Company Number: 13612168

Analysis Date: 2025-07-29 17:29 UTC

1. Risk Rating: HIGH

The company exhibits significant financial distress as evidenced by large net current liabilities and negative net assets exceeding £1.1 million. The continuing substantial indebtedness to group undertakings and impairment of investments indicate solvency risk. While the directors assert going concern status supported by group backing and long-term contracts, the financial metrics themselves reflect high risk.

2. Key Concerns:

• Persistent and large net current liabilities (£1.2 million) and negative net assets, indicating the company is insolvent on a balance sheet basis.
• Significant impairment of investments in subsidiaries (£1.13 million), suggesting underlying operational or financial difficulties within group entities.
• Heavy reliance on debt owed to group undertakings; £1.2 million owed with no indication of repayment ability outside intra-group support raises liquidity and solvency red flags.

3. Positive Indicators:

• Up to date filing status for both accounts and confirmation statements, indicating compliance with regulatory requirements.
• The company benefits from group support, specifically from Tosca Debt Capital LLP, which has committed to continued financial backing for at least 12 months.
• The company has stable governance with recent director appointments and an unqualified auditor’s report, suggesting no immediate governance or audit issues.

4. Due Diligence Notes:

• Investigate the nature and terms of debt owed to group undertakings, including repayment schedules and any financial support agreements.
• Review the operational performance and financial health of subsidiary Sixth Sense Trading Limited to assess the cause and recoverability of impairment.
• Confirm the robustness of group support arrangements and Tosca Debt Capital LLP’s commitment beyond the 12-month horizon.
• Assess cash flow forecasts and working capital management to determine liquidity sufficiency.
• Evaluate any contingent liabilities or off-balance sheet risks not disclosed in the accounts.