Company Number: 12418525

Analysis Date: 2025-07-20 18:55 UTC

1. Risk Rating: HIGH
   Justification: The company shows persistent and significant negative net assets and net current liabilities over multiple years, indicating severe solvency and liquidity issues. The net current liabilities worsened from -£1,349 in 2023 to -£5,430 in 2024, with net assets declining from -£1,183 to -£5,217. This pattern suggests ongoing financial distress and inability to meet short-term obligations without external support.

2. Key Concerns:

• Severe Negative Net Assets: The company’s shareholders’ funds are substantially negative and deteriorating, reflecting accumulated losses and potential insolvency risk.
• Liquidity Mismatch: Current liabilities far exceed current assets, with working capital deficits worsening sharply in the latest year, raising concerns over operational cash flow and ability to pay creditors.
• Lack of Audit and Limited Financial Disclosure: Being a micro-entity exempt from audit and not filing a profit and loss account limits transparency, complicating a full assessment of operational performance and cash flow generation.

3. Positive Indicators:

• Timely Filing Compliance: No overdue accounts or confirmation statements indicate adherence to regulatory filing requirements, reflecting some governance discipline.
• Stable Management: The sole director and person of significant control has been consistent since incorporation, potentially providing stable leadership.
• Micro-Entity Category: The small scale of operations might imply lower complexity and cost base, which could be leveraged for turnaround if addressed promptly.

4. Due Diligence Notes:

• Investigate the underlying causes of the worsening net current liabilities and negative equity, including revenue trends, expense structure, and creditor relationships.
• Review cash flow statements and bank facilities (not filed here) to assess liquidity management and reliance on external financing or director loans.
• Examine any contingent liabilities or off-balance-sheet obligations that might exacerbate solvency risks.
• Assess the business model’s viability in the public houses and bars sector, especially considering the impact of economic conditions or regulatory changes.
• Clarify the role and commitment of the sole director in funding or restructuring the business.