R.M. CONSTANT LTD

Executive Summary

R.M. CONSTANT LTD is an early-stage take-away food business showing negative net assets and working capital deficits, with minimal cash reserves to cover liabilities. The financial position is weak, and the company currently lacks the capacity to service debt. Credit facilities are not recommended until there is clear evidence of improved liquidity and profitability.

R.M. CONSTANT LTD - Analysis Report

Company Number: 14305817

Analysis Date: 2025-07-20 17:06 UTC

1. Credit Opinion: DECLINE. R.M. CONSTANT LTD exhibits significant financial distress as evidenced by negative net assets and shareholders' funds exceeding £11,000 in deficit within its first full financial year. The company’s cash balance is negligible (£326) and it has current liabilities of £11,725, resulting in net current liabilities of £11,399. This indicates an inability to meet short-term obligations from liquid resources, raising concerns about ongoing solvency and repayment capacity. The company is a start-up in the take-away food sector, which is competitive and vulnerable to market fluctuations. Without demonstrated profitability or positive working capital, there is high credit risk.

2. Financial Strength: The balance sheet reveals net liabilities of £11,399, with no fixed assets reported, indicating the company is financed primarily by liabilities and has no long-term asset base to support borrowing. Shareholders' funds are negative, reflecting accumulated losses or initial funding deficits. The absence of audit requirements and limited disclosure restricts deeper insight, but the financial position at this early stage is weak and undercapitalized. The entity meets micro company filing thresholds but has yet to establish a stable financial footing.

3. Cash Flow Assessment: With only £326 cash available against current liabilities of £11,725, liquidity is critically constrained. This negative working capital position suggests reliance on external funding or creditor support to sustain operations. The company’s ability to generate operating cash flows is unproven, and there is no indication of cash reserves or committed facilities to cover short-term obligations. This liquidity deficiency poses a material risk for credit extension.

4. Monitoring Points:

• Improvement in net current assets and liquidity position.
• Evidence of positive cash flow generation from operations.
• Reduction or management of current liabilities, especially tax and social security obligations.
• Growth in turnover and profitability to build retained earnings and strengthen equity.
• Stability and experience of management in navigating early-stage operational risks.