RAPID NETWORK SERVICES LIMITED

Executive Summary

RAPID NETWORK SERVICES LIMITED shows improving financial position with increased net assets and positive working capital, indicating a growing business with some solvency buffer. However, liquidity concerns persist due to high current liabilities and limited financial history, compounded by governance concentration risks. Further due diligence on cash flows, debtor quality, and governance is recommended to fully assess operational sustainability and risk.

RAPID NETWORK SERVICES LIMITED - Analysis Report

Company Number: 13528184

Analysis Date: 2025-07-20 18:37 UTC

1. Risk Rating: MEDIUM

Justification: RAPID NETWORK SERVICES LIMITED shows improving net asset position and positive net current assets as of its latest financial year (2023), indicating some solvency buffer. However, the company’s current liabilities remain substantial relative to current assets, and there is a significant reduction in debtors and overall current assets from the prior year, which may affect liquidity. The company is relatively young (incorporated in 2021) with limited operating history, and financial statements are unaudited abridged accounts, limiting transparency.

2. Key Concerns:

• Liquidity Pressure: Although net current assets improved to £32,270 in 2023 from £5,954 in 2022, current liabilities remain high (£145,735), with notable bank borrowings and overdrafts (£49,640), and increased taxation and social security liabilities (£30,062). The significant reduction in trade debtors and cash position volatility could indicate cash flow management risks.
• Limited Financial History and Transparency: The company has only two full years of financial data and accounts are unaudited abridged, which restricts insight into detailed profitability, cash flows, and contingent liabilities.
• Concentrated Control and Key Person Risk: Control lies predominantly with two directors/shareholders (Mr. and Mrs. Reason), which may pose governance and succession risks should either party be unavailable or act contrary to minority interests.

3. Positive Indicators:

• Improved Solvency: Net assets increased markedly from £6,090 in 2022 to £103,173 in 2023, reflecting capital injections or accumulated profits strengthening financial stability.
• Positive Working Capital: Net current assets moved from a marginal £5,954 to a more comfortable £32,270, suggesting improved short-term liquidity management.
• Compliance with Filing Requirements: No overdue accounts or confirmation statements were noted, indicating good regulatory compliance to date.

4. Due Diligence Notes:

• Verify sources of the improved net assets, including any capital injections or retained earnings, and confirm sustainability of earnings going forward.
• Assess the aging and collectability of trade debtors to evaluate true liquidity position.
• Review cash flow statements (if available) for operational cash generation versus reliance on borrowings.
• Investigate details behind increased taxation and social security creditor balances to understand any potential liabilities.
• Evaluate governance policies given the concentrated shareholding and director control structure.
• Confirm absence of director disqualifications or regulatory issues related to the current or past directors.