MIKDEL LTD

Executive Summary

MIKDEL LTD shows asset backing from property but has weak liquidity and negative working capital, supported largely by director loans. Credit approval is conditional pending improved cash flow and debt servicing evidence. Close monitoring of liquidity and creditor repayments is recommended to mitigate risk.

MIKDEL LTD - Analysis Report

Company Number: 13828320

Analysis Date: 2025-07-29 18:36 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   MIKDEL LTD is a recently incorporated micro-entity operating in real estate management and letting. The company shows modest net asset value (£16k) and a stable fixed asset base (£298k) derived likely from property holdings. However, it has significant net current liabilities (£83k) and considerable long-term creditors (£198k) which indicates reliance on external financing or director loans. The directors have extended interest-free loans (£75k) to support liquidity, showing commitment but also an indication of cash flow constraints. Given the company’s early stage, limited trading history, and weak working capital position, credit approval should be conditional on close monitoring of cash flows and debt servicing ability.

2. Financial Strength:

• Fixed assets have nearly doubled in a year, reflecting investment or acquisition of property assets.
• Net assets have decreased from £32k to £16k, mainly due to increased liabilities.
• Current liabilities exceed current assets by £83k, indicating negative working capital and potential liquidity risk.
• The company’s balance sheet is asset-heavy but with a stretched capital structure and low equity buffer.

3. Cash Flow Assessment:

• Current liabilities of £198k (including £87k due within one year) exceed current assets of under £5k, highlighting poor short-term liquidity.
• Directors’ loans (£75k) are interest-free with no fixed repayment schedule, suggesting informal financing to cover cash shortfalls.
• The company’s ability to generate operational cash flow is uncertain given limited employee base (2) and lack of reported turnover figures.
• Dependence on director funding and related party arrangements (use of director-owned property rent-free) adds risk if personal circumstances change.

4. Monitoring Points:

• Timely repayment or refinancing of short and long-term creditors to avoid default.
• Improvement in net current assets through increased cash or receivables from operations.
• Revenue growth and profitability trends in future accounts to demonstrate operational viability.
• Director loan balances and any changes in related party transactions.
• Any delays in statutory filings or changes in company status.