THE LOSS COLLECTIVE LTD

Executive Summary

THE LOSS COLLECTIVE LTD shows signs of financial strain with persistent negative net assets despite improved short-term liquidity. The company complies with filing requirements and benefits from a focused management team, but its limited operating history and small scale raise concerns about long-term sustainability. Further investigation into cash flow and business viability is recommended before considering investment.

THE LOSS COLLECTIVE LTD - Analysis Report

Company Number: 14502541

Analysis Date: 2025-07-29 12:49 UTC

1. Risk Rating: HIGH
   The company's financial statements reveal persistent negative net assets and shareholders' funds, indicating an ongoing equity deficit. Although there was an improvement in net current assets in the latest year, the overall solvency position remains weak. The company is relatively new, with limited operating history, which heightens risk due to lack of track record.

2. Key Concerns:

• Negative Net Assets: The company reported net liabilities of £590 as of November 2024, an improvement from prior years but still indicative of balance sheet weakness.
• Reliance on Accruals and Deferred Income: The presence of significant accruals/deferred income (£2,500) reduces available liquidity despite positive net current assets.
• Limited Operating History and Scale: Incorporated in late 2022, the company has only one employee and minimal fixed assets, suggesting limited operational scale and potential fragility in its business model.

3. Positive Indicators:

• Improved Working Capital Position: Net current assets improved from a negative £4,569 in 2023 to positive £1,611 in 2024, suggesting better short-term liquidity management.
• No Filing or Compliance Overdue: Both annual accounts and confirmation statements are filed on time, indicating good regulatory compliance.
• Clear Management Structure: Two experienced directors remain active, with a finance director and a clinical psychologist providing relevant expertise aligned with the company's health-related SIC classification.

4. Due Diligence Notes:

• Review detailed cash flow statements and sources of funding, to assess how liquidity is managed and whether there is reliance on director loans or external financing.
• Investigate the nature and sustainability of deferred income and accruals to understand revenue recognition and timing.
• Assess business plan and market positioning given the micro-entity scale and recent incorporation to evaluate operational viability and growth prospects.
• Confirm no director disqualifications or adverse conduct records beyond the data provided.