MLB20 LTD

Executive Summary

MLB20 Ltd demonstrates high liquidity and solvency risk, driven by ongoing negative working capital and high leverage relative to minimal net assets. While regulatory compliance is current and the investment property asset base has grown, absence of profitability data and persistent creditor exposure raise concerns about operational sustainability. Further detailed financial and operational due diligence is recommended to clarify cash flow dynamics and asset realizability.

MLB20 LTD - Analysis Report

Company Number: NI678114

Analysis Date: 2025-07-29 18:02 UTC

1. Risk Rating: HIGH
   The company exhibits significant liquidity risk, evidenced by persistent negative net current assets and current liabilities substantially exceeding current assets, indicating potential difficulties in meeting short-term obligations. Additionally, net assets are minimal relative to total liabilities, suggesting weak solvency.

2. Key Concerns:

• Persistent Negative Working Capital: Net current assets have been negative for several years, worsening to -£64,517 as of April 2024, showing ongoing liquidity strain.
• High Leverage: Bank loans and other creditors exceed £160,000 in total against net assets below £1,000, indicating high financial leverage and vulnerability to creditor pressure.
• Lack of Profit and Cash Generation Data: Absence of income statement and profit/loss figures limits visibility on operational cash flows and profitability, raising uncertainty about sustainability.

3. Positive Indicators:

• Ownership and Control: The two directors, who are also significant shareholders, appear actively involved and have professional backgrounds (one solicitor), suggesting committed management.
• Investment Property Asset Growth: Investment property increased substantially from £80,156 to £130,550 in the latest year, indicating asset base growth through acquisitions or valuations.
• Compliance Status: Company filings including accounts and confirmation statements are up to date with no overdue submissions, reflecting regulatory compliance.

4. Due Diligence Notes:

• Investigate Cash Flow and Profitability: Obtain or review the company’s profit and loss accounts or management accounts to assess operational performance and cash generation.
• Assess Debt Terms and Covenants: Clarify bank loan arrangements to understand repayment schedules, covenants, and any potential breach risks.
• Confirm Valuation of Investment Property: Verify the valuation methodology and market conditions affecting the investment property to ensure asset values are realistic and realizable.
• Review Related Party Transactions: Given common addresses and shareholding, assess any related party dealings for potential conflicts or financial support mechanisms.