Company Number: 12997705

Analysis Date: 2025-07-20 14:28 UTC

1. Credit Opinion: DECLINE
   Studio 120 Limited presents a weak credit profile with negative net assets and net current liabilities as of the latest financial year ending November 2024. The company shows a working capital deficit of £4,333 and total net liabilities of £2,093, indicating balance sheet insolvency. The absence of significant cash reserves (£1,250) against current liabilities (£5,583) raises concerns about its ability to meet short-term obligations. Given the negative equity and lack of profitability data (income statement not filed), there is insufficient evidence of sustainable cash generation or financial stability to support credit extension.

2. Financial Strength:
   The company is small and very recently incorporated (2020), operating in the hairdressing and beauty treatment sector (SIC 96020) with only one employee (the director). Fixed assets are minimal (£2,240 net book value), and the equity base is negative at £(2,094). The company’s balance sheet is undercapitalised with accumulated losses reflected in retained earnings. This weak capital base limits financial resilience and ability to absorb shocks or sustain growth without additional capital injection.

3. Cash Flow Assessment:
   Cash on hand is very low at £1,250 relative to current liabilities of £5,583, resulting in a negative net current asset position. This indicates potential liquidity stress and difficulty in meeting near-term payables. Without detailed profit and loss or cash flow statements, it is unclear if the business generates positive operating cash flows; however, the negative working capital suggests ongoing cash flow constraints. The company’s reliance on trade creditors to finance operations is a risk factor.

4. Monitoring Points:

• Monitor future filings for profitability and cash flow generation to assess improvement in liquidity.
• Watch for any capital injections or shareholder loans that may strengthen equity and liquidity.
• Track timely payment of trade creditors to avoid supplier relationship deterioration.
• Review director’s strategic plans or external financing arrangements for business turnaround or growth initiatives.