RTM CORPORATION LTD

Executive Summary

RTM CORPORATION LTD, a recently incorporated private limited company, displays significant solvency and liquidity risks, primarily driven by substantial director loans and negative net assets. While regulatory filings are current and ownership structure is clear, the absence of operational activity and negative working capital raise concerns about business sustainability. Further due diligence on funding arrangements and business viability is recommended before investment consideration.

RTM CORPORATION LTD - Analysis Report

Company Number: SC777903

Analysis Date: 2025-07-29 14:17 UTC

1. Risk Rating: HIGH
   The company exhibits significant financial distress, reflected in net liabilities of £37,336 and negative net current assets of the same amount. The level of current liabilities (mainly director loans) far exceeds current assets, indicating poor solvency and liquidity positions for a newly incorporated entity.

2. Key Concerns:

• Negative Net Assets and Working Capital: The company’s liabilities exceed assets by over £37k, signaling an inability to meet short-term obligations from current assets.
• Concentration of Debt with Directors: Substantial current liabilities (£44,719) are loans from directors, which may indicate reliance on insider funding and potential liquidity risk if these loans are called in.
• No Operational Revenue or Employees: With zero employees and no reported turnover, the company’s operational sustainability is questionable, raising concerns about ongoing viability.

3. Positive Indicators:

• Compliance with Filings: Accounts and confirmation statements are up to date with no overdue filings, suggesting regulatory compliance and good governance practices.
• Clear Ownership and Control: The majority shareholder (Mrs. Maira Alyas) holds 75-100% control, which may allow for decisive management actions and potential capital injections if necessary.
• Exemption from Audit: As a small company under FRS 102 Section 1A, the accounts are prepared under standard accounting frameworks, providing some confidence in reported figures.

4. Due Diligence Notes:

• Investigate the nature and terms of director loans to assess the risk of withdrawal or restructuring and their impact on cash flow.
• Clarify the company’s business plan given the lack of employees and revenue; understand how it intends to generate cash flow and achieve operational stability.
• Confirm the absence of contingent liabilities or off-balance sheet obligations that could exacerbate solvency risk.
• Review management’s strategy and funding plans to address negative equity and working capital deficits.