RHSF CONTRACTING LTD

Executive Summary

RHSF Contracting Ltd presents a moderate risk profile characterized by positive but declining net assets and increased current liabilities. The company has maintained regulatory compliance and exhibits some liquidity cushion, but the limited operating history and weakening balance sheet metrics warrant further investigation before investment. Overall, operational and financial sustainability remain key areas for due diligence.

RHSF CONTRACTING LTD - Analysis Report

Company Number: 13841702

Analysis Date: 2025-07-29 20:23 UTC

1. Risk Rating: MEDIUM
   RHSF Contracting Ltd shows a stable micro-entity profile with positive net current assets and shareholders’ funds, but there is a marked decline in net assets from the prior year and some increase in short-term liabilities, which introduces moderate solvency and liquidity risk. The company’s very recent incorporation (2022) and limited financial history further constrain risk assessment confidence.

2. Key Concerns:

• Declining Net Assets: Net assets decreased from £12,665 in 2023 to £5,730 in 2024, indicating a reduction in equity that may reflect operational losses or increased liabilities.
• Increased Current Liabilities: Current liabilities nearly doubled from £13,810 to £27,039 year-over-year, compressing working capital and potentially signaling cash flow pressures.
• Limited Operating History: Incorporated in early 2022 with only two years of financial data limits the ability to evaluate long-term operational stability and performance trends.

3. Positive Indicators:

• Positive Net Current Assets: Despite the increase in liabilities, net current assets remain positive at £5,069, suggesting the company can meet short-term obligations presently.
• No Overdue Filings: Accounts and confirmation statements are filed on time, indicating good compliance with regulatory obligations.
• Clear Control Structure: The company has a straightforward ownership and management structure with no director disqualifications reported, which reduces governance risk.

4. Due Diligence Notes:

• Financial Performance Details: Obtain profit and loss accounts and cash flow statements to understand the causes behind the decline in net assets and increase in liabilities.
• Debt Maturity Profile: Clarify the nature and repayment terms of the £6,750 long-term creditors and assess any covenant or refinancing risk.
• Client and Revenue Stability: Investigate client contracts and revenue sources given the company’s IT consultancy SIC code, to evaluate operational sustainability.
• Director and Shareholder Background Checks: Further background inquiries on the main controlling individuals for any undisclosed risks.
• Future Business Plans: Review management’s strategy and forecasts to assess prospects for reversing the asset decline and improving liquidity.