ULTIMOTIVE HOLDINGS LIMITED

Executive Summary

Ultimotive Holdings Limited is a small, asset-backed company showing improved net equity but currently facing significant liquidity constraints due to high short-term liabilities versus minimal current assets. Credit approval is recommended on a conditional basis with emphasis on monitoring liquidity and profitability metrics and enforcing financial reporting discipline. The company’s financial trajectory appears positive but fragile, requiring careful oversight to mitigate risk.

ULTIMOTIVE HOLDINGS LIMITED - Analysis Report

Company Number: 13549233

Analysis Date: 2025-07-29 15:53 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Ultimotive Holdings Limited shows moderate improvement in net assets from £135.9k (2022) to £409.0k (2023), indicating strengthening equity. However, the company exhibits significant current liabilities (£787k) far exceeding current assets (£25k), resulting in a large net current liability position (~£763k). The high short-term liabilities relative to liquid assets pose liquidity risk. Given the micro-entity status with limited disclosure, the absence of a profit and loss account, and the small workforce (2 employees), credit exposure should be cautiously limited and closely monitored. Approval is recommended with conditions including covenant protections, regular financial updates, and limits on exposure.

2. Financial Strength:
   The balance sheet is asset-heavy with £1.44M in fixed assets, which are stable over the past two years. The company’s net assets have increased threefold in the latest period, driven by reduced long-term liabilities (from £508k to £272k). However, the large current liabilities compared to minimal current assets indicate weak short-term financial flexibility. Shareholders’ funds are positive and improving, reflecting retained earnings or capital injections, but working capital is negative and could impede operational agility or debt servicing under stress.

3. Cash Flow Assessment:
   Current assets are insufficient to cover current liabilities, resulting in a negative working capital position. This raises concerns about the company's ability to meet short-term obligations without refinancing or asset liquidation. The lack of detailed cash flow or profit figures limits full assessment, but the liquidity gap suggests reliance on fixed assets or external funding to cover operating needs, which is less ideal. Monitoring cash flow generation and receivables/payables cycles will be critical.

4. Monitoring Points:

• Liquidity ratios: Current ratio and quick ratio should be tracked to detect further deterioration or improvement.
• Debt structure: Monitor repayment schedules and any refinancing needs, especially of creditors falling due within one year.
• Profitability trends: Obtain profit and loss data to assess operating performance and ability to generate internal cash flow.
• Directors’ conduct and governance: Both directors hold significant control with no adverse conduct records noted. Ensure ongoing management stability and transparency.
• Covenant compliance and financial reporting timeliness for early warning of distress.