Company Number: 13630889

Analysis Date: 2025-07-29 13:42 UTC

1. Credit Opinion: APPROVE with conditions. NBC (LANCS) LTD is a small private limited company operating in the sale of motor vehicles. The company shows modest but positive net assets and working capital, indicating a capacity to meet short-term obligations. However, there has been a decline in current assets and cash balances over the last year, and current liabilities remain significant. Given the company’s size, limited staff (2 employees), and relatively recent incorporation (2021), caution is warranted. Approval is recommended with ongoing monitoring of liquidity and cash flow to ensure stability and timely repayments.

2. Financial Strength: The company’s net assets increased from £12,313 in 2023 to £18,518 in 2024, reflecting retained earnings growth and improved equity base. Total assets less current liabilities improved from £12,813 to £19,018, indicating better coverage of short-term debts by assets. However, current assets dropped from £115,928 to £85,463 largely due to a reduction in stock and cash reserves. The balance sheet shows no indication of long-term debt, which reduces leverage risk. Overall, the capital structure is stable but lean, typical of a small enterprise.

3. Cash Flow Assessment: Cash at bank and in hand decreased from £24,357 to £17,973, suggesting tighter liquidity during the latest period. Current liabilities also reduced from £105,999 to £66,445, improving the net working capital position from negative to positive. Stock levels fell substantially, which may indicate better inventory management or reduced sales volume. The company’s net current assets position at £19,018 is positive but small, implying limited buffer against unexpected cash flow shocks. The low employee count and small operating scale suggest manageable overheads, but liquidity should be watched closely.

4. Monitoring Points:

• Cash balances and liquidity trends: continued monitoring to ensure sufficient cash flow for debt service.
• Current liabilities relative to current assets: watch for any signs of increasing short-term borrowings or payables pressure.
• Inventory levels and turnover: ensure stock is not becoming obsolete or tying up excessive funds.
• Profitability and retained earnings growth: absence of P&L details limits assessment; future filings should be reviewed for earnings trends.
• Director and ownership changes or material operational shifts that could affect credit risk.