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.