Company Number: 14251379

Analysis Date: 2025-07-29 20:03 UTC

1. Risk Rating: MEDIUM

The company shows positive net current assets and shareholders’ funds, indicating solvency at the balance sheet date. However, the substantial increase in current liabilities relative to current assets in the latest year, coupled with a significant drop in cash reserves, raises liquidity concerns that merit caution.

2. Key Concerns:

• Sharp Increase in Current Liabilities: Current liabilities increased from approximately £193k in 2023 to £651k in 2024, over threefold, potentially stressing short-term obligations.
• Significant Cash Reduction: Cash at bank decreased dramatically from £269k to £30k, which could impair the company’s ability to meet immediate expenses despite high debtors.
• Elevated Trade Creditors: Trade creditors ballooned from £44k to £574k, indicating possible delayed payments to suppliers or stretched payables, which might affect supplier relations and operational stability.

3. Positive Indicators:

• Positive Net Current Assets: £267k net current assets suggest working capital sufficiency despite increased liabilities.
• Shareholders’ Funds Stable: Equity is relatively stable (£299k vs £304k), implying no immediate erosion of capital base.
• Growing Debtors and Stock: Debtors rose significantly (£39k to £283k) alongside stock increase (£185k to £606k), which may indicate expanding sales or inventory build-up for demand.

4. Due Diligence Notes:

• Investigate nature and terms of increased current liabilities, particularly trade creditors, to assess if payable timing is sustainable.
• Review debtor quality and aging to confirm collectability and cash flow projections.
• Assess reasons behind steep cash decrease—whether due to capex, financing, or operational cash burn.
• Confirm absence of any contingent liabilities or pending litigation that could impact financial health.
• Validate governance and director changes given recent resignations and appointments, ensuring continuity and control.