SAPPHIRE SECURITY SERVICES LTD

Executive Summary

Sapphire Security Services Ltd demonstrates significant financial weaknesses, including persistent negative working capital and declining shareholders’ funds, indicating poor liquidity and capital adequacy. The company’s current financial profile does not support credit extension without corrective measures or enhanced financial backing. Ongoing monitoring of liquidity and profitability is essential to reassess creditworthiness as the business evolves.

SAPPHIRE SECURITY SERVICES LTD - Analysis Report

Company Number: 14225639

Analysis Date: 2025-07-20 11:12 UTC

1. Credit Opinion: DECLINE
   Sapphire Security Services Ltd shows a very weak financial position with persistent negative net current assets and minimal net asset value. The company has been operating for around two years but exhibits no improvement in liquidity or working capital. Current liabilities consistently exceed current assets by a large margin (~£25k deficit). This indicates an ongoing inability to meet short-term obligations, raising significant credit risk. No signs of profit generation or retained earnings are evident. Given this financial instability and micro size, the company is currently not a suitable candidate for credit facilities without substantial financial restructuring or external support.

2. Financial Strength:
   The balance sheet reveals fixed assets of approximately £26k and very limited current assets (~£762). Current liabilities stand near £26.5k, resulting in a net current liability position of -£25,727 as at 31 July 2024. Shareholders’ funds have decreased from £1,137 to £544 year-on-year, illustrating erosion of equity. The company’s capital base is minimal and declining, suggesting weak financial strength and vulnerability to cash flow shocks or unexpected expenses.

3. Cash Flow Assessment:
   The company’s cash and equivalents are very low, and the negative working capital position points to insufficient liquidity to cover short-term debts. Without adequate current assets, the company likely relies on external funding or shareholder advances to continue operations. The lack of retained earnings or reserves further undermines its ability to generate or sustain positive cash flow internally.

4. Monitoring Points:

• Working capital trends and movement in current liabilities
• Changes in cash balances or access to external finance
• Profitability indicators in future accounts to assess operational viability
• Director or shareholder injections of funds or guarantees
• Timeliness and completeness of future filings to detect early signs of distress