OK BUTCHER LTD

Executive Summary

OK BUTCHER LTD is a micro-entity with a modest but positive working capital position and a very thin equity base. While the company shows early-stage operational growth, its financial resilience is limited by low net assets and ongoing liabilities. Conditional credit approval is recommended with close monitoring of liquidity, profitability, and timely compliance filings.

OK BUTCHER LTD - Analysis Report

Company Number: 14244265

Analysis Date: 2025-07-29 20:31 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   OK BUTCHER LTD is a micro-entity operating in retail meat sales with a short trading history since July 2022. The company shows positive net current assets and a small but positive net asset base, indicating some financial stability. However, the low net assets (£275) and modest scale of operations with only 2 employees limit financial resilience. The reduction in current liabilities from 2023 to 2024 is a positive sign, but long-term creditors remain significant relative to net assets. Given the start-up nature and micro scale, credit approval should be conditional on ongoing monitoring of cash flow and timely filing of accounts.

2. Financial Strength:
   The balance sheet shows total current assets of £4,158 against current liabilities of £1,536, producing net current assets of £2,622, which is healthy for working capital coverage. However, the company has long-term liabilities of £2,347, leading to a modest net asset figure of £275. The equity base is very thin, which poses a risk if unexpected expenses or downturns occur. The company's total assets less current liabilities declined from £3,457 in 2023 to £2,622 in 2024, indicating some asset erosion or increased liabilities. Overall, the financial position is fragile but not impaired.

3. Cash Flow Assessment:
   Current assets primarily consist of cash, receivables, or inventory, supporting short-term liquidity. Net current assets are positive, suggesting the company can cover short-term obligations as they fall due. The increase in employees from 1 to 2 may raise payroll obligations but also indicates business growth. Limited details on profit or cash flow from operations are available, and the micro-entity status means less disclosure. It is advisable to confirm adequate cash flow generation or access to funding sources to service liabilities and support growth.

4. Monitoring Points:

• Track net current asset trends and ensure they remain positive to maintain liquidity.
• Monitor long-term liabilities and any changes in creditor terms or amounts.
• Watch for timely filing of accounts and confirmation statements to avoid compliance risk.
• Review profit/loss trends and cash flow statements when available to assess operational performance.
• Evaluate management's ability to grow the business and strengthen the equity base.