NEW GOLDEN GATE LTD

Executive Summary

NEW GOLDEN GATE LTD exhibits significant financial stress with negative net assets and worsening liquidity metrics, posing a high solvency risk. Although compliance and ownership structure are sound, the company’s limited scale and negative equity position raise serious concerns about operational sustainability. Further due diligence on cash flow, management plans, and trading performance is essential before considering investment.

NEW GOLDEN GATE LTD - Analysis Report

Company Number: 13989965

Analysis Date: 2025-07-20 11:26 UTC

1. Risk Rating: HIGH
   The company’s financial data reveals significant net current liabilities and negative net assets, indicating solvency challenges. Although it is a micro-entity with limited operational scale, the worsening working capital position from 2023 to 2024 is a red flag. The business operates in a competitive, low-margin sector (take-away food) with very limited fixed assets and small employee base, raising concerns about operational sustainability.

2. Key Concerns:

• Solvency and Liquidity: The balance sheet shows net current liabilities of £10,630 and net assets of negative £7,740 as of 31 March 2024, worsening from the previous year, indicating an inability to cover short-term obligations with current assets.
• Negative Equity Position: Shareholders’ funds are negative, reflecting accumulated losses or withdrawals, which undermines financial stability and the ability to attract further investment or credit.
• Limited Operational Scale and Asset Base: With only 2 employees and low fixed assets (£2,890), the company’s capacity to generate sufficient cash flow or absorb shocks is limited. This creates risk around ongoing operational viability.

3. Positive Indicators:

• Timely Filings and Compliance: Accounts and confirmation statements are filed on time, indicating adherence to statutory requirements and good governance on compliance front.
• Clear Ownership and Control: One individual (Ms Xiao Yun Guo) holds 75-100% ownership and voting rights, which can facilitate swift decision-making and strategic control.
• Consistent Employee Base: The company maintains a steady small workforce, suggesting some operational continuity.

4. Due Diligence Notes:

• Investigate Cash Flow and Funding Sources: Review management accounts or cash flow statements to assess if the company is able to generate positive cash flow or if there are ongoing injections of capital from shareholders or related parties.
• Examine Directors’ Plans and Strategy: Obtain information on how the directors plan to address the negative equity and liquidity issues—whether through restructuring, additional capital infusion, or operational changes.
• Review Detailed Trading Performance: Analyze turnover, margins, and profitability beyond the micro-entity accounts to understand operational sustainability in the take-away food sector.
• Confirm No Undisclosed Liabilities or Contingencies: Verify if there are any off-balance-sheet liabilities, legal claims, or tax issues that could exacerbate financial risk.
• Director Background Checks: While no disqualifications are indicated, further background checks on the directors may be prudent given the financial distress signals.