TIDWORTH ELECTRICAL LIMITED

Executive Summary

Tidworth Electrical Limited is a start-up with limited financial history and modest net assets. The company’s liquidity is constrained by negative working capital and reliance on director loans, which raises short-term credit risk. Conditional approval is recommended with close monitoring of cash flow, working capital, and management’s ability to inject further funds or improve trading performance.

TIDWORTH ELECTRICAL LIMITED - Analysis Report

Company Number: 14374733

Analysis Date: 2025-07-20 18:56 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Tidworth Electrical Limited is a very young business incorporated in late 2022, with limited trading history and modest scale. The company’s net current liabilities of £21,482 and reliance on director loans (£47,076) highlight liquidity constraints and dependence on insider funding. While the net assets are positive (£10,114) due to fixed assets, the working capital deficit and absence of external debt or trade overdrafts present some short-term risk. The single director and 100% owner, Mr. Fleetwood, appears actively involved and financially committed, which is positive for management quality. Approval is recommended with conditions requiring close monitoring of cash flow and working capital improvement, and possibly personal guarantees given the small equity base and tight liquidity.

2. Financial Strength:
   The balance sheet shows fixed tangible assets of £31,596 consisting primarily of motor vehicles and plant & machinery, depreciated appropriately. Net assets are positive at £10,114, but the company has current liabilities exceeding current assets by £21,482, mainly driven by director loans and trade creditors. Shareholders’ funds are entirely equity-based with no external borrowings. The small scale and early stage mean limited financial buffer, and reliance on director loans indicates external financing has not been secured. Overall, the financial strength is weak but not unusual for a start-up SME in an asset-light service industry.

3. Cash Flow Assessment:
   Cash at bank is £9,562, which does not cover current liabilities of £52,254. Debtors amounting to £21,210 provide some short-term liquidity but may not be readily collectible. The negative net current assets position suggests working capital is insufficient to meet short-term obligations without further capital input or improved cash collection. The company’s cash flow is fragile and will require active management of receivables, payables, and possibly further director or external funding injections to remain solvent and meet loan repayments.

4. Monitoring Points:

• Liquidity trends: Monitor cash balances and debtor ageing monthly.
• Working capital improvement: Watch reductions in director loans and trade creditors.
• Profitability progression: Review future P&L accounts for positive earnings and retained profits.
• Director funding: Track any new loans or capital injections from the sole director.
• Filing compliance: Ensure timely submission of accounts and confirmation statements to avoid penalties or reputational risk.
• Business growth: Monitor contract wins and revenue increase to assess sustainability.