Company Number: 13992763

Analysis Date: 2025-07-20 17:00 UTC

1. Risk Rating: HIGH
   The company exhibits a highly leveraged financial position with current liabilities nearly equal to current assets but a significant amount of creditors due after more than one year, resulting in minimal net equity. Net assets and shareholders’ funds remain extremely low (£130), suggesting limited capital buffer and potential solvency concerns.

2. Key Concerns:

• Solvency Risk: Despite positive net current assets, the company’s net assets are only £130, and the very large long-term liabilities (£2.51M) almost fully offset total assets, indicating potential solvency strain.
• Liquidity Concerns: Cash balances are nominal (£181), which is very low relative to current liabilities (£2.51M). This could impair the company’s ability to meet short-term obligations promptly.
• Operational Sustainability: The company was incorporated in 2022 and shows limited fixed assets and minimal equity, with a financial structure highly dependent on liabilities. The absence of a profit and loss account (due to abridged filing) limits insight into operational profitability or cash flow generation.

3. Positive Indicators:

• Timely Compliance: The company is current with both accounts and confirmation statement filings, reflecting sound regulatory compliance and governance practices.
• Controlled Ownership and Management: Ownership and directorship are consolidated under a single individual, which can facilitate decision-making agility.
• Growing Asset Base: Current assets increased from £1.65M (2023) to £2.35M (2024), predominantly in stocks (work in progress), suggesting ongoing development activity consistent with the company’s SIC codes related to building development.

4. Due Diligence Notes:

• Obtain detailed profit and loss and cash flow statements to assess operational profitability and liquidity beyond balance sheet data.
• Clarify the nature and terms of the long-term liabilities (£2.51M) to evaluate repayment schedules and covenants.
• Investigate the composition and valuation methodology of stocks/work in progress (£2.34M) to understand realizability and risk of impairment.
• Assess related party transactions or guarantees, especially given single director ownership structure.
• Review director’s background and any potential risks associated with governance concentration.