Company Number: 13638404

Analysis Date: 2025-07-29 13:45 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   ROYYCO LTD demonstrates a stable financial position as a small, private limited company operating in clinical psychology. The company has positive net assets and working capital, showing ability to meet short-term obligations. However, there is a downward trend in net assets and cash balances over the past two years, alongside a modest provision for deferred tax. Given the company’s small scale, limited operational history since 2021, and reliance on two directors who are also the primary shareholders, credit should be extended with conditions such as regular financial monitoring and confirmation of ongoing cash flow sufficiency.

2. Financial Strength:
   The balance sheet reflects a modest but positive net asset base of approximately £26.6k as of 30 September 2024, down from £31.6k the previous year. Fixed assets are minimal (£1,249) and mainly consist of plant and machinery. Current assets total about £58k, primarily cash (£29.9k) and trade debtors (£28k). Current liabilities stand at £32.4k, mainly corporation tax, VAT, and accrued expenses. The company maintains positive net current assets of £25.6k, indicating reasonable short-term financial health. The decline in net assets and cash reserves warrants scrutiny but no immediate concern given the scale.

3. Cash Flow Assessment:
   Cash at bank has decreased from £34.8k to £29.9k year-on-year, showing some reduction in liquidity. Trade debtors remain substantial but slightly reduced, implying steady but slightly slower cash inflows from clients. Current liabilities, including tax and VAT payables, are significant but appear manageable with the available cash and working capital. The company employs two staff and operates with low fixed assets, likely limiting capital expenditure demands. Overall, liquidity is adequate to meet obligations but requires monitoring to ensure no cash flow pressures develop.

4. Monitoring Points:

• Continued trend in net assets and cash position to detect any further erosion of financial strength.
• Timely payment of corporation tax and VAT liabilities to avoid penalties or cash flow disruption.
• Debtor collection efficiency and ageing profile to ensure receivables convert into cash promptly.
• Any changes in directors or ownership structure, given the significant control by Dr Hannah Twiddy.
• Operating performance indicators once turnover and profit data become available to confirm business viability.