PIMBLETTS BAKERY & CONFECTIONERY LTD

Executive Summary

Pimbletts Bakery & Confectionery Ltd operates with a recurring negative working capital position and limited cash reserves, undermining its ability to service debt obligations reliably. Although net assets have grown modestly, the company remains undercapitalised with current liabilities significantly exceeding current assets. Without improvements in liquidity or capital structure, extending credit is not recommended.

PIMBLETTS BAKERY & CONFECTIONERY LTD - Analysis Report

Company Number: 13205586

Analysis Date: 2025-07-29 12:10 UTC

1. Credit Opinion: DECLINE. Pimbletts Bakery & Confectionery Ltd exhibits a persistently weak liquidity position, with net current liabilities exceeding £115k for the past three years. The current liabilities substantially exceed current assets, and the company remains reliant on external funding to meet short-term obligations. Despite some growth in net assets (£21.9k in 2024 vs £11.9k in 2023), the liquidity shortfall and negative working capital trend pose a material risk to timely debt servicing. Given the high current liabilities relative to cash and debtors, the company’s ability to service new or extended credit facilities is doubtful without significant improvement in cash flow management or capital injection.

2. Financial Strength: The balance sheet shows modest net assets of £21,921 as of February 2024, up from £11,934 the prior year, indicating some retained earnings accumulation. Fixed assets are substantial at circa £150k, consisting mainly of equipment and motor vehicles, suggesting investment in operational capacity. However, the company carries notable creditor balances: £172,523 due within one year and a further £12,500 due after one year. The share capital is nominal (£2), reflecting a small equity base. Overall, the company is undercapitalised relative to its liabilities and has a weak equity cushion to absorb shocks.

3. Cash Flow Assessment: Cash at bank declined sharply from £83,424 in 2023 to £16,963 in 2024, indicating cash burn or working capital strain. Debtors remain low at £3,499, but combined with high current liabilities (£172,523), this creates negative net working capital of -£115,561. The company’s working capital deficit has worsened slightly over the years and is a key liquidity concern. The limited cash buffer and high payables imply potential difficulty in meeting short-term obligations without refinancing or improved cash inflows.

4. Monitoring Points:

• Liquidity trends: Regularly monitor cash balances and current liabilities to detect worsening working capital gaps.
• Creditor payment behaviour: Watch for delays or disputes that may indicate cash flow stress.
• Profitability and cash generation: Assess future filings for improvement in operating cash flows.
• Capital structure: Any plans for equity injection or debt restructuring should be tracked to support balance sheet strength.
• Directors’ compliance with filing deadlines and operational updates to signal management quality and business continuity.