Company Number: 12896446

Analysis Date: 2025-07-29 19:37 UTC

1. Credit Opinion: APPROVE

ORRLO LIMITED demonstrates improving financial health with a solid liquidity position and positive net current assets. The company operates within the small company exemption regime, showing no overdue filings, which suggests good compliance and governance. While share capital is modest, the company’s net assets nearly doubled from £59,690 in 2023 to £108,845 in 2024, reflecting growth. The principal activity is in a low-risk service sector (SIC 96090). No adverse director conduct or insolvency flags are present. Overall, the company appears capable of meeting its debt obligations and sustaining operations.

2. Financial Strength:

The balance sheet shows a stable asset base with minimal fixed assets (£1,980) but healthy current assets (£243,718), mainly debtors (£201,072) and cash (£42,646). Current liabilities increased moderately to £136,853 but net current assets remain strong at £106,865, indicating good working capital management. Shareholders’ funds remain consistent at £120,000, with a reduced deficit in the profit and loss reserve (-£11,155 vs -£60,310 previously), signifying improving profitability or retained earnings. The company’s capital structure is equity-heavy with no reported bank loans or long-term debt, enhancing resilience.

3. Cash Flow Assessment:

Cash on hand (£42,646) is sufficient to cover about 31% of current liabilities, which is adequate but somewhat lower than the prior year (£56,201). However, together with high debtors, the company has a comfortable liquidity buffer. The increase in debtors from £113,392 to £201,072 warrants monitoring for collection risk, but overall net current assets improved significantly, supporting short-term cash flow. No indications of liquidity stress or overdue obligations are evident. Working capital is managed effectively with net current assets almost doubling from the prior year.

4. Monitoring Points:

• Debtor aging and collectability: The substantial rise in receivables should be reviewed regularly to ensure timely collections.
• Cash conversion cycle: Monitor cash levels relative to liabilities to avoid liquidity squeeze.
• Profitability trends: The reduction in retained losses is positive, but ongoing profit generation is needed to build reserves.
• Director changes: Note the resignation of a director in March 2024; ensure stable management continuity.
• Industry developments: The company’s classification in “Other service activities not elsewhere classified” may warrant review for sector-specific risks.