Company Number: 13060177

Analysis Date: 2025-07-29 15:03 UTC

1. Credit Opinion: APPROVE with conditions. Stem Solutions Group Ltd is a small private limited company operating in employment placement services. It shows a positive net current asset position and shareholders’ funds, indicating a solvent position able to meet short-term obligations. However, absence of audited financials and lack of income statement disclosure limit insight into profitability and cash generation. Conditions include periodic review of updated financials and monitoring trade debtor collections.

2. Financial Strength: The balance sheet as of 31 December 2023 reflects total net assets of £80,146, with net current assets of £77,434 supported by a cash balance of £101,619. Fixed assets are low (£2,712), consistent with a service business model and limited capital expenditure. Current liabilities decreased from £76,751 in 2022 to £43,221 in 2023, improving liquidity ratios. Share capital is nominal (£2), but retained earnings provide the bulk of equity, evidencing accumulated reserves.

3. Cash Flow Assessment: The company holds strong cash reserves relative to current liabilities, indicating good liquidity (cash covers current liabilities over 2 times). Debtors reduced significantly from £43,519 in 2022 to £19,036 in 2023, suggesting improved collection or lower sales on credit terms. Working capital remains solid at £77,434. However, without access to profit and loss or cash flow statements, cash flow from operations cannot be fully assessed, warranting caution.

4. Monitoring Points:

• Obtain and review full income statement and cash flow data when available to assess profitability and operating cash flows.
• Monitor debtor aging and credit risk concentration to ensure receivables remain collectible.
• Watch for any increase in short-term liabilities that could pressure liquidity.
• Track any changes in director or shareholder control and any late filing of statutory returns.
• Review impact of industry or economic changes on employment placement demand.