SG UTILITIES SERVICES LIMITED

Executive Summary

SG Utilities Services Limited has shown a marked improvement in financial position over the past year, moving from negative equity to positive net assets driven by increased receivables and improved working capital. While liquidity remains tight with low cash balances and significant tax obligations, the company has maintained compliance with filings and shows potential to service credit facilities if debtor collections are controlled. Credit approval is recommended with conditions focusing on cash flow monitoring and tax liability management.

SG UTILITIES SERVICES LIMITED - Analysis Report

Company Number: 13478752

Analysis Date: 2025-07-29 15:53 UTC

1. Credit Opinion: CONDITIONAL APPROVAL SG Utilities Services Limited demonstrates a significant turnaround in financial position in the latest year, moving from negative net assets to positive net assets of £24,284. The company is active, with no overdue filings and a single director who is also the sole significant controller. However, the financials show reliance on director advances and tax liabilities that have shifted from short-term to long-term, indicating potential cash flow timing issues. Approval is recommended with conditions focused on obtaining further financial information on cash flow forecasts and mitigating risks related to tax liabilities and working capital management.

2. Financial Strength:

• The company has improved from net liabilities of £193 in the prior year to net assets of £24,284 in the current year, reflecting growth and better balance sheet health.
• Current assets increased sharply to £13,693 driven primarily by debtors (£11,959), indicating significant amounts owed to the company.
• Current liabilities are reported at a negative figure (£-13,477), which likely reflects accounting presentation related to tax liabilities (notably a large tax creditor and a deferred tax creditor of £2,886 due after one year).
• Shareholders’ funds have moved from a deficit to a positive equity position of £24,283, indicating restored capital.
• The company carries minimal fixed assets, consistent with its utility construction focus, and has a very low share capital (£1).

3. Cash Flow Assessment:

• Cash on hand is low at £1,734 but improved from £362 the previous year, showing better liquidity but still limited.
• Debtors form the bulk of current assets and represent potential future cash inflows, but collection risk should be monitored carefully.
• The large tax liabilities (current and deferred) suggest cash flow outflows in the near and medium term that must be managed prudently.
• Net current assets are positive at £27,170, indicating working capital adequacy at the balance sheet date.
• Given the company is a single-director SME in a specialized construction niche, cash flow volatility is a concern especially if contract payments are delayed or disputes arise.

4. Monitoring Points:

• Timely collection of trade debtors to ensure liquidity is maintained.
• Management of tax liabilities and confirmation on payment plans or deferrals with HMRC.
• Continued monitoring of net current asset position and cash balances quarterly.
• Watch for any changes in director advances or related party transactions that may affect liquidity.
• Review of contract pipeline and revenue recognition policies given the nature of utility construction projects.