansell Signal Sighting Limited demonstrates strong liquidity with ample cash reserves and positive working capital. However, increased finance lease obligations and a reduction in net assets warrant a cautious approach. Credit approval is recommended with conditions focusing on monitoring debt servicing capacity and cash flow stability.

MANSELL SIGNAL SIGHTING LIMITED - Analysis Report

Company Number: 13140048

Analysis Date: 2025-07-29 13:43 UTC

Credit Opinion:
CONDITIONAL APPROVAL. Mansell Signal Sighting Limited shows a solid liquidity position supported by strong cash balances and positive working capital. However, the company's net assets have decreased by approximately 19% year-on-year, and there is a significant finance lease obligation outstanding (£34,990), which raises some concern regarding medium-term leverage. The company is relatively new (incorporated in 2021) and operates in a niche engineering sector, which could imply revenue volatility. Credit facilities should be approved with conditions including regular monitoring of debt servicing and lease obligations, and a review of profitability and cash flow stability.

Financial Strength:
The balance sheet reflects modest fixed assets (£28,519) and robust current assets (£107,815), primarily cash, which supports liquidity. Current liabilities have more than doubled to £61,121, mainly due to increased finance lease liabilities and director loan accounts. The company has net current assets of £46,694, indicating good short-term financial health. However, net assets have declined from £56,064 in 2023 to £45,545 in 2024, reflecting either operational losses or asset write-downs. The presence of finance lease obligations after one year (£29,668) introduces medium-term financial commitments that need careful management.

Cash Flow Assessment:
Cash increased significantly from £42,400 in 2023 to £107,815 in 2024, indicating positive short-term liquidity and potentially strong cash generation or capital injection. The company has cleared director loans in the current year, which improves creditor position. The working capital position is healthy with net current assets covering current liabilities by 76%. However, the finance lease commitments totaling nearly £35k are a future cash outflow risk. The absence of trade debtors in the latest year suggests either prepayment by customers or delayed sales, which could affect sustained cash inflows. Close monitoring of cash conversion cycles is advised.

Monitoring Points:

• Track profitability and cash flow trends in subsequent accounts to confirm the company’s ability to service finance lease debt.
• Monitor the impact of finance lease liabilities on cash flow and overall gearing.
• Review director loan accounts and any related party transactions for potential cash flow impacts.
• Observe changes in trade debtor levels to assess revenue stability.
• Evaluate any changes in current liabilities, especially tax and corporation tax provisions, which are significant.
• Confirm ongoing compliance with filing deadlines and accounting standards.