PLANET IOT LTD

Executive Summary

Planet IoT Ltd is currently facing high financial risk due to significant negative working capital and shareholders' funds, coupled with a sharp decline in cash reserves. While regulatory compliance is maintained and directors have pledged support, the company’s solvency and operational sustainability remain uncertain without additional capital or business growth. Further due diligence on cash flow plans and liabilities is critical before considering investment.

PLANET IOT LTD - Analysis Report

Company Number: 13559781

Analysis Date: 2025-07-19 12:55 UTC

1. Risk Rating: HIGH

The company exhibits significant financial distress evidenced by persistent negative net current assets and shareholders' funds, which have worsened from -£34,243 in 2023 to -£66,492 in 2024. Such a position raises serious concerns about solvency and the ability to meet short-term liabilities.

2. Key Concerns:

• Solvency Risk: The company’s liabilities due within one year (£73,521) far exceed its current assets (£7,129), resulting in a negative working capital of -£66,392. This indicates a clear risk of insolvency if current obligations cannot be refinanced or settled.
• Liquidity Concerns: Cash reserves have dramatically decreased from £20,644 in 2023 to £3,693 in 2024. This rapid cash depletion could impair operational capability and increase dependence on director loans or external financing.
• Operational Sustainability: The company has only one employee on average and appears heavily reliant on director support, as noted in the directors' statement regarding going concern. The lack of operational scale and recurring losses undermines confidence in the business model’s viability without additional capital or revenue growth.

3. Positive Indicators:

• Timely Compliance: The company is current with its statutory filings and accounts submissions, indicating good governance and regulatory compliance.
• Director Support: The directors have demonstrated commitment to support the company financially for at least the next 12 months, which may provide short-term stability.
• Industry Classification: Operating in data processing and hosting (SIC 63110) suggests engagement in a growing sector with potential for future scalability and revenue generation.

4. Due Diligence Notes:

• Review the company’s cash flow forecasts and funding arrangements to assess the sustainability of director support and plans to address negative working capital.
• Investigate the nature and terms of the loans of £4,500 due within one year and any other contingent liabilities not disclosed.
• Examine revenue trends and client contracts, if available, to evaluate operational progress and growth prospects.
• Confirm whether the company has received any formal warnings or notices from Companies House or tax authorities.
• Assess the background and conduct records of directors to ensure no past disqualifications or governance issues.