Company Number: 15411419

Analysis Date: 2025-07-29 20:02 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Six Elements Fitness Ltd is a newly incorporated private limited company (January 2024) operating in the fitness facilities sector. The company’s first set of accounts shows a modest equity base (£2,059) with net current liabilities of £10,239 due to current liabilities significantly exceeding current assets. The negative working capital position highlights potential short-term liquidity challenges. However, the fixed assets of £12,298 indicate some investment in plant and machinery, supporting operational capacity. Given the company’s early stage, limited trading history, and current liquidity strain, credit approval is conditional on monitoring cash flow closely and possibly requiring security or personal guarantees from the director, Mr. Robert Paul Humphreys, who holds full ownership and control.

2. Financial Strength:
   The balance sheet reveals a total asset base of approximately £14,557 (fixed assets plus current assets), offset by current liabilities of £14,398, leading to a small positive net asset position (£2,059). The company has no long-term liabilities reported. The absence of retained earnings beyond the initial period and the negative net current assets suggest limited buffer to absorb operational shocks or unexpected expenses. The company’s financial strength is currently weak but not critical, typical for a new start-up with initial capital invested mainly in fixed assets rather than cash reserves.

3. Cash Flow Assessment:
   Cash on hand is low (£1,659), which combined with current liabilities of £14,398, indicates a liquidity gap that could impair the company’s ability to meet short-term obligations without additional financing or improved collections from debtors (£2,500). The working capital deficit of £10,239 is a red flag for cash flow management. The company must demonstrate effective cash inflows from operations or additional capital injections to sustain operations and service any credit extended. Close attention to debtor collection and creditor payment terms will be essential.

4. Monitoring Points:

• Liquidity ratios including current ratio and quick ratio on subsequent accounts
• Cash flow from operations and timing of debtor collections
• Changes in creditor balances and payment behavior
• Evidence of additional capital injections or financing support
• Profitability indicators as trading history develops
• Director’s ongoing financial commitment and any personal guarantees or security provided