MASTERGRID LIMITED

Executive Summary

Mastergrid Limited is a small, recently incorporated company showing improving financial metrics but remains dependent on its parent company for financial support. While regulatory compliance and audit opinions are positive, the high intercompany liabilities and limited operational history present a moderate risk profile. Further due diligence on intercompany arrangements and operational cash flows is recommended to fully assess financial stability and sustainability.

MASTERGRID LIMITED - Analysis Report

Company Number: 13879553

Analysis Date: 2025-07-19 11:51 UTC

1. Risk Rating: MEDIUM
   Justification: Mastergrid Limited shows positive net current assets and increased shareholders' funds in 2024, indicating some financial improvement. However, its reliance on a parent company for financial support and a high level of amounts owed to group undertakings raise concerns about solvency and operational independence. The company is relatively new and small in scale, limiting historical financial data for a robust stability assessment.

2. Key Concerns:

• Dependence on Parent Company Support: The going concern statement explicitly notes reliance on the parent company (Ircamex SAS) for at least 12 months and foreseeable future, indicating potential vulnerability if this support ceases.
• High Group Company Creditors: Amounts owed to group undertakings have nearly doubled from £221k to £409k in one year, representing a substantial portion of current liabilities (£531k), suggesting liquidity pressure and possible funding through intercompany loans rather than operational cash flow.
• Limited Operational Track Record and Scale: Incorporated in 2022 with a small employee base (2 employees), the company’s limited operational history and small scale restrict assessment of sustainability and resilience under stress.

3. Positive Indicators:

• Improved Financial Position: Net current assets increased from £8.4k in 2023 to £48.2k in 2024, and retained earnings turned positive (£38.2k) after a prior deficit, indicating progress towards profitability and better working capital management.
• Compliance and Timely Filings: No overdue accounts or confirmation statements, with filings up to date, reflecting good regulatory compliance and governance practices.
• Unqualified Auditor's Report: The latest accounts have an unqualified audit opinion, supporting the reliability of the reported financial information.

4. Due Diligence Notes:

• Verify the nature and terms of intercompany balances with the parent and group companies, including repayment schedules and interest charges, to understand liquidity and solvency implications.
• Review cash flow statements and operational revenues (not filed here but may be requested) to assess true operational cash generation capacity beyond balance sheet snapshots.
• Investigate any contingent liabilities or off-balance sheet arrangements that may impact financial stability.
• Confirm the ongoing commitment and financial strength of the parent company, Ircamex SAS, given the dependence declared in going concern notes.
• Assess the business model and market positioning in its SIC category (other business support services) to evaluate sustainability and growth prospects.