SPACE NETWORK LTD

Executive Summary

SPACE NETWORK LTD’s latest accounts reveal a significant deterioration in financial health, with a sharp decline to negative net assets and working capital deficits. This raises concerns about liquidity and the company’s ability to meet its obligations, warranting a credit decline at present. Close monitoring of cash flow and liabilities is recommended should the company seek future credit facilities.

SPACE NETWORK LTD - Analysis Report

Company Number: SC656651

Analysis Date: 2025-07-29 12:07 UTC

1. Credit Opinion: DECLINE
   SPACE NETWORK LTD shows a concerning deterioration in its financial position over the latest accounting period. The company reported net assets of £1,819 in 2023 turning sharply negative to -£15,419 in 2024, primarily due to significant increases in current liabilities and a new £4,000 creditor due after one year. This negative equity position and worsening working capital indicate a strained liquidity profile and increased risk of default on obligations. Given these factors and the micro-entity status with limited financial disclosures, the company currently lacks the financial strength to reliably service new credit facilities.

2. Financial Strength: Weakening
   The company’s fixed assets remain minimal and stable (£3,961 in 2024) reflecting limited capital investment. However, current liabilities have risen substantially from £21,390 to £32,322, while current assets decreased slightly. The net current assets moved from a positive £3,003 in 2023 to a negative £15,380 in 2024, indicating working capital deficiency. Total assets less current liabilities swung from a positive £1,819 to a negative £11,419. The introduction of £4,000 in longer-term liabilities further stresses solvency. Overall, the balance sheet shows a declining financial position with net liabilities eroding shareholders’ funds.

3. Cash Flow Assessment: Constrained
   The negative net current assets highlight insufficient short-term liquidity to meet immediate obligations. Although exact cash flow statements are not provided, the growing current liabilities and reduced current assets strongly suggest cash flow challenges. The company’s limited asset base and small employee count (3) imply limited operational scale, which may constrain cash generation capacity. The absence of audit and reliance on micro-entity reporting standards limit insight into cash flow but the working capital deficit is a key red flag for liquidity risk.

4. Monitoring Points:

• Quarterly monitoring of current liabilities and cash balances to detect worsening liquidity.
• Watch for any further increase in debt or creditor aging beyond 1 year.
• Review of management actions to restore working capital and profitability.
• Scrutiny of director conduct and business performance given sole controlling shareholder/director status.