Company Number: 13112530

Analysis Date: 2025-07-20 12:25 UTC

1. Risk Rating: MEDIUM
   The company exhibits a solid asset base primarily in fixed assets (investment properties), but significant current liabilities and negative net current assets raise concerns regarding short-term liquidity. The presence of substantial secured bank loans and an ongoing negative working capital position suggests moderate solvency risk, though the overall net asset position remains positive.

2. Key Concerns:

• Negative Net Current Assets: Current liabilities (~£2.34M) substantially exceed current assets (~£7.5k), indicating potential liquidity challenges to meet short-term obligations.
• High Secured Debt: Bank loans secured against assets total approximately £1.48M, which represents a significant financial leverage that could strain cash flows if rental income or property values decline.
• Negative Debtors Balance: The accounts show negative debtor values (~-£12k), which may indicate accounting anomalies or receivables adjustments that require clarification.

3. Positive Indicators:

• Strong Fixed Asset Base: Tangible fixed assets valued around £2.72M provide a robust collateral base and underpin the company’s investment property activities.
• Positive Net Assets and Shareholders’ Funds: Net assets stand at about £330k, showing that total assets exceed liabilities and equity is positive.
• Compliance and Timely Filings: The company is active, not in liquidation, and has no overdue filings, suggesting good regulatory compliance and governance.

4. Due Diligence Notes:

• Investigate the nature and collectability of debtor balances, particularly the negative debtor figure, to confirm accounting accuracy.
• Review the terms and repayment schedule of the secured bank loans to assess refinancing risk and impact on cash flows.
• Examine the operating cash flows or rental income streams supporting loan servicing and working capital needs.
• Confirm if any contingent liabilities or off-balance sheet obligations exist that could affect solvency.
• Assess directors’ plans for addressing negative working capital and any capital injection or restructuring initiatives underway.