Company Number: 12772167

Analysis Date: 2025-07-29 16:41 UTC

1. Risk Rating: MEDIUM

Justification: The Forbidden Fruit Bar Ltd shows signs of operational growth with increasing turnover and modest profitability in the latest year. However, the company has persistent negative net assets, indicating accumulated losses and balance sheet weakness. Current liabilities are significant, and long-term creditors weigh heavily on net assets. While filings are up to date and no regulatory issues are evident, financial leverage and modest profitability warrant caution.

2. Key Concerns:

• Negative Net Assets: The company has reported net liabilities of £855 at the latest year-end, improving from a larger deficit prior years but still negative, suggesting balance sheet fragility.
• Long-Term Creditors: Creditors due after one year total £60,500, a substantial liability relative to total assets, posing solvency risk if cash flows weaken.
• Thin Profit Margins: The profit for the year is only £727 on a turnover of £323,702, indicating limited profitability and potential vulnerability to cost fluctuations or revenue downturns.

3. Positive Indicators:

• Growing Turnover: Revenue nearly tripled from £117k to £324k in the latest year, demonstrating operational growth and market traction.
• Positive Net Current Assets: The company maintains a positive working capital position (£16,750), supporting short-term liquidity.
• Compliance: All statutory accounts and confirmation statements are timely filed with no overdue filings or apparent governance issues.

4. Due Diligence Notes:

• Clarify the nature and terms of the £60,500 long-term creditors to assess repayment risk and impact on solvency.
• Review detailed cash flow statements or bank statements (not provided) to verify liquidity beyond balance sheet metrics.
• Investigate the cause of historical accumulated losses and the sustainability of recent profitability.
• Assess director background and any related party transactions given overlapping directorships and shareholdings.