Company Number: 13560192

Analysis Date: 2025-07-20 15:39 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   PITA LUV LIMITED demonstrates a modest but stable financial position with positive net assets and working capital as of the latest fiscal year ending August 2024. However, there has been a significant reduction in current assets and net assets compared to prior years, indicating a contraction in liquidity and capital base. The company is relatively young, incorporated in 2021, operating in the take-away food sector, and currently active with no overdue filings. The single director structure and control by a corporate PSC (Fd Secretarial Ltd) suggest centralized management. Lending or credit extension should be conditional on updated cash flow forecasts and confirmation of ongoing operational profitability to ensure debt servicing capability.

2. Financial Strength:

• Net assets decreased from £24,949 in 2023 to £11,632 in 2024, indicating erosion of equity possibly due to losses or distributions.
• Tangible fixed assets stand at £9,880 with depreciation charged appropriately.
• Working capital remains positive at £3,629 but has declined sharply from £14,946 the prior year, reflecting tightening liquidity.
• The company holds minimal debt falling due within one year (£9,396), which is manageable against current cash of £13,025.
• Shareholders’ funds have halved, raising a concern about financial resilience if adverse conditions persist.

3. Cash Flow Assessment:

• Cash reserves have substantially decreased from £44,947 to £13,025 in one year.
• No debtors reported at year-end, which may suggest limited credit sales or effective collection, but also potential revenue contraction.
• Current liabilities have reduced from £33,740 to £9,396, possibly through repayments or lower accruals, easing short-term pressures.
• The reduction in net current assets and cash indicates working capital is under strain, requiring close monitoring.
• Absence of income statement details limits cash flow trend analysis; however, the company’s cash burn rate should be clarified before extending further credit.

4. Monitoring Points:

• Track monthly cash flow and liquidity ratios to detect early signs of stress.
• Monitor any changes in director or PSC control for governance risks.
• Review subsequent management accounts and trading updates for turnaround or further decline evidence.
• Watch for any overdue filings or compliance issues as potential warning signals.
• Assess impact of any market changes in the takeaway food sector on company revenues and profitability.