STEM INNOVATION CONSULTANCY LTD
Executive Summary
STEM INNOVATION CONSULTANCY LTD is a financially stable micro-entity with improving net assets and strong working capital, supporting its ability to meet current obligations. The company’s modest scale and limited operational complexity warrant moderate credit exposure with routine monitoring of liquidity and profitability metrics. Overall, credit facilities can be extended with confidence, subject to ongoing review of financial performance and management continuity.
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This analysis is opinion only and should not be interpreted as financial advice.
STEM INNOVATION CONSULTANCY LTD - Analysis Report
Credit Opinion: APPROVE with caution. STEM INNOVATION CONSULTANCY LTD demonstrates a sound financial position for a micro-entity with positive net assets and good working capital. The company is active, compliant with filing deadlines, and shows steady growth in net assets. However, as a micro company with a single employee and modest fixed assets, the scale of operations is limited. Credit exposure should be moderate, reflecting the company's size and relative simplicity.
Financial Strength: The balance sheet reveals improving net assets, rising from £18,029 in 2021 to £84,239 in 2024, indicating retained earnings and capital accumulation. Fixed assets have decreased from the prior year but remain substantive at £50,676, suggesting investments in long-term resources. Current assets consistently exceed current liabilities, yielding strong net current assets (£71,031 in 2024), supporting short-term financial stability. The presence of long-term creditors (£26,468 in 2024) is manageable relative to net assets.
Cash Flow Assessment: Current assets of £79,464 against current liabilities of £8,433 show strong liquidity and an ample working capital buffer. The company maintains positive net current assets, indicating capacity to meet short-term obligations without stress. However, detailed cash flow statements are not available, and the single-employee operation suggests limited cash inflows and outflows. Monitoring cash conversion cycles and receivables management will be prudent.
Monitoring Points:
- Maintain vigilance on debtor collections and short-term creditor payments to preserve liquidity.
- Watch for any increase in long-term liabilities that might strain capital structure.
- Track profitability trends, as no profit and loss data were filed; profit generation is critical for ongoing debt servicing.
- Observe any changes in management or ownership that could impact governance or financial policies.
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