Company Number: 12391651

Analysis Date: 2025-07-20 11:33 UTC

1. Credit Opinion: DECLINE
   Black Bourn Vineyards Limited shows significant financial distress with persistent negative net assets and negative working capital over multiple years. Current liabilities of £247k greatly exceed current assets of £18k, indicating poor liquidity and an inability to meet short-term obligations from operational cash flows. The company relies heavily on interest-free loans from a related party (Proteus Investments Limited), which is the main creditor and has committed to ongoing support. This indicates a weak independent cash flow generation and high financial risk. Without evidence of a turnaround or improved cash flow, the risk of default is elevated, making credit approval unsuitable at this time.

2. Financial Strength:
   The balance sheet reveals net liabilities of £80k as at 30 June 2024, worsening from £65k the prior year, and a consistent pattern of shareholder deficit since inception. Fixed assets are £149k but heavily offset by current liabilities of £247k, resulting in a net current liability position of £230k. The company holds negligible share capital (£1), reflecting minimal equity buffer. The reliance on related party loans to fund operations and the lack of other equity injections undermine financial strength. The company is classified as a small private limited entity in the mixed farming sector, with no employees reported, which may limit operational capacity and revenue generation.

3. Cash Flow Assessment:
   Cash balances remain low (£16k) relative to current liabilities, evidencing constrained liquidity. Debtors have significantly decreased from £28k in 2020 to £1.5k in 2024, suggesting limited incoming cash from trade receivables. The company’s working capital is deeply negative and deteriorating, indicating ongoing cash flow challenges. The interest-free related party loans are repayable on demand, creating potential liquidity risk if support is withdrawn. There is no indication of operational profitability or positive cash flow from trading activities in the accounts, as the Profit and Loss statement is not filed but losses are implied by negative reserves.

4. Monitoring Points:

• Watch for improvements in net current assets and liquidity ratios to assess if working capital management improves.
• Monitor the level and terms of related party loans and any changes in support from Proteus Investments Limited.
• Track any filings of profit and loss accounts or management accounts for signs of operational cash flow improvements.
• Review any changes in business strategy, cost structure, or capital injections that could stabilize the financial position.
• Observe director conduct and company status filings for signs of distress or insolvency procedures.