R.L.R. GOLDSMITH LIMITED
Company number 00767895 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Credit Analysis: R.L.R. Goldsmith Limited
1. Credit Opinion: APPROVE
This long-established (incorporated 1963) property development company presents a strong credit profile characterized by a substantial asset base, minimal leverage, and excellent liquidity. The balance sheet shows net assets of £3.1M with negligible borrowings, and the current ratio stands at approximately 10.9x, indicating exceptional capacity to service debt obligations. The company's 60+ year trading history and family stewardship under the Goldsmith family provide additional comfort. The primary consideration is the concentration in property-related assets and the modest apparent profitability, but the overall financial position more than compensates for these factors.
2. Financial Strength
Balance Sheet Composition (FY2025):
| Category | 2025 (£) | 2024 (£) | Movement |
|---|---|---|---|
| Tangible Fixed Assets | 18,154 | 25,657 | (7,503) |
| Investment Property | 1,300,000 | 1,300,000 | - |
| Stocks | 1,132,151 | 1,389,891 | (257,740) |
| Debtors | 3,977 | 27,373 | (23,396) |
| Cash | 824,597 | 576,776 | +247,821 |
| Net Current Assets | 1,781,019 | 1,775,095 | +5,924 |
| Long-term Liabilities | (2,259) | (8,195) | +5,936 |
| Net Assets | 3,096,914 | 3,092,557 | +4,357 |
Key Observations:
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Asset Quality: The balance sheet is dominated by the investment property at £1.3M (historical cost only £181,843), representing 42% of total assets. This externally revalued property provides substantial security but introduces market-value sensitivity.
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Stock Concentration: Stocks of £1.1M represent 37% of total assets. In a property development context, these likely represent development properties or land held for sale. The reduction from £1.39M suggests successful project completions and sales during the period.
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Capital Structure: Essentially ungeared. Share capital of £50,002 plus accumulated reserves of £3,046,912. The revaluation reserve of £1,121,157 reflects historical property appreciation. Debt-to-equity ratio is negligible at approximately 0.07%.
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Retained Earnings Growth: The P&L reserve increased by only £4,357 year-on-year, suggesting modest trading profitability after tax. However, this understates cash generation given the significant stock reduction and cash build.
3. Cash Flow Assessment
Liquidity Position: - Current ratio: 10.9x (2025) / 9.1x (2024) — exceptionally strong - Quick ratio (excl. stocks): 4.6x — more than adequate - Cash represents 42% of current assets, up from 29% in 2024
Working Capital Analysis: - Net current assets of £1.78M provide substantial buffer - Trade creditors of £8,811 are modest relative to stock levels, suggesting the company is not stretching supplier terms - Corporation tax liability of £21,304 (down from £90,567) indicates lower profitability in the period - Other taxation and social security of £86,654 appears high relative to 4 employees — this may warrant clarification (could include VAT or other obligations)
Cash Generation Signals: - Cash increased by £247,821 despite stock reduction of £257,740, suggesting proceeds from property sales were retained rather than distributed - Debtors reduced significantly from £27,373 to £3,977, indicating efficient collections or minimal credit sales - No dividends appear to have been paid (no deduction from reserves noted)
Long-term Obligations: - Only £2,259 remaining on finance lease obligations (down from £8,195), likely for motor vehicles - No bank borrowings or long-term debt facilities evident
4. Monitoring Points
Key Metrics to Watch:
| Metric | Current Position | Concern Threshold |
|---|---|---|
| Current Ratio | 10.9x | Below 3.0x |
| Net Assets | £3.10M | Below £2.5M |
| Cash Position | £824,597 | Below £300,000 |
| Investment Property Value | £1.3M | Material revaluation downward |
| Stock Turnover | Monitor | Increasing stock with declining cash |
Specific Monitoring Considerations:
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Property Market Exposure: The investment property at £1.3M (book cost £181,843) carries significant unrealised gains. A property market downturn could materially impact net assets. Request annual valuation updates and monitor local commercial/residential market conditions in the Biggin Hill/Kent area.
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Stock Realisation: The £1.1M in stocks requires monitoring for ageing or impairment. In property development, slow-moving stock can indicate planning difficulties, market softening, or stalled projects. Request breakdown of stock between development in progress and completed properties held for sale.
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Profitability Trend: The minimal P&L reserve growth (£4,357) despite apparent cash generation warrants investigation. Request profit and loss information to understand trading margins, overhead structure, and whether the business model is shifting from development to investment holding.
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Key Person Risk: The company has only two directors (family members) and 4 total employees. Succession planning and key person insurance should be confirmed for any significant facility.
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Related Party Transactions: The company has used FRS 102 exemption from disclosing transactions with wholly-owned group entities. Clarify the nature and extent of group transactions and any inter-company obligations.
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Tax Liability: The "other taxation and social security" creditor of £86,654 seems disproportionate for 4 employees. This may include VAT or corporation tax instalments — request clarification to ensure no tax compliance issues.
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Filing Compliance: Accounts are current and not overdue. Next accounts due by 31 July 2027. Monitor for timely filing as an indicator of ongoing management attention.