THEENEMY LTD

Executive Summary

THEENEMY LTD exhibits severe financial distress with negative net assets and worsening liquidity, undermining its ability to service credit facilities. The company’s current financial trajectory and working capital position do not support additional lending without significant mitigation. Close monitoring of cash flow and management actions is essential before reconsidering credit exposure.

THEENEMY LTD - Analysis Report

Company Number: 13969882

Analysis Date: 2025-07-29 19:25 UTC

1. Credit Opinion:
   DECLINE. The company’s latest financials show a significant deterioration in liquidity and solvency. Net current liabilities have increased dramatically from £129,677 in 2022 to £362,314 in 2023, indicating worsening short-term financial stress. Total net assets have shifted from a positive £136,617 to a negative £656,609, reflecting accumulated losses or increased liabilities that exceed assets. This level of negative equity and poor working capital signals an inability to comfortably meet debt obligations or absorb financial shocks, making credit extension too risky at this stage.

2. Financial Strength:
   THEENEMY LTD is a micro-entity engaged in manufacturing luggage and accessories, with only one employee and a single director who is also the sole shareholder. Fixed assets remain stable around £328k, but current assets are minimal (£10,691). Current liabilities have nearly tripled within one year, and the company carries significant deferred income and accruals totaling over £600k. The erosion of shareholder funds from positive to deeply negative reflects ongoing losses or increased liabilities. The balance sheet is weak with net liabilities exceeding half a million pounds, indicating poor solvency and financial distress.

3. Cash Flow Assessment:
   Current assets are insufficient to cover current liabilities, resulting in negative net working capital of £362,314. This suggests liquidity problems and potential difficulty in meeting short-term obligations. The company’s cash or liquid assets are minimal, and the large deferred income figure may indicate advanced payments or unearned revenue that could mask true cash flow constraints. With only one employee and minimal operating scale, cash generation capacity appears limited. Without additional capital injection or improved cash flow, the company’s ability to service debt or supplier payments is compromised.

4. Monitoring Points:

• Monitor quarterly cash flow statements and bank balances closely to assess liquidity trends.
• Watch for changes in deferred income and accruals to understand underlying obligations.
• Track any capital injections or shareholder loans that may improve solvency.
• Review upcoming filings and management commentary for turnaround plans or restructuring efforts.
• Assess director’s continued involvement and any changes in control or business strategy.