SMARTHOME TECH LIMITED

Executive Summary

Smarthome Tech Limited is a financially stable micro-entity with improving net assets and strong liquidity, indicating good capacity to meet its short-term obligations. The company shows prudent financial management and no immediate credit concerns, though related-party loans should be regularly reviewed. Continued monitoring of working capital and compliance filings is recommended to maintain a positive credit profile.

SMARTHOME TECH LIMITED - Analysis Report

Company Number: 12992548

Analysis Date: 2025-07-20 14:39 UTC

1. Credit Opinion: APPROVE. Smarthome Tech Limited demonstrates a positive financial trajectory with growing net assets and working capital. The company maintains a healthy liquidity position and shows an ability to meet short-term obligations as current assets exceed current liabilities by a substantial margin in the latest year. No adverse director conduct or overdue filings are noted. However, director advances of £28,118 represent related-party exposure that should be monitored for potential impact on cash flow.

2. Financial Strength: The balance sheet indicates steady growth over recent years. Net assets increased from £12,720 in 2020 to £41,951 in 2024, more than tripling, primarily driven by improvements in net current assets which rose from £9,187 to £27,535. Fixed assets decreased slightly in 2024 but remain modest relative to total assets, reflecting a business model likely dependent on current assets and operational cash flow. Shareholders’ funds mirror net assets, showing retained profits supporting capital base.

3. Cash Flow Assessment: Current assets of £68,847 comfortably cover current liabilities of £41,312, resulting in a strong net working capital of £27,535, indicating sufficient short-term liquidity to service debts and operational expenses. The average employee count (2) suggests a lean cost structure. However, the director's loan balance of £28,118 should be scrutinized as it may constrain available cash or represent a potential liability if repayment is demanded.

4. Monitoring Points:

• Director loan account balance and its terms—ensure it does not impair liquidity.
• Continued growth in net current assets and net assets to sustain creditworthiness.
• Timely filing of annual returns and accounts to avoid compliance risk.
• Operational cash flow trends once profit and loss data become available.
• Industry risks related to electrical installation services and potential market volatility.