Company Number: 12777668

Analysis Date: 2025-07-20 19:14 UTC

1. Credit Opinion: DECLINE
   FN Traders Limited demonstrates weak financial health with persistent net current liabilities and negative shareholders' funds over recent years. The company’s net assets deteriorated from £2,004 positive in 2020 to a negative £553 in 2024. Current liabilities exceed current assets by £7,277 as of the latest accounts, indicating insufficient short-term liquidity to meet obligations. The company also relies on director loans (£3,201 in 2024) which may indicate cash flow strain. The absence of a profit and loss statement filing and the unaudited accounts limit transparency, increasing credit risk. Given these factors, the company does not currently present a reliable capacity to service new or existing debt facilities.

2. Financial Strength:
   The balance sheet shows declining net assets and negative working capital throughout the last three years. Tangible fixed assets have decreased slightly due to depreciation but remain modest (£6,724). The negative shareholders’ funds reflect accumulated losses (£653 deficit in retained earnings) eroding equity base. Reliance on director loans (~£3,200) and other creditors (~£3,250) points to external funding dependence. Overall, the balance sheet is fragile with limited buffer against financial stress.

3. Cash Flow Assessment:
   Cash balances are very low (£1,125 at year end 2024), insufficient to cover even one month of current liabilities (£8,402). Net current liabilities of £7,277 confirm working capital deficits, suggesting ongoing liquidity challenges. The increase in average employees from 2 to 4 indicates some business growth, but this has not translated into improved liquidity or profitability. Director loans provide temporary relief but are not sustainable as a long-term funding source. Cash flow appears constrained, risking delayed payments to suppliers and creditors.

4. Monitoring Points:

• Monitor profitability trends and filing of profit and loss accounts for clarity on earnings performance.
• Track changes in working capital and liquidity ratios, especially current ratio and quick ratio.
• Review director loan balances and terms for potential refinancing or repayment risks.
• Observe management actions to improve cash flow and reduce liabilities.
• Watch for timely submission of statutory filings to assess management diligence.