NITU COURIER LTD

Executive Summary

NITU COURIER LTD remains in a fragile financial position with negative equity and working capital deficits despite slight improvements. Cash flow is constrained and reliant on director loans and debtor collections, limiting its ability to service new credit facilities. Given these factors, credit approval is not recommended without substantial financial restructuring or guarantees.

NITU COURIER LTD - Analysis Report

Company Number: 13481881

Analysis Date: 2025-07-29 19:39 UTC

1. Credit Opinion: DECLINE
   NITU COURIER LTD presents significant credit risk. Despite being active and compliant with filings, the company’s financial position is weak and deteriorating. Net liabilities stand at £727 as of June 2024, an improvement from prior years but still negative, indicating insolvency on a balance sheet basis. Negative net current assets and shareholders' funds reflect poor working capital management and erosion of equity. The company’s reliance on director loans and absence of external funding further weaken creditworthiness. The limited scale (single employee, low asset base) and negative equity suggest limited capacity to service new debt or absorb shocks.

2. Financial Strength:
   The company’s balance sheet shows a small asset base mainly composed of cash (£5,358) and trade debtors (£3,890), offset by current liabilities of £9,975. Net current liabilities of £727 indicate insufficient short-term assets to cover liabilities, raising liquidity concerns. Shareholders’ funds remain negative at £727 but improved from £2,396 negative in prior years, showing slight but insufficient recovery. The absence of fixed assets and reliance on current assets limits collateral availability. Overall, the financial structure is weak, with persistent losses eroding equity.

3. Cash Flow Assessment:
   Cash at bank increased from £2,275 to £5,358, demonstrating some improvement in liquidity. However, current liabilities have also increased, largely driven by VAT and director loans. The company’s working capital remains negative, indicating potential cash flow strain. With only one employee and minimal turnover information available, the cash generation capacity appears limited and heavily dependent on timely collection of debtors and continued director support.

4. Monitoring Points:

• Track net current assets and net liabilities quarterly to assess continued improvement or deterioration.
• Monitor director loan balances and repayment terms for signs of financial pressure or increased reliance on insider funding.
• Review VAT and tax liabilities carefully as large creditor balances in these categories may prompt HMRC scrutiny.
• Assess turnover and debtor aging to evaluate cash flow sustainability.
• Watch for any change in company status or director conduct records that could affect operational viability.