SP TECHNICAL SERVICES LTD

Executive Summary

SP Technical Services Ltd shows deteriorating financial health with worsening negative equity and insufficient liquidity to meet current liabilities. The company’s micro scale and lack of fixed assets limit creditworthiness. At this stage, credit facilities are not recommended without significant improvement in financial position and cash flow stability.

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Company Analysis

This analysis is opinion only and should not be interpreted as financial advice.

SP TECHNICAL SERVICES LTD - Analysis Report

Company Number: 12537829

Analysis Date: 2025-07-29 17:51 UTC

  1. Credit Opinion: DECLINE
    SP Technical Services Ltd presents several credit concerns. The company operates as a micro-entity with minimal turnover and no employees, indicating limited operational scale. The persistent negative net assets (shareholders’ funds) worsening from -£1,556 in 2023 to -£2,982 in 2024 reflect accumulated losses and deteriorating financial strength. Current liabilities exceed current assets by a significant margin, showing a negative working capital position when considering creditors after one year. The absence of fixed assets and negligible share capital (£1) limits collateral value. These factors combined suggest the company lacks sufficient financial resilience and capacity to service debt obligations reliably at this stage.

  2. Financial Strength:
    The balance sheet shows total current assets of £7,834 against current liabilities of £10,816, yielding net current liabilities of -£2,982 (contrary to the reported net current assets figure which appears inconsistent). Long-term creditors further strain the financial position. Negative shareholders’ funds indicate the company is insolvent on a balance sheet basis. There is no evidence of tangible or intangible fixed assets to support borrowing capacity. The company’s micro classification and zero employees highlight a very small operational footprint with limited financial buffer.

  3. Cash Flow Assessment:
    Limited current assets primarily comprise cash or receivables, but the current liabilities exceed these, suggesting potential liquidity challenges. No employee costs imply minimal overheads, but without detailed cash flow statements, it is difficult to confirm operational cash generation. However, the negative equity and increasing creditors suggest the company might be relying on creditor funding or director loans to sustain operations, which is not sustainable for external lending.

  4. Monitoring Points:

  • Watch for improvements in net assets and reversal of accumulated losses.
  • Monitor liquidity ratios closely, especially current ratio and quick ratio trends.
  • Review any changes in creditor terms or increases in director loans which could indicate cash flow stress.
  • Track turnover growth and diversification of income streams to improve operational sustainability.
  • Keep an eye on any changes in director appointments or control that might impact governance.

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