PLATFORM INVESTMENT SOLUTIONS LIMITED

Executive Summary

Platform Investment Solutions Limited holds valuable investment property assets but is highly leveraged with significant short-term liabilities exceeding current assets. While recent cash balance improvements and profits are positive, the company’s negative net assets and working capital deficits present repayment risk. Conditional credit approval is recommended with strict monitoring of liquidity, asset valuations, and director support mechanisms to mitigate financial risks.

PLATFORM INVESTMENT SOLUTIONS LIMITED - Analysis Report

Company Number: SC696299

Analysis Date: 2025-07-29 19:23 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Platform Investment Solutions Limited operates in the real estate letting sector with a small team and a relatively recent incorporation date (2021). The company holds significant investment property assets (£777k fair value as of 2024) but shows net liabilities on the balance sheet (£4,946 negative net assets), primarily due to high secured debt (£517k mortgage secured against properties) and large current liabilities exceeding current assets by £281k. While the company is generating some profit (£1,848 in 2024) and appears to have potential for asset value growth, the high gearing and negative working capital present repayment risk. Approval may be considered with conditions such as close monitoring of cash flows, debt servicing ability, and requiring personal or director guarantees given the reliance on director support and related party balances.

2. Financial Strength:
   The company’s fixed asset base is solid, focused on investment property that increased in valuation from £605k to £777k in 2024. However, the company's balance sheet is leveraged with secured loans (£517k) exceeding the net asset value, and current liabilities substantially higher than current assets, resulting in negative net current assets of £281k. Shareholders’ funds remain negative, though improved slightly from previous years. The company’s large related party balances (£210k due to directors, £121k to director-owned companies) are interest-free and repayable on demand, indicating director support but also concentration risk. Overall, the financial structure is weak, with high leverage and liquidity pressure.

3. Cash Flow Assessment:
   Cash balances improved substantially in 2024 (£69k) from prior year (£3.4k), which is a positive liquidity indicator. However, current liabilities are high (£359k), implying a working capital deficit. The company relies on director loans and related party funding to bridge cash flow gaps, which may not be sustainable long-term without operational cash generation. The operating cash flow is not disclosed, but net profit and revaluation gains suggest some income, yet the cash flow is stressed due to high short-term liabilities and debt repayments. Immediate liquidity risk exists, and cash flow forecasting and management will be critical.

4. Monitoring Points:

• Monthly monitoring of cash flow and working capital management to ensure liabilities can be met.
• Regular review of property valuations and market conditions impacting asset values and collateral coverage.
• Watch director loan balances and related party creditor terms for any changes that might impact liquidity.
• Assess profitability trends and any rental income fluctuations to gauge operational sustainability.
• Monitor compliance with loan covenants and any security arrangements on properties.