NINE WORLDS LIMITED

Executive Summary

NINE WORLDS LIMITED is a young property letting business with growing investment assets secured by bank loans. Despite negative net assets and working capital deficits, the company’s collateral and directors’ financial backing provide some credit support. Approval is recommended conditionally, with close monitoring of cash flow from rental income and debt servicing capability.

NINE WORLDS LIMITED - Analysis Report

Company Number: 13969971

Analysis Date: 2025-07-29 18:05 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   NINE WORLDS LIMITED is an early-stage property letting company with significant investment property assets acquired during 2023. While the company currently shows negative net assets and net current liabilities, it has secured bank loans against investment property, indicating some collateral coverage. The ability to service debt depends heavily on rental income generation and the directors' ongoing financial support, as evidenced by related party loans. The credit facility should be approved on a conditional basis, requiring periodic review of rental income cash flows and loan servicing performance.

2. Financial Strength:

• The balance sheet as of 31 December 2023 shows fixed assets (investment properties) valued at £1,016,178, a material increase from prior year (£127,321), demonstrating growth in asset base.
• However, net current liabilities are substantial at £433,733, driven by short-term creditors of £458,100 and a bank loan of £25,240 due within one year.
• Long-term liabilities include bank loans of £585,505 secured against investment property, making total borrowings approximately £610,745.
• Shareholders’ funds are negative at £3,060, though improved from prior years, reflecting accumulated losses and early-stage investment.
• The company is investing heavily in property assets, which supports collateral coverage but adds risk if rental income is insufficient.

3. Cash Flow Assessment:

• Cash on hand at year-end is £22,238, a significant increase from £1,612 in the prior year, showing some improvement in liquidity.
• Debtors are minimal (£2,129), indicating limited receivables exposure.
• The large short-term creditor balance and loan repayments due within a year present liquidity risk.
• The company’s ability to generate rental income sufficient to cover interest and principal payments is critical; currently, rental income is evidenced but not quantified in detail.
• Related party loans provide additional funding buffer but also indicate dependency on director-related support.

4. Monitoring Points:

• Monitor rental income and occupancy rates of investment property to assess ongoing cash flow generation.
• Watch liquidity ratios, especially current ratio and quick ratio, given negative net current assets.
• Track repayment status of bank loans and related party borrowings.
• Review any further capital injections or equity funding to improve net asset position.
• Assess compliance with loan covenants tied to investment property valuations and income.