Company Number: 13130261

Analysis Date: 2025-07-20 12:05 UTC

1. Risk Rating: HIGH
   The company exhibits significant liquidity risk and solvency concerns due to large current liabilities far exceeding current assets, resulting in substantial negative net working capital.

2. Key Concerns:

• Severe Liquidity Shortfall: Current liabilities (~£449,500) substantially exceed current assets (~£38,600), yielding net current liabilities of approximately £410,900 as of June 2024. This negative working capital indicates potential difficulty meeting short-term obligations.
• Reliance on Related Party Creditors: The majority of the current liabilities appear to be amounts owed to related party Marfam Holdings Ltd (£447,000), indicating the company depends heavily on intra-group funding rather than independent operational cash flow or external financing.
• Lack of Operational Activity and Employees: No employees reported and no income statement provided (small companies exemption), suggesting minimal or no trading activity, which raises concerns about the sustainability of the business model and ability to generate ongoing revenue.

3. Positive Indicators:

• Stable Investment Property Asset: The company holds investment property valued at £466,449 at fair value, which provides a tangible asset base exceeding total liabilities net of current liabilities.
• No Overdue Filings: Both accounts and confirmation statement filings are up to date, indicating compliance with statutory requirements and no immediate governance red flags.
• Solid Shareholders’ Funds Growth: Shareholders’ funds increased from £33,228 (2023) to £55,546 (2024), reflecting some retained earnings or revaluation reserves that may support solvency in the longer term.

4. Due Diligence Notes:

• Investigate the nature of the related party creditor balance with Marfam Holdings Ltd, including terms and repayment plans, to assess the risk of these liabilities becoming due unexpectedly.
• Review cash flow projections and operating model to understand if the company can generate sufficient cash to cover current liabilities without ongoing related party support.
• Clarify the company’s business operations and revenue streams given no employees and exemption from delivering an income statement. Confirm whether the company is actively trading or simply holding investment property.
• Assess potential contingent liabilities or off-balance-sheet commitments that may exacerbate liquidity risk.
• Confirm the valuation basis and marketability of the investment property asset to ascertain its realizable value in a stressed scenario.