PUNCH HOUSE LTD

Executive Summary

Punch House Ltd is currently financially distressed with significant negative equity and liquidity issues, indicating poor ability to meet short-term liabilities and service debt. The company’s financial trajectory shows worsening net liabilities and inadequate working capital, undermining creditworthiness. Without clear evidence of turnaround or capital support, credit extension is not advised at this time.

PUNCH HOUSE LTD - Analysis Report

Company Number: 13917474

Analysis Date: 2025-07-29 20:41 UTC

1. Credit Opinion: DECLINE
   Punch House Ltd exhibits a weak financial position with increasing net liabilities and negative net current assets worsening over the last two years. The company’s balance sheet shows escalating current liabilities far exceeding current assets, indicating poor liquidity and inability to meet short-term obligations. Without profitability data, the negative equity and growing deficit suggest ongoing losses and insufficient capital support. The absence of employees implies limited operational scale or possible inactivity. Given these factors, the company is unlikely to service new or increased credit facilities reliably at this stage.

2. Financial Strength:
   The company is categorised as Micro with total net liabilities of £50,156 as at 31 March 2024, deteriorating from a net liability of £12,080 the previous year. Fixed assets are minimal (£4,823), and current liabilities (£153,444) significantly surpass current assets (£99,142), resulting in negative working capital of £54,229. Shareholders’ funds are negative, reflecting accumulated losses or capital erosion. This indicates weak capital structure, high leverage, and poor solvency metrics, raising concerns about ongoing viability without fresh equity injection or debt restructuring.

3. Cash Flow Assessment:
   Current liabilities exceeding current assets by over £54k suggest liquidity strain. The company likely faces cash flow difficulties meeting short-term creditor demands. No data on cash equivalents or operating cash flow is available, but the worsening net current liabilities imply negative working capital cycle and potential reliance on external funding or creditor leniency. The absence of employees might reduce cash burn from wages but may limit revenue generation. Overall, cash flow is inadequate for comfortable debt servicing or operational needs.

4. Monitoring Points:

• Monitor future filings for improvement or further deterioration in net assets and working capital.
• Watch for any capital injections or shareholder loans that could improve the equity base.
• Track payment patterns to suppliers and creditors for signs of delayed payments or defaults.
• Assess any operational changes or strategic plans by directors to restore financial health.
• Review any new credit facilities sought and their terms to gauge risk exposure.