Company Number: 15055539

Analysis Date: 2025-07-20 13:29 UTC

1. Credit Opinion: DECLINE
   SHJ Recycling Ltd shows significant financial distress with net liabilities of £19,624 just over one year since incorporation. The large negative working capital (£80,104) indicates an inability to meet short-term obligations. The absence of employees and minimal current assets (£821) further limit operational capacity and cash inflows. Without evidence of external funding or profit generation, the company’s capability to service debt or sustain credit facilities is weak. The director is the sole controller, but no track record or financial strength is demonstrated to mitigate risk.

2. Financial Strength:
   The balance sheet is fragile. Fixed assets of £60,680 are outweighed by current liabilities of £80,925, resulting in a net current liability position of £80,104. Total net assets and shareholders’ funds are negative at £19,624, indicating insolvency on a balance sheet basis. The company has no retained earnings or reserves and is operating at a loss. The micro-entity status means limited disclosure, but the net liability position raises solvency concerns.

3. Cash Flow Assessment:
   Current assets consist almost entirely of minimal cash or equivalents (£821) with no inventory or receivables. Current liabilities are substantial, suggesting potential liquidity strain. Negative net current assets imply that the company cannot cover short-term debts from its liquid resources, exposing it to default risk. The absence of employees suggests no payroll burden but also limited operational activity generating cash flow.

4. Monitoring Points:

• Improvement in net current assets and liquidity ratios.
• Evidence of revenue generation and profitability in future filings.
• Changes in capital structure or external funding to improve solvency.
• Director’s actions to reduce liabilities or increase assets.
• Timely filing of accounts and confirmation statements as indicators of compliance and governance.