THE BROW TEC LTD

Executive Summary

The Brow Tec Ltd is a small, micro-sized beauty treatment company with a modest positive working capital and minimal equity base. Liquidity has improved recently, supported by director advances, but the company remains financially fragile due to its scale and limited financial reserves. Conditional credit approval is recommended with strict limits and ongoing monitoring of cash flow and debtor management.

THE BROW TEC LTD - Analysis Report

Company Number: 13002574

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

1. Credit Opinion: CONDITIONAL APPROVAL
   The Brow Tec Ltd is a micro-sized private limited company operating in the hairdressing and beauty treatment sector. The company shows modest net current assets and positive shareholders' funds but on a very small scale. The business is active and compliant with filings, with no overdue accounts or returns. However, the scale of operations and financial resources are limited, posing some risk in terms of liquidity and resilience. Approval may be granted with conditions such as limits on credit exposure and periodic financial monitoring.

2. Financial Strength:

• The balance sheet shows total current assets of £2,542 (including £1,045 in cash) against current liabilities of £2,358 at 30 April 2024, resulting in a small positive net current asset position of £184.
• Shareholders’ funds stand at £184, indicating a minimal equity base.
• There is no long-term debt, and the company is free from formal insolvency proceedings.
• The director has historically provided short-term advances but repaid the loan by December 2024, reflecting some level of financial support from management.
• The company’s financial scale is extremely small, with share capital of only £1 and minimal retained earnings.

3. Cash Flow Assessment:

• Cash on hand increased significantly from £180 in 2023 to £1,045 in 2024, improving liquidity.
• Debtors have decreased from £2,317 to £1,497, which may suggest improved collections but also reduced sales or outstanding work.
• Current liabilities have slightly increased but remain manageable relative to current assets.
• The small positive net working capital and cash position indicate the company can meet short-term obligations but with limited buffer.
• The business depends heavily on the director’s financial support and prudent cash management.

4. Monitoring Points:

• Regular review of cash flow forecasts and working capital to ensure ongoing liquidity.
• Monitoring of debtor days and collections performance given the relatively high level of trade receivables.
• Close watch on any increases in liabilities or delayed payments to suppliers.
• Assessment of revenue growth or contraction since the latest accounts to understand business trajectory.
• Continued evaluation of director involvement and any financial support or guarantees.
• Watch for any changes in industry conditions impacting the beauty treatment sector.