PANINARO MAGAZINE LTD

Executive Summary

Paninaro Magazine Ltd is a micro private company with modest but improving net assets and liquidity, showing positive cash balances and current asset coverage of liabilities. However, limited equity, reliance on director loans, and lack of audit reduce financial transparency. Conditional credit approval is advised with ongoing monitoring of cash flow, profitability, and funding structure to ensure credit risk remains low.

PANINARO MAGAZINE LTD - Analysis Report

Company Number: SC693537

Analysis Date: 2025-07-29 19:39 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Paninaro Magazine Ltd is a very small private limited company operating in publishing and wholesale sectors. The company shows modest but consistent net assets growth over the last three years. Its current liquidity position is positive with net current assets increasing from £4,312 to £6,424 year-on-year. However, the company is early stage (incorporated 2021) and remains small in scale with limited equity (£6,424) and minimal share capital (£100). The presence of director loans (£2,061) indicates some reliance on internal funding. No audit is reported, which limits transparency. Credit approval is recommended on a conditional basis, with careful monitoring of cash flow and profitability trends as the business develops.

2. Financial Strength:
   The company’s balance sheet is stable but very modest. Net assets have risen from £4,312 in 2023 to £6,424 in 2024, driven by retained earnings growth (profit and loss reserve increased from £4,212 to £6,324). Current liabilities are low at £6,013, primarily VAT and director loans. The small equity base and minimal fixed assets imply limited financial buffer to absorb shocks. Overall, financial strength is weak to moderate, typical of a micro enterprise in early growth phase.

3. Cash Flow Assessment:
   Cash balances have increased slightly from £10,629 to £12,437 over the past year, indicating stable liquidity. Net current assets are positive and improving, supporting working capital needs. Director loans highlight some external funding from insiders rather than banks or third parties. The company currently appears able to meet short-term obligations but depends on continued cash inflows to sustain operations. Absence of detailed cash flow statements limits deeper liquidity evaluation.

4. Monitoring Points:

• Monitor profitability trends and ability to generate positive operating cash flow.
• Watch for any increases in director loans or related party transactions that may impact liquidity.
• Confirm timely VAT payments and creditor settlements to avoid potential penalties.
• Track growth in net assets and equity to build a stronger financial foundation for future credit extension.
• Review annual accounts when filed to assess any changes in asset composition or liabilities.