Company Number: 13951965

Analysis Date: 2025-07-29 15:14 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   NETWORK N MEDIA LIMITED is a recently incorporated private limited company operating in IT and publishing services. The company shows positive net current assets and net assets, indicating a stable balance sheet. However, the company is still in early growth stages (incorporated 2022) with limited fixed asset investment and a small equity base (£100 share capital). The significant increase in current liabilities over the last year alongside increasing debtors suggests some working capital pressure. Approval is recommended subject to monitoring debtor collections and covenant compliance to ensure liquidity remains sufficient for debt servicing.

2. Financial Strength:

• Net assets at 31 March 2024 stand at £534,529, slightly down from £551,951 the previous year, reflecting amortisation charges on intangible assets.
• Total current assets of £1.09M are comfortably above current liabilities of £587k, providing a net current asset (working capital) buffer of £503k. This is a solid liquidity position.
• Intangible assets (goodwill) have decreased from £37.6k to £10.3k due to amortisation, indicating no recent significant acquisitions.
• Tangible fixed assets are modest (£21.5k), consistent with a service business model.
• Shareholder funds consist largely of retained earnings (£534k), demonstrating accumulated profits or capital injections.
  Overall, the balance sheet appears healthy for the company’s size and age, with no significant leverage or solvency concerns.

3. Cash Flow Assessment:

• Cash holdings increased from £354.8k to £375.4k, showing positive liquidity management.
• Debtors increased notably to £714k from £613k, with a large portion (£518k) owed by associated companies. This could pose a risk if collection is delayed or disputes arise.
• Current liabilities rose from £469k to £587k, indicating increased short-term obligations.
• Net current assets remain stable around £500k, supporting operational liquidity.
• The company’s ability to convert debtors to cash timely is critical to maintain cash flow adequacy for meeting payables and any financing costs.
• No audit was performed, so underlying cash flow details are limited; however, current ratios and cash balances are supportive.

4. Monitoring Points:

• Debtor collection days and aging profile, especially amounts due from associated companies.
• Trends in current liabilities and any new short-term debt or payables growth.
• Profitability and cash generation in subsequent periods to ensure working capital is maintained.
• Management of intangible assets amortisation and any impact on reserves.
• Confirmation of continued operational performance given the company's young age and sector risks.
• Director and shareholder changes or related party transactions given the substantial control by Network N Limited.