Company Number: 13884212

Analysis Date: 2025-07-29 20:34 UTC

1. Credit Opinion: CONDITIONAL APPROVAL. Moreia Limited is a recently incorporated (2022) private limited company operating in the construction sector (domestic building and project development). The company shows significant growth in current assets (mainly stock/work-in-progress) from £6,840 in 2023 to £603,949 in 2024, indicating active trading and business scaling. However, the company remains in a net liabilities position (£-4,144) due to long-term creditors (£298,820) and secured loans (£570,945) secured against land assets. The directors have provided support and the company is forecasted to continue as a going concern. Approval is recommended subject to ongoing monitoring of liquidity and debt servicing capability, especially given the high secured debt and negative equity.

2. Financial Strength: The balance sheet shows a sizeable increase in stock/work in progress (£601,122) as the main current asset, reflecting construction activity. Debtors are negligible (£8), and cash on hand is low (£2,819), which suggests limited cash liquidity. Current liabilities have increased substantially to £309,273, with trade creditors being a small portion (£887) and the majority owed to related parties and other creditors. Non-current liabilities of £298,820 and secured loans of £570,945 indicate significant gearing, although the secured debt is backed by land holdings. Negative net assets and shareholders’ funds (£-4,146) reflect accumulated losses or investment in growth. Overall financial strength is weak but mitigated by asset backing and director support.

3. Cash Flow Assessment: Current assets cover current liabilities by approximately 1.95 times (£603,949 / £309,273), indicating sufficient short-term working capital. However, cash balances are very low, suggesting potential cash flow constraints for day-to-day operations. The company relies heavily on stock/work-in-progress, which can limit cash conversion speed. The business is supported by director loans and related party funding, which currently alleviates liquidity risk but may pose future refinancing risks. Monitoring cash flow forecasts and debtor collection will be critical to ensure liquidity sufficiency.

4. Monitoring Points:

• Track cash flow closely, focusing on conversion of stock/work-in-progress to cash.
• Monitor debt servicing on secured loans and long-term creditors.
• Review periodic updates on director/related party funding commitments.
• Watch for improvements in net asset position and profitability.
• Confirm timely filing of accounts and adherence to credit terms with suppliers.