PCA EVENTS LIMITED

Executive Summary

PCA EVENTS LIMITED is a small, newly established event catering business with limited financial resources and a modest equity base. The company currently shows a working capital shortfall, indicating liquidity risk that warrants cautious credit exposure. Ongoing monitoring of cash flow and current liabilities is essential to manage credit risk effectively.

PCA EVENTS LIMITED - Analysis Report

Company Number: 13527845

Analysis Date: 2025-07-29 15:53 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   PCA EVENTS LIMITED is a micro-entity operating in event catering since 2021, showing steady but very modest net asset growth from £347 in 2021 to £19,741 in 2024. The company’s current liabilities exceed current assets by approximately £20k, resulting in negative net current assets, which suggests a working capital shortfall and potential liquidity constraints. However, the presence of positive net assets and shareholder funds, albeit small, indicates some equity buffer. Given the company’s short trading history, micro size, and limited financial resources, credit should be extended cautiously, possibly with limits on exposure and regular monitoring. The directors include a Chartered Accountant, which adds some confidence in financial stewardship.

2. Financial Strength:
   The balance sheet reflects a micro-entity with minimal fixed or intangible assets, relying primarily on current assets (cash/debtors) to meet short-term obligations. Current liabilities are slightly higher than current assets, signaling a net current liability position (-£19,741). Despite this, total net assets remain positive at £19,741, indicating that the company’s liabilities beyond current obligations are minimal or offset by shareholder equity. The growth in net assets from prior years is positive but modest, reflecting a small but stable equity base without significant borrowing or capital investment. The company’s small scale and limited retained earnings restrict financial resilience to shocks.

3. Cash Flow Assessment:
   The working capital deficit implies that PCA EVENTS LIMITED may face challenges in meeting immediate creditor demands without additional cash inflows or financing. The company employs only one average employee, which keeps overheads low. Cash generation capacity cannot be fully assessed from the limited data, but the negative net current assets and lack of fixed assets suggest dependency on timely debtor collections and cash management. Liquidity risk exists, especially if there are delays in receivables or unexpected expenses. Any credit facility should be structured to support short-term liquidity needs with clear repayment terms.

4. Monitoring Points:

• Monitor quarterly cash flow performance and debtor collection cycles to ensure liquidity remains adequate.
• Watch for any increase in current liabilities or deterioration in net current assets that may signal worsening short-term financial stress.
• Track profitability trends and retained earnings development in future accounts to assess capacity for building reserves.
• Review director changes and any shifts in management or ownership that might impact financial strategy or risk tolerance.