Company Number: 12515134

Analysis Date: 2025-07-29 12:17 UTC

1. Risk Rating: MEDIUM
   The company shows a modest net asset base and positive net current assets, but has substantial long-term liabilities that significantly offset its current assets. The improvement in net current assets is encouraging, but low cash balances and sizeable creditors due after one year raise concerns about solvency and liquidity.

2. Key Concerns:

• High Long-Term Creditors: The company has a large amount (£27,142) of creditors falling due after more than one year, which is substantially higher than the previous year (£3,000). This indicates increased long-term obligations that may pressure future cash flows.
• Low Cash Reserves: Despite growth in current assets, cash at bank remains low (£2,092), which could restrict the company’s ability to meet short-term commitments or unexpected expenses promptly.
• Thin Equity Base: Shareholders’ funds remain very low (£1,733), indicating limited buffer against losses or financial shocks, which raises concerns on financial stability and ability to absorb downturns.

3. Positive Indicators:

• Improvement in Net Current Assets: Net current assets improved significantly from £3,908 in 2023 to £28,875 in 2024, reflecting better short-term asset coverage of liabilities.
• Consistent Filing and Compliance: The company has no overdue accounts or confirmation statements, showing good regulatory compliance and governance discipline.
• Stable Directorship: The sole director has been in position since incorporation with no adverse records noted, which suggests continuity in management.

4. Due Diligence Notes:

• Investigate the nature and terms of the long-term creditors to understand repayment schedules and associated risks.
• Examine cash flow statements (not provided) to assess liquidity trends and operational cash generation capability.
• Review turnover and profitability trends (not disclosed here) to evaluate business sustainability given the low net assets and cash balances.
• Confirm if there are any contingent liabilities or off-balance sheet obligations that could impact solvency.
• Assess stock valuation methodology and inventory turnover since stocks form a large portion of current assets (£37,104).