REDBROOK PROJECTS LIMITED

Executive Summary

Redbrook Projects Limited is a micro-entity in its first year of trading that has reported a modest profit and positive net assets. While the company demonstrates compliance and initial operational success, liquidity is constrained by low cash reserves and reliance on receivables. The business sustainability depends heavily on its sole director, and careful monitoring of cash flow and debtor quality is advised.

REDBROOK PROJECTS LIMITED - Analysis Report

Company Number: 15515482

Analysis Date: 2025-07-29 12:55 UTC

1. Risk Rating: LOW

Justification: The company is newly incorporated (February 2024) but has filed timely accounts and confirmation statements with no overdue filings. It reported a small but positive operating profit for the period ending February 2025, with net assets slightly positive at £8. The director is the sole significant controller and also the only employee, which is typical for a micro-entity. There are no indications of insolvency or regulatory issues.

2. Key Concerns:

• Minimal cash balance (£71) relative to current liabilities (£3,797) could pose liquidity constraints despite positive net current assets due to debtors.
• Very limited scale of operations with turnover of only £28,437 and a single director/employee; business sustainability depends heavily on this individual.
• Dividend payout (£10,600) nearly equals profit (£10,607), potentially limiting retained earnings and cash reserves for reinvestment or unforeseen expenses.

3. Positive Indicators:

• Profitability achieved in the first accounting period with operating profit of £13,095 and after-tax profit of £10,607.
• Current assets slightly exceed current liabilities, indicating a positive working capital position.
• Full compliance with statutory filing requirements and no overdue returns or accounts.
• Clear ownership and governance structure with a single director who is also the sole shareholder, reducing governance complexity.

4. Due Diligence Notes:

• Investigate the nature and collectability of trade debtors (£3,734) given the low cash balance.
• Review cash flow forecasts to assess whether the company can sustain operational expenses and dividend payments.
• Confirm the director’s capacity and plans for business growth given the reliance on a single individual.
• Verify any contingent liabilities or off-balance-sheet obligations not disclosed in the accounts.
• Monitor subsequent filings for consistency and any changes in financial position or governance.