Company Number: 14548248

Analysis Date: 2025-07-19 13:05 UTC

1. Risk Rating: LOW
   Justification: Spellbrook Electrical Ltd has demonstrated positive profitability and maintains strong net current assets relative to its liabilities in its first full year of trading. The company is active, up to date with filings, and shows no signs of financial distress or governance issues.

2. Key Concerns:

• Limited Operating History: Incorporated in late 2022, the company has only one full trading year of financial data, which limits the ability to assess long-term stability.
• Modest Turnover Level: Turnover of £74,300 is low, potentially reflecting a small scale of operations with limited revenue diversification.
• Director Concentration: Both directors are also significant controllers, which may limit independent oversight or governance checks.

3. Positive Indicators:

• Profitability: The company reported a healthy operating profit of £31,993 and net profit after tax of £25,897 in 2024, indicating operational viability.
• Strong Liquidity: Cash reserves of £34,221 comfortably cover current liabilities of £10,722, resulting in net current assets of £23,499, suggesting good short-term financial health.
• Compliance: Filing of accounts and confirmation statements are current, with no overdue returns or indications of regulatory non-compliance.
• Clear Governance: Directors have declared their responsibilities, and there are no reported disqualifications or governance irregularities.

4. Due Diligence Notes:

• Verify the nature of directors' remuneration and related party transactions, especially given the director's current account creditor balance.
• Assess the sustainability of revenue growth beyond the initial trading year and inquire about client concentration risk.
• Confirm the absence of any contingent liabilities or off-balance sheet exposures not disclosed in the accounts.
• Review the directors' assumptions supporting the going concern basis, considering limited operational history.