ROBOROUGH DEVELOPMENTS (SW) LTD

Executive Summary

Roborough Developments (SW) Ltd is an early-stage construction company showing signs of financial distress, particularly concerning its liquidity and working capital position. While there are positive signs of asset growth and improved net equity, the company’s heavy reliance on director loans and negative net current assets warrant careful scrutiny. Prospective investors should conduct detailed due diligence on cash flow and financing arrangements before committing capital.

ROBOROUGH DEVELOPMENTS (SW) LTD - Analysis Report

Company Number: 13885794

Analysis Date: 2025-07-29 19:12 UTC

1. Risk Rating: HIGH
   Roborough Developments (SW) Ltd shows a high-risk profile primarily due to its negative working capital position, high current liabilities relative to current assets, and reliance on director loans. Although the net assets have improved recently, the company’s liquidity position remains fragile.

2. Key Concerns:

• Negative Net Current Assets: As of 29 February 2024, the company has net current liabilities of £36,162, indicating potential difficulties in covering short-term obligations with current assets.
• High Director Loan Account: The company owes £72,744 to directors, which constitutes the majority of current liabilities, suggesting dependence on director financing rather than operational cash flow.
• Operating Losses and Past Negative Equity: The company reported negative shareholders’ funds of £12,651 in the prior year (2023), indicating previous losses and financial distress that may impact sustainability.

3. Positive Indicators:

• Improved Net Assets: From a negative net asset position in 2023 (-£12,651), the company has moved to positive net assets of £8,918 in 2024, showing some recovery.
• Tangible Fixed Asset Growth: Fixed assets increased significantly to £45,080, primarily from plant and machinery additions, which could enhance operational capacity.
• Compliance and Timely Filing: The company is up to date with both accounts and confirmation statement filings, demonstrating regulatory compliance and governance discipline.

4. Due Diligence Notes:

• Investigate the nature and terms of the director loan account to assess repayment risk and any potential personal liability for directors.
• Review cash flow statements and contracts in progress to evaluate operational revenue generation and cash conversion capabilities.
• Clarify the company’s business plan and revenue projections to understand how it intends to improve liquidity and reduce reliance on director loans.
• Confirm the related party transactions and any contingent liabilities that may not be reflected in the balance sheet.
• Assess the reason for the significant fixed asset acquisition and whether this is aligned with sustainable revenue growth.