SC DESIGN HOUSE LIMITED
Executive Summary
SC DESIGN HOUSE LIMITED is a micro architectural services company with minimal turnover and sustained operating losses, resulting in weak financial strength and constrained liquidity. The current financial trajectory and lack of profitability make the company a high credit risk with limited capacity to service debt. Credit facilities are not recommended unless significant business improvement and cash flow generation can be demonstrated.
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This analysis is opinion only and should not be interpreted as financial advice.
SC DESIGN HOUSE LIMITED - Analysis Report
Credit Opinion: DECLINE
SC DESIGN HOUSE LIMITED demonstrates a weak financial profile with recurring losses and very low turnover (£1,000 in 2024, down from £3,800 the previous year). The company is a micro entity with minimal scale and limited trading history (incorporated 2021). Losses increased to £6,372 in the latest period, indicating poor profitability and limited ability to generate cash flow to service debt or credit facilities. The absence of any current liabilities suggests the company has not utilized trade credit, but this also means no indication of managing external payables. Overall, the risk of default or inability to repay loans is high.Financial Strength:
The balance sheet shows net assets of £3,172 as of January 2024, up from £2,017 in 2023, primarily due to increased current assets (£1,173 vs £18). Fixed assets remain steady at £1,999. The company's net current assets improved, but this is from a very low base and reflects minimal operational scale. Shareholders' funds equal net assets and show some capital support from owners. However, the recurring operating losses and minimal turnover highlight the fragile financial footing and limited buffer to absorb shocks.Cash Flow Assessment:
Current assets mainly consist of £1,173 in short-term assets, but the company’s turnover and profitability are insufficient to generate positive cash flows internally. The absence of current liabilities indicates no working capital financing from suppliers or creditors, which could constrain liquidity. With ongoing losses and low revenue, the company likely relies on external funding or owner capital injections to meet obligations. Liquidity appears weak and insufficient for additional credit without a clear turnaround plan.Monitoring Points:
- Turnover growth and ability to increase sales sustainably
- Profitability improvement and reduction of operating losses
- Cash flow from operations and liquidity position (current assets vs liabilities)
- Any new external financing or owner capital injections
- Changes in asset base or liabilities that might affect solvency and working capital
- Director’s strategy for business growth and risk mitigation
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