PERE PROPERTIES LTD

Executive Summary

PERE PROPERTIES LTD demonstrates modest growth in net assets supported by a property asset base but maintains a tight liquidity position and significant long-term liabilities. The company’s financial strength is adequate for its size with no adverse governance indicators, but cash flow and working capital require ongoing scrutiny. Approval for credit facilities is recommended with conditions emphasizing liquidity monitoring and debt management.

PERE PROPERTIES LTD - Analysis Report

Company Number: 12670333

Analysis Date: 2025-07-20 15:56 UTC

1. Credit Opinion: APPROVE with caution. PERE PROPERTIES LTD is a micro-entity engaged in real estate letting, showing steady but modest net asset growth over recent years. The company has positive net assets (£24,909 as of June 2024) and manageable current liabilities relative to current assets, though long-term liabilities remain significant. The presence of multiple directors with relevant occupations and no negative conduct records supports reasonable governance. However, the reliance on fixed assets and relatively thin equity base suggest limited financial flexibility. Approval is recommended with monitoring of liquidity and gearing.

2. Financial Strength: The balance sheet reveals a fixed asset base of £466,333 primarily likely representing property holdings, down from £666,666 in the prior year, indicating some asset disposals or revaluation. Current assets increased to £16,323, and current liabilities decreased to £31,476, producing a net current asset position of negative £15,153 (note: the accounts document notes this as negative net current assets, but the financial data above states net current assets positive; this requires clarification but overall working capital is tight). Long-term creditors stand at £426,271, resulting in a gearing effect that constrains net assets to £24,909, though this is up from £11,508 in the prior year, showing strengthening equity.

3. Cash Flow Assessment: Liquidity appears marginal with current assets only slightly exceeding current liabilities, indicating limited buffer to meet short-term obligations. The average employee count of 4 suggests ongoing operational costs. Cash flow from operations is not detailed, but given the asset-heavy structure and significant creditors due after more than one year, the company likely depends on rental income or asset sales to service debt. Working capital should be monitored closely to avoid cash shortages, especially as net current asset position is minimal.

4. Monitoring Points:

• Monitor net current assets and liquidity ratios to ensure short-term obligations remain covered.
• Track long-term liabilities to assess gearing and potential refinancing risks.
• Watch for any significant decline in fixed assets that may indicate distress sales.
• Review rental income stability and cash flow from operations regularly.
• Observe director stability and any changes in financial strategy or capital structure.
• Confirm timely filing of accounts and returns to maintain regulatory compliance.