Company Number: 13117156

Analysis Date: 2025-07-20 11:03 UTC

1. Risk Rating: MEDIUM
   The company shows a moderate risk profile. While it is active, compliant with filing deadlines, and reports positive net assets, there is a notable decline in net assets year-on-year and material intercompany balances written off. The working capital position appears adequate but some financial data suggest potential operational and solvency concerns that warrant closer scrutiny.

2. Key Concerns:

• Significant reduction in net assets from £307k (FY 2023) to £117k (FY 2024), indicating profit erosion or losses impacting shareholder equity.
• Large intercompany balances (£831k) written off in prior year adjustment, which may suggest prior intra-group financial issues or unrecoverable receivables affecting asset quality.
• Declining current assets and debtors year-on-year, potentially signaling reduced sales or collection challenges, despite a relatively strong cash balance.

3. Positive Indicators:

• The company is current with statutory filings, including accounts and confirmation statements, indicating sound compliance and governance practices.
• Cash balances have improved substantially from £5k to over £71k, supporting short-term liquidity needs.
• Low share capital but positive net assets and shareholders’ funds suggest retained earnings or reserves underpinning financial stability.
• Active website presence and operational status in a well-defined manufacturing SIC code (fabricated metal products) support business continuity.

4. Due Diligence Notes:

• Investigate the nature and cause of the prior year intercompany balance write-offs to understand potential related party risks or financial distress within group entities.
• Review profit and loss details (absent from abridged accounts) to assess revenue trends, cost structures, and profitability drivers over time.
• Examine debtor aging and credit control effectiveness given the sizable debtor balances relative to turnover and cash position.
• Confirm the impact of director changes, especially recent resignations and appointments, on operational continuity and management quality.
• Assess deferred tax liability disclosures and any contingent liabilities linked to provisions to evaluate hidden financial risks.