VERSATILE DISTRIBUTION LTD

Executive Summary

Versatile Distribution Ltd has demonstrated a financial turnaround with positive net assets in the latest year, improving solvency and liquidity metrics. However, the company’s prior negative equity position, elimination of significant liabilities owed to related parties, and absence of employees raise concerns regarding operational sustainability and underlying risk. Further due diligence into the company’s restructuring and current business activities is recommended to fully assess financial stability.

VERSATILE DISTRIBUTION LTD - Analysis Report

Company Number: 13042139

Analysis Date: 2025-07-20 18:54 UTC

1. Risk Rating: MEDIUM
   The company shows a recent significant turnaround from negative net assets and shareholders' funds in 2024 to modest positive net assets in 2025. While this indicates improving solvency, the absolute figures remain small and the company's financial history includes substantial prior losses and liabilities. The lack of employees in the latest year raises concerns about operational capacity and sustainability.

2. Key Concerns:

• Historical substantial negative net assets and liabilities (e.g., -£27k net assets in 2024), indicating prior financial distress that may have lingering effects.
• Sharp reduction in creditors and liabilities from 2024 to 2025 largely due to elimination of amounts owed to group undertakings, which may reflect restructuring but also potential related-party risk.
• No employees reported in the latest year despite having 2 in the prior year; this may point to reduced operational activity or dependency on contractors, affecting long-term sustainability.

3. Positive Indicators:

• The latest financial year shows a positive net asset position (£5,769) and shareholders’ funds (£5,369), a marked improvement compared to prior years.
• Current liabilities are low (£1,269) relative to current assets (£4,038), indicating a positive working capital position and improved short-term liquidity.
• The company is up to date with filings and accounts, demonstrating regulatory compliance and governance discipline.

4. Due Diligence Notes:

• Investigate details behind the elimination of £29,132 creditors falling due after more than one year from 2024 to 2025, specifically the repayment or restructuring of amounts owed to group undertakings.
• Assess the current operational model given zero employees reported in 2025 and whether the company is engaged in active trading or relying on outsourcing/contractors.
• Review cash flow statements and turnover trends (not included here) to better understand liquidity dynamics and revenue generation capability.
• Confirm the valuation and recoverability of assets given the prior negative net asset position and check for any contingent liabilities or related-party transactions.