THE GFF CO. LTD

Executive Summary

THE GFF Co. Ltd is an early-stage micro-entity with a fragile financial position characterized by negative net assets and working capital deficits. The company currently relies heavily on director loans, lacks profitability data, and demonstrates limited capacity to service debt or credit facilities. Given these risks, credit approval should be declined until evidence of financial stabilization and sustainable cash flows emerges.

THE GFF CO. LTD - Analysis Report

Company Number: 15047548

Analysis Date: 2025-07-29 14:16 UTC

1. Credit Opinion: DECLINE The GFF Co. Ltd demonstrates significant financial weakness with net liabilities of £103,859 and negative working capital of £101,753 as at 31 August 2024. The company is in its first full financial year post-incorporation, showing reliance on director loans (£53,477 owed to directors) to support operations. The cash and current assets are insufficient to cover immediate liabilities, reflecting high liquidity risk. Without a proven track record of revenue generation or profitability and a negative net asset position, the company currently lacks the financial resilience to service debt or credit facilities reliably.

2. Financial Strength: The balance sheet shows minimal fixed assets (£1,608) and a micro-entity scale with only £2.33 of share capital. The substantial current liabilities (£234,862) exceed current assets (£129,740), resulting in negative net current assets and net liabilities. The company’s equity is negative, indicating accumulated losses or funding gaps typical of an early-stage business. The reliance on director financing highlights weak external capital and potential vulnerability to funding withdrawal.

3. Cash Flow Assessment: The company’s liquidity position is weak with a severe working capital deficit. Current liabilities nearly double current assets, suggesting significant short-term payment obligations that cannot be met from existing liquid resources. Without audited profit and loss data, cash flow from operations cannot be assessed, but the negative net assets and reliance on director loans imply cash flow insufficiency. This raises concerns over the ability to meet ongoing operational costs and service new credit.

4. Monitoring Points:

• Track subsequent filing of profit and loss accounts to assess revenue and profitability trends.
• Monitor changes in director loans and any new external funding sources.
• Watch for improvement in net current assets and net asset position in future accounts.
• Review the company’s ability to meet payment obligations on time, including creditor aging.
• Assess any changes in management or shareholder structure that might affect financial strategy.