MEGA DESIGN AND BUILD LTD

Executive Summary

MEGA DESIGN AND BUILD LTD exhibits significant liquidity and solvency risks as evidenced by consecutive years of negative net current assets and a low, declining equity base. While current regulatory compliance and stable management are positive factors, the company’s financial position raises concerns about its ability to meet short-term obligations and sustain operations without additional capital support. Further due diligence into liabilities, cash flow, and operational viability is recommended before investment consideration.

MEGA DESIGN AND BUILD LTD - Analysis Report

Company Number: 13887924

Analysis Date: 2025-07-20 14:28 UTC

1. Risk Rating: HIGH

Justification: The company shows persistent negative net current assets over the last two years, indicating current liabilities exceed current assets by a significant margin (£6,470 in 2024 and £7,859 in 2023). Net assets and shareholder funds are very low and declining (£320 in 2024 from £629 in 2023), signaling weak equity and solvency risk. The company has minimal cash balances relative to current liabilities, raising liquidity concerns.

2. Key Concerns:

• Negative net working capital in consecutive years suggests ongoing liquidity pressures, potentially impacting the company’s ability to meet short-term obligations.
• Very low net asset base with erosion over time indicates limited financial buffer and solvency risk.
• Minimal scale of operations as reflected by one employee and low tangible fixed assets, which may challenge operational stability and growth prospects.

3. Positive Indicators:

• The company is compliant with filing deadlines (accounts and confirmation statements up to date), indicating good regulatory compliance.
• Directors are stable and have been in place since incorporation, which may suggest consistent management.
• The business operates in building completion and development sectors, which can have steady demand if managed effectively.

4. Due Diligence Notes:

• Investigate the nature and terms of current liabilities to understand if any are overdue or at risk of immediate repayment demands.
• Review contract pipeline and revenue recognition policies, given the construction industry SIC codes and the potential for project-based cash flow variability.
• Assess the company’s access to external financing or shareholder support to address working capital deficits.
• Confirm the absence of any director disqualifications or governance issues beyond available data.
• Explore detailed profit and loss performance as it has not been filed publicly to gauge operational profitability and trends.