MESH 2023 LIMITED

Executive Summary

Mesh 2023 Limited has a strong net asset base underpinned by a significant investment in subsidiaries funded mainly through equity. However, the company currently exhibits a working capital deficit and minimal liquid assets, raising concerns about short-term liquidity and cash flow management. Conditional credit approval is recommended, contingent on improved liquidity and demonstrated ability to meet short-term obligations as trading develops.

MESH 2023 LIMITED - Analysis Report

Company Number: 14718621

Analysis Date: 2025-07-29 20:23 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Mesh 2023 Limited is a newly incorporated private limited company with limited operating history (since March 2023). The balance sheet shows substantial fixed asset investment (£5 million in group undertakings) funded largely by share premium and long-term creditors (£504k). Current liabilities exceed current assets, resulting in a working capital deficit of approximately £94.5k, which poses some liquidity risk. However, strong net assets (£4.4 million) and equity backing indicate underlying financial strength. Approval is recommended with conditions that ongoing liquidity and cash flow positions are closely monitored and that the company demonstrates ability to service short-term obligations as trading progresses.

2. Financial Strength:
   The company’s financial position is dominated by a large fixed asset investment in subsidiary shares (£5 million). This is backed by shareholder funds of £4.4 million and creditors due after more than one year of £504k, indicating a leveraged but equity-supported capital structure. The net asset value is strong, but the company has a small share capital (£1k) and substantial share premium (£3.999 million), reflecting capital injection rather than operational earnings. The negative net current assets highlight a short-term liquidity weakness, with current liabilities of £94.7k outstripping current assets of £200. This imbalance needs addressing to avoid cash flow constraints.

3. Cash Flow Assessment:
   The company’s liquidity is strained given the working capital deficit (£94.5k). Debtors are minimal (£200), and there is no indication of cash or cash equivalents on the balance sheet. Current liabilities are nearly £95k, suggesting imminent cash outflows that must be met. Without operational cash inflows or readily available liquid assets, the company may face short-term cash flow difficulties. It is critical to understand the timing and nature of creditor payments and any committed funding or cash reserves to ensure obligations can be met.

4. Monitoring Points:

• Working capital and current ratio to ensure improvement in short-term liquidity.
• Cash flow statements or forecasts demonstrating ability to meet current liabilities.
• Performance and valuation of the £5 million investment in group undertakings, as this is the key asset.
• Any additional capital injections or debt funding that impact financial flexibility.
• Directors’ management of cash resources and creditor relationships given the negative net current assets.
• Trading performance and revenue generation to support operational sustainability.