MEDINI LTD

Executive Summary

Medini Ltd exhibits a significantly weakened financial position with minimal net assets and high current liabilities relative to current assets. The company’s reliance on director loans and lack of employees suggest limited operational capacity to generate stable cash flows, leading to an elevated credit risk. Credit facilities are not recommended at this stage without substantial improvement in financial metrics and operational evidence.

MEDINI LTD - Analysis Report

Company Number: 14265741

Analysis Date: 2025-07-29 13:56 UTC

1. Credit Opinion: DECLINE
   Medini Ltd’s financial position raises concerns for credit extension. The company shows a steep decline in net assets from £21,645 in 2023 to just £1,518 in 2024, primarily driven by a significant increase in current liabilities (£61,699 vs. £36,117) while current assets have only marginally improved. This erosion of equity indicates financial stress and weak capital buffer, heightening risk of default. Additionally, the company has no employees and relies heavily on director advances (£52,782 owed by director), suggesting limited operational scale and potential dependency on insider funding rather than sustainable business cash flows.

2. Financial Strength:
   The balance sheet is fragile. Net current assets are positive but minimal (£1,518), reflecting very tight working capital. There is no long-term asset base, and shareholders’ funds have nearly been depleted, indicating weak financial resilience. The company’s micro-entity status with low turnover thresholds and no audit reduces transparency on underlying business performance. The absence of employees and reliance on director loans further undermine the financial strength profile.

3. Cash Flow Assessment:
   Liquidity appears constrained. Current assets barely cover current liabilities, leaving a negligible buffer to absorb cash flow fluctuations. The director’s loan account suggests external cash injections are supporting operations, rather than internally generated funds. Without clear evidence of consistent revenue or operating cash flow, the company’s ability to meet debt obligations from trading cash flows is questionable.

4. Monitoring Points:

• Track changes in net current assets and net liabilities to detect further erosion of liquidity.
• Monitor director loan account for any repayments or increases.
• Review operational developments including revenue generation and employee additions.
• Observe filing of next accounts and confirmation statement for timely compliance and any notable changes in company structure or financials.