MOSAIC DEVELOPMENTS LTD

Executive Summary

Mosaic Developments Ltd is financially distressed with negative net assets and poor liquidity, primarily due to high leverage against limited assets. The company’s ability to generate cash flows and service debt is highly uncertain given the minimal operational data and working capital deficit. Credit facilities are not recommended without substantial evidence of improved financial health or restructuring.

MOSAIC DEVELOPMENTS LTD - Analysis Report

Company Number: 14156980

Analysis Date: 2025-07-29 16:43 UTC

1. Credit Opinion: DECLINE
   Mosaic Developments Ltd demonstrates significant financial weaknesses for credit extension. The company, incorporated in 2022, has a negative net asset position (£-17,052) as of June 2024, indicating insolvency on a balance sheet basis. It holds substantial long-term liabilities (£177,449) compared to fixed assets (£165,361) and negligible current assets (£6). The working capital deficit (£-4,964) and lack of cash reserves undermine the company’s ability to meet short-term obligations. The absence of turnover and employee data suggests limited operational activity or revenue generation, raising concerns about its capacity to service debt or sustain commercial commitments. Given these factors, the company poses a high credit risk.

2. Financial Strength:
   The balance sheet reveals a distressed financial position. Fixed assets are mainly investment property valued at £165k, while current assets are almost nil. Current liabilities exceed current assets, resulting in negative net current assets. Long-term creditors significantly outweigh total assets less current liabilities, pushing net assets into negative territory. Shareholders' funds are also negative, reflecting accumulated losses and potential undercapitalization. There is no indication of profitability or equity injections to support the business. The financial structure is fragile, with leverage heavily skewed toward external debt.

3. Cash Flow Assessment:
   Liquidity is critically constrained. Cash holdings are minimal (£6), insufficient to cover immediate liabilities (£4,970 due within one year). The net current asset deficit signals ongoing liquidity pressure. No evidence of cash inflows or operational cash generation is apparent from the accounts or disclosures. Reliance on director loans and other loans suggests external financing support, but these are already substantial. The lack of working capital buffers and cash reserves points to vulnerability in meeting short-term payment commitments without additional financing or asset disposals.

4. Monitoring Points:

• Monitor changes in net asset value and working capital position in future filings.
• Watch for evidence of revenue generation, cash flow improvements, or capital injections.
• Track any refinancing or restructuring of long-term debt to reduce leverage.
• Review director conduct and any changes in management strategy to assess turnaround prospects.
• Keep alert for any late filings or signs of financial distress such as administration or liquidation.