Company Number: 13337251

Analysis Date: 2025-07-29 19:28 UTC

1. Risk Rating: MEDIUM
   Ocean Iris Limited demonstrates solid net asset growth and healthy net current assets, supported by substantial cash balances. However, the company carries significant long-term unsecured loans to a related party, which could pose refinancing or related-party dependency risks. Absence of audited accounts and limited disclosure on profitability restricts a full risk assessment.

2. Key Concerns:

• High Loan Exposure to Related Party: Loans totaling approximately £981k from Lonetree Limited, controlled by a close family member, create concentration and related-party risk. These loans are unsecured and repayable over 10 years but represent a material liability relative to net assets.
• Lack of Audit and Profit & Loss Disclosure: The company qualifies for small company exemptions and has not submitted audited accounts or an income statement, limiting transparency on operational performance and profitability trends.
• Increase in Current Liabilities and Creditors: Current liabilities rose notably from £621k in 2022 to £892k in 2023, driven by trade creditors, VAT, accrued expenses, and director’s current accounts. While current assets exceed liabilities, the increase warrants monitoring for liquidity pressure.

3. Positive Indicators:

• Strong Cash Position and Net Current Assets: Cash at bank increased to £1.55m in 2023, significantly exceeding current liabilities, indicating good short-term liquidity. Net current assets improved to £775k, providing a buffer against short-term obligations.
• Net Asset Growth: Shareholders’ funds increased from £424k in 2022 to £552k in 2023, reflecting retained earnings accumulation and overall balance sheet strengthening.
• Consistent Director and Secretary Appointments: Stable management with the same director and secretary since incorporation suggests continuity in governance.

4. Due Diligence Notes:

• Obtain management accounts or other financial data to assess profitability, cash flow generation, and debt servicing capacity given absence of P&L in filings.
• Clarify terms and covenants of the loans from Lonetree Limited, including interest rates, repayment schedules, and any potential cross-default clauses.
• Review any related party transactions beyond loans and sales/purchases with Lonetree Limited to understand operational and financial interdependencies.
• Confirm status of tax liabilities given corporation tax creditor of £16k and deferred tax provision of £85k.
• Assess the company’s business model sustainability in the highly competitive take-away food sector, including customer concentration, franchise arrangements (noted franchise rights intangible asset), and operational scalability.