SKYLINE AKH LIMITED

Executive Summary

SKYLINE AKH LIMITED is a newly formed micro-entity with substantial fixed assets funded by significant debt, resulting in a small negative net asset position. The company’s liquidity is constrained by a negative working capital position, raising concerns about short-term debt servicing. Conditional credit approval is recommended, with close monitoring of cash flow, debt servicing, and asset performance going forward.

SKYLINE AKH LIMITED - Analysis Report

Company Number: 14848612

Analysis Date: 2025-07-29 19:01 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   SKYLINE AKH LIMITED is a recently incorporated micro-entity operating in real estate letting. The company’s net asset position is slightly negative (£-1,648) due to long-term liabilities exceeding fixed assets by a small margin. This weak equity base and high long-term creditor balance (£357k) relative to fixed assets (£552k) raise concerns about financial leverage and debt servicing capacity at this early stage. However, the directors include a Chartered Accountant, suggesting strong financial oversight. Conditional approval is recommended, contingent on monitoring trading progress, cash flow improvements, and timely servicing of liabilities.

2. Financial Strength:
   The balance sheet shows fixed assets of £552,114, likely property-related given the SIC code, with very low current assets (£5,766) and significant current liabilities (£202,734) and long-term liabilities (£357,058). Net current liabilities stand at -£196,704, indicating working capital deficiency. The slight negative net assets and shareholders’ funds (-£1,648) reflect an initial investment phase with substantial borrowings. The company is highly leveraged, which is typical for real estate ventures but requires close scrutiny of asset values and creditor terms.

3. Cash Flow Assessment:
   Current assets are minimal, and current liabilities are substantial, creating a negative working capital position. This suggests liquidity risk and potential challenges in meeting short-term obligations without additional funding or operating cash inflows. With only 2 employees and no indication of revenue or profit figures, cash flow generation remains uncertain. The presence of a Chartered Accountant as director mitigates some operational risk but the company must demonstrate ability to generate sufficient cash or refinance debt to maintain solvency.

4. Monitoring Points:

• Timely servicing of both current and long-term liabilities to avoid default.
• Progress in generating rental income or other cash inflows from property assets.
• Changes in fixed asset valuations and any impairments.
• Working capital improvements and changes in current asset composition.
• Directors’ reports and accounts for next periods, especially cash flow statements and profit & loss data.
• Any changes in ownership or increases in equity capital.