VCLOUD TECHNOLOGY LIMITED

Executive Summary

VCLOUD TECHNOLOGY LIMITED is currently in a weak financial position, with negative net assets and a working capital deficit, indicating limited capacity to meet short-term liabilities and service debt. The company’s liquidity is constrained by low cash and high debtor balances, raising concerns about cash flow reliability. Without operational improvements or capital support, extending credit facilities is not advisable at this time.

VCLOUD TECHNOLOGY LIMITED - Analysis Report

Company Number: 13191383

Analysis Date: 2025-07-20 12:11 UTC

1. Credit Opinion: DECLINE
   VCLOUD TECHNOLOGY LIMITED exhibits a weak financial position with net liabilities of £1,497 at the 2024 year end, a reversal from net assets of £1,191 in 2023. The negative shareholders’ funds and working capital deficit indicate an inability to comfortably meet short-term obligations. The company’s capital structure is thin, with only £150 in share capital, showing minimal buffer for losses. Additionally, the company is relatively new (incorporated 2021), with limited operational history to demonstrate consistent profitability or growth. These factors suggest increased credit risk and limited capacity to service new or existing debt facilities without additional capital injection or operational improvement.

2. Financial Strength:
   The company’s balance sheet shows current assets of £35,342 mainly comprising debtors (£34,200) and a low cash balance (£1,142), offset by current liabilities of £36,839. The 2024 figures reveal a stock write-down to zero from £5,967 in 2023. The large proportion of debtors to total current assets signals potential collection risk and possible cash flow strain. Shareholders’ funds have declined from positive £1,181 to negative £1,497, reflecting accumulated losses. Overall, the financial strength is fragile with net liabilities and erosion of equity, signaling undercapitalization and weak solvency.

3. Cash Flow Assessment:
   Cash at bank is minimal (£1,142), and net current liabilities of £1,497 indicate a working capital deficit. A high level of debtors relative to cash suggests potential liquidity issues if collections are delayed. The company’s cash conversion cycle may be elongated, increasing short-term funding risk. The increase in creditors from £8,281 in 2023 to £36,839 in 2024 is significant and likely reflects capital grants or other payables, but this also pressures liquidity. Without sufficient cash reserves or access to credit, liquidity risk is elevated.

4. Monitoring Points:

• Monitor debtor collection efficiency and aging to assess realisable cash flow.
• Watch for further deterioration or improvement in working capital and shareholders’ funds.
• Track any capital injections or changes in share capital that could improve solvency.
• Observe operational performance and turnover trends in future filings to gauge business viability.
• Review director appointments and changes for signs of management stability or risk.