TEXPLAIN LTD

Executive Summary

Texplain Ltd is a newly established micro-entity with a strong initial financial foundation, demonstrating good liquidity and zero debt. The company is well-managed, with timely compliance and a clear ownership structure. Given the current financial position, the company is suitable for credit approval with routine monitoring of operational and financial performance as trading develops.

TEXPLAIN LTD - Analysis Report

Company Number: 14780579

Analysis Date: 2025-07-20 16:06 UTC

1. Credit Opinion: APPROVE
   Texplain Ltd is a recently incorporated micro-entity with a solid opening financial position. The company has net assets of £28,261 and positive working capital of £25,018, indicating sufficient short-term liquidity to meet current obligations. The sole director and 75-100% shareholder, Daniel Barnett, appears to have full control and is managing the company responsibly, as evidenced by timely filings and compliance with statutory requirements. While the company is young and small, the financials show no signs of distress or over-leverage, supporting an approval for credit facilities with standard monitoring.

2. Financial Strength:
   The balance sheet is healthy for a micro-entity in its first 13-month period. Fixed assets are minimal at £3,242, appropriate for an artistic creation business (SIC 90030). Current assets of £47,085 exceed current liabilities of £22,066 by a comfortable margin, resulting in net current assets of £25,018. The equity base (£28,261) entirely funds the company's net assets, indicating no external debt and a clean capital structure. This low leverage reduces financial risk.

3. Cash Flow Assessment:
   Current assets primarily represent cash or near-cash items sufficient to cover current liabilities. The lack of debt obligations and positive working capital suggest the company has good liquidity and working capital management. The average headcount of 2 employees indicates a lean cost structure. There is no indication of cash flow stress or reliance on external financing to meet short-term needs.

4. Monitoring Points:

• Track growth in turnover and profitability once trading data becomes available to assess repayment capacity on any extended credit.
• Monitor working capital trends to ensure liquidity remains positive as the company scales.
• Review any new borrowings or changes in capital structure that might affect leverage.
• Keep oversight on director conduct and compliance filings to maintain governance standards.
• Watch for any material shifts in the artistic creation market that could impact revenue stability.