Investment Risk Analysis: ROBERT ROONEY LIMITED

1. Risk Rating: LOW

Justification: This company demonstrates strong solvency with net assets of £322,158, a healthy current ratio of approximately 3.5x, and substantial cash reserves of £244,413 representing over 54% of total assets. The business has undergone significant deleveraging since 2017-2018 (when total liabilities exceeded £300-500k) and now maintains a conservative liability structure. Filing obligations are current, and the company has a 20+ year operating history.

2. Key Concerns

1. Inventory Concentration Risk Stocks of £177,640 represent approximately 42% of current assets. For a motorcycle sales and repair business (SIC 45400), this inventory could include aging or seasonal stock that may be subject to impairment or obsolescence, particularly if models become outdated. The accounts provide no breakdown or provision information.

2. Rising Current Liabilities Current liabilities increased by approximately 67% from £71,666 (2024) to £120,064 (2025). While still well-covered by current assets, this significant year-on-year increase warrants investigation—particularly whether this reflects trade creditor growth (potentially healthy if aligned with increased activity) or short-term borrowing (which would be less favorable).

3. Limited Financial Visibility The company files as a small entity under FRS 102 Section 1A with abridged, unaudited accounts. This means no profit & loss account, turnover figures, or detailed expense breakdowns are publicly available. Assessing operational performance, margin trends, and true trading health is severely constrained by this disclosure regime.

3. Positive Indicators

• Strong Deleveraging Track Record: Total liabilities have been reduced from £521,997 (2016) and £302,552 (2018) to approximately £129,464 (2025). This demonstrates disciplined liability management over a sustained period.

• Robust Cash Position: Cash of £244,413 has grown significantly from £86,291 in 2022 and now exceeds total liabilities. This provides substantial operational flexibility and a buffer against trading disruptions.

• Consistent Net Asset Growth: Shareholders' funds have grown from £211,518 (2016) to £322,158 (2025), representing approximately 52% growth over nine years, indicating retained profitability and value accumulation.

• Regulatory Compliance: Accounts and confirmation statements are filed on time with no overdue status. The company has maintained active status since 2003.

• Low Gearing: With only £9,400 in long-term creditors and minimal share capital of £100, the business operates with very low leverage—net assets are almost entirely funded by retained profits.

4. Due Diligence Notes

Priority Investigations:

1. Revenue and Profitability Trends: Request management accounts or full financial statements to assess turnover trajectory, gross margins, and net profit. The retained earnings increased by £4,502 in 2025 (from £317,556 to £322,058), which appears modest—confirm whether dividends have been extracted or if trading profits have compressed.

2. Inventory Quality and Turnover: Request inventory aging analysis and stock provision policies. For a motorcycle dealer, understand the mix of new versus used stock, parts inventory, and any manufacturer stocking obligations that may not be readily sellable.

3. Liability Composition: Obtain breakdown of the £120,064 current liabilities—specifically the split between trade creditors, accruals, tax liabilities, and any short-term borrowings. The 67% increase year-on-year requires explanation.

4. Key Person Dependency: The company has only two officers (Robert William Rooney as director and Donna Craig Michelle Rooney as secretary), both apparently from the same family. Assess succession planning and key person insurance arrangements.

5. Long-term Creditor Details: Clarify the nature of the £9,400 falling due after one year—whether this represents finance leases, loans, or other obligations, and the terms attached.

6. Fixed Asset Composition: Tangible assets of £29,569 appear modest for a motorcycle dealership. Confirm whether the business owns or leases its premises (registered address appears to be a yard in Swanbourne), and whether any property assets are held personally by directors rather than within the company.

7. PSC Verification: Robert William Rooney holds 50-75% of shares. Confirm the identity of the remaining shareholder(s) and whether Donna Rooney holds shares independently, as this affects control dynamics.