TIMEPLAN ESTATES LTD

Executive Summary

Timeplan Estates Ltd has shown significant asset growth and equity improvement over the last year, supported by increased investment property holdings financed through substantial new bank loans. However, the company exhibits liquidity strain with negative working capital and low cash balances, warranting conditional credit approval with close monitoring of cash flow and debt servicing capability. Financial oversight should focus on ensuring the company can meet its near-term obligations and maintain sustainable operations in the real estate letting sector.

TIMEPLAN ESTATES LTD - Analysis Report

Company Number: 13112002

Analysis Date: 2025-07-20 12:31 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Timeplan Estates Ltd shows a significant turnaround from negative net assets in 2023 to positive net assets in 2024, driven primarily by a large increase in investment properties and long-term bank loans. The company operates in real estate letting, a sector with moderate cyclicality but generally stable cash flow if properties are well let. However, the negative net current assets position and high short-term liabilities relative to current assets indicate liquidity pressure. Approval is recommended conditionally, subject to monitoring liquidity closely and ensuring the company can meet short-term obligations, especially given the substantial increase in borrowings.

2. Financial Strength:

• Fixed assets (investment properties) grew from £384k to £3.56m, reflecting major acquisitions or revaluations.
• Net assets improved from a deficit of £240k to a positive £343k, indicating a stronger equity base.
• Share capital is nominal (£1), so equity strength relies on retained earnings/profit.
• Long-term liabilities jumped from £353k to £2.73m, largely due to new bank loans, increasing gearing risk.
• Negative net current assets of £481k show working capital deficits, as current liabilities (£4.43m) exceed current assets (£3.95m).

3. Cash Flow Assessment:

• Cash on hand is low at £21.8k, sharply down from £250k the prior year, signaling tight liquidity.
• Debtors are modest (£265k) but increased from prior year, possibly linked to contract work or rent receivables; collection efficiency should be reviewed.
• Current liabilities are very high (£4.43m), including £2.47m of bank loans and significant trade and other creditors.
• Working capital management is a concern; the company must maintain strong cash inflows from property lettings or sales to cover short-term debts.

4. Monitoring Points:

• Liquidity ratios and working capital trends to ensure timely payment of short-term liabilities.
• Debt servicing capacity and covenant compliance on bank loans, especially given the large increase in borrowings.
• Rent or sales income stability and debtor collection periods.
• Any further capital expenditure or acquisitions that may impact cash flow.
• Director’s ongoing ability to manage financial risks and maintain compliance with filings (currently up to date).