ST8 ELECTRICAL LTD

Executive Summary

ST8 Electrical Ltd is a newly established micro business with very limited financial history and a weak liquidity position. While the company’s fixed asset base supports its core operational activity, its negative working capital and minimal equity warrant a cautious credit approach. Conditional credit approval is recommended with close monitoring of cash flow improvements and timely financial updates.

ST8 ELECTRICAL LTD - Analysis Report

Company Number: 14851093

Analysis Date: 2025-07-29 14:12 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   ST8 Electrical Ltd is a newly incorporated micro-entity in the electrical installation sector with minimal trading history. The company shows a very modest net asset base (£255) and net current liabilities (£4,535), indicating constrained liquidity and working capital challenges. Given the early stage of operations and limited financial data, approval for credit is conditional upon ongoing monitoring of trading performance and cash flow improvement.

2. Financial Strength:
   The balance sheet reflects fixed assets of £14,500, likely representing essential equipment or tools, which supports operational capacity. However, current liabilities exceed current assets by £4,535, signaling short-term liquidity pressure. Total liabilities after one year (£9,710) further reduce net assets to a marginal £255, indicating a thin equity buffer. This limited financial strength implies vulnerability to unexpected expenses or revenue shortfalls.

3. Cash Flow Assessment:
   The net current liabilities position suggests ST8 Electrical Ltd may face challenges meeting short-term obligations without additional cash inflows or financing. With only one employee (the director) and small asset base, working capital management is critical. There is no evidence yet of positive cash reserves or retained earnings, so careful attention to cash collection, creditor terms, and cost control is advised for credit risk mitigation.

4. Monitoring Points:

• Improvement in net current assets and liquidity ratios over the next 12 months.
• Evidence of profitable trading and accumulation of reserves in forthcoming accounts.
• Timely filing of accounts and confirmation statements to ensure compliance.
• Stability and conduct of the sole director, who holds full control and financial responsibility.
• Any increase in fixed assets or borrowings that may impact gearing and repayment capacity.