Company Number: 12640173

Analysis Date: 2025-07-20 15:48 UTC

1. Risk Rating: HIGH
   The company demonstrates significant solvency risk as evidenced by persistent and increasing negative net assets and net current liabilities. The scale of liabilities far exceeds assets, indicating a poor financial position and potential inability to meet obligations.

2. Key Concerns:

• Severe Negative Net Assets: Net assets have deteriorated from -£8,607 in 2020 to -£105,265 in 2024, reflecting accumulated losses or liabilities exceeding assets.
• Negative Working Capital: Net current liabilities increased to -£134,202 in 2024, indicating liquidity pressures and potential cash flow issues. The company may struggle to cover short-term debts as they fall due.
• Reliance on Directors and Shareholders: Control is concentrated with two directors/shareholders, which may impact governance and raise concerns about financial support or capital injection given the poor financial state.

3. Positive Indicators:

• Timely Filings: The company is current on all statutory filings and confirmation statements, demonstrating compliance with regulatory requirements.
• Stable Employee Base: Employee numbers increased slightly to 8 in 2024, suggesting operational continuity despite financial stresses.
• Incorporated Recently with Micro Entity Status: The company benefits from simplified accounting requirements which may reduce compliance burden and costs.

4. Due Diligence Notes:

• Investigate the nature and origin of the high current liabilities, including any related party debts or contingent liabilities.
• Review detailed cash flow statements, if available, to assess liquidity trends and ability to meet short-term obligations.
• Assess the business model and operational cash generation capacity considering the negative equity and working capital position.
• Confirm any planned or recent capital injections by shareholders or directors to support solvency.
• Examine management plans or forecasts addressing the financial deficit and sustainability strategies.
• Verify the reason for director resignation in 2021 and its impact on governance and operations.