Company Number: 13787195

Analysis Date: 2025-07-20 17:05 UTC

1. Credit Opinion: DECLINE
   Spectrum Pharma Ltd's financial profile raises concerns regarding its ability to meet credit obligations. The company’s net current assets have sharply deteriorated from £39,325 in 2021 to a marginal £251 in 2023, indicating a significant erosion of working capital. Such a thin liquidity buffer suggests limited capacity to absorb financial shocks or service debt. Additionally, the company is classified as micro-entity, with minimal asset base and only one employee, indicating limited operational scale and resilience. The director, who is also the sole significant controller, has no evident financial backing or diversification of control, concentrating risk. Without evidence of improved cash flows or asset growth, extending credit would be high risk.

2. Financial Strength:
   The balance sheet shows a drastic decline in current assets from £51,972 (2021) to £19,052 (2023), while current liabilities increased from £12,647 to £18,801 in the same period. Net assets have reduced from £39,325 to just £251. This erosion of equity indicates possible operating losses or withdrawals, undermining financial stability. The absence of fixed assets or other substantial holdings further limits collateral value. Overall, the company’s financial strength is weak and trending negatively.

3. Cash Flow Assessment:
   The minimal net current assets (£251) suggest very tight liquidity with little buffer to cover short-term liabilities. Without detailed cash flow statements, the reduction in current assets and increased current liabilities implies cash outflows exceeding inflows. Working capital is almost zero, which puts stress on day-to-day operations and raises concerns about the company’s ability to meet immediate obligations without external funding.

4. Monitoring Points:

• Quarterly review of current assets and liabilities to detect further deterioration
• Cash flow forecasts and actuals to assess liquidity trends
• Any changes in director or ownership structure that may impact control or financial support
• Timely submission of accounts and confirmation statements to monitor compliance
• Business performance indicators such as revenue growth or new contracts in the health activities sector (SIC 86900)