NUTRAL SOLUTIONS LIMITED

Executive Summary

Nutral Solutions Limited currently exhibits significant financial distress with large negative working capital and net liabilities, reflecting an inability to meet short-term obligations independently. The company relies heavily on related party funding, with minimal tangible assets and weak liquidity, making credit risk high. Without demonstrable improvements in cash flow or equity, credit facilities cannot be recommended at this time.

NUTRAL SOLUTIONS LIMITED - Analysis Report

Company Number: 13786862

Analysis Date: 2025-07-20 16:56 UTC

1. Credit Opinion: DECLINE
   Nutral Solutions Limited shows significant financial weakness with persistent and large net current liabilities and negative shareholder funds. The company’s current liabilities (£327k) exceed current assets (£89k) by a wide margin, resulting in a net current asset deficit of £238k as of December 2023, which deteriorated only slightly from the prior year. Additionally, total net liabilities stand at £237k, indicating the company is technically insolvent on a balance sheet basis. The company is reliant on a large intercompany loan (£251k owed to Unite People Limited) which is interest-free and repayable on demand, creating liquidity risk. There is no indication of profitability or positive cash flow generation to service debt or fund operations independently. Due to the material negative equity position, lack of profitability disclosure, and reliance on related party funding, credit exposure is high risk without strong external support or guarantees. Approval for credit facilities is not recommended.

2. Financial Strength:
   The balance sheet reflects poor financial strength. Tangible fixed assets are minimal (£1.7k) and do not support operational needs or creditworthiness. Current liabilities exceed current assets by a large margin, driven primarily by trade creditors and significant amounts owed to group undertakings (£251k). The company’s net liabilities and negative shareholders’ funds (£237k) point to accumulated losses and an inability to cover debts from assets. The company is classified as a micro-entity and has limited scale, with only 4 employees on average. While the company claims going concern, the financial position indicates vulnerability without continued related-party financial support.

3. Cash Flow Assessment:
   Cash at bank is low (£21k) compared to current liabilities (£327k), signaling tight liquidity. Debtors have increased significantly to £67.5k, which could represent some potential cash inflows, but the large creditor balances and intercompany loans indicate cash outflows will likely exceed inflows in the short term. Working capital is deeply negative (£-238k), suggesting the company is dependent on either collection of receivables or ongoing related party funding to meet short-term obligations. There is no evidence of positive operating cash flow or reserves to cover liquidity gaps. The risk of cash flow strain is high.

4. Monitoring Points:

• Track cash balances and debtor collections monthly to assess liquidity improvements or deterioration.
• Monitor changes in intercompany loan balances and repayment terms, as this is a key source of funding.
• Watch for any improvement in net current assets or reduction in creditors.
• Review any future profitability or positive cash flow indicators in management accounts.
• Pay attention to director changes and any new financial backing or restructuring that may bolster solvency.
• Ensure timely filing of accounts and confirmation statements to maintain regulatory compliance.