WELBECK CP (PORTSMOUTH) LIMITED

Executive Summary

Welbeck CP (Portsmouth) Limited presents a mixed risk profile with valuable investment property assets but significant short-term liabilities exceeding liquid assets. The reliance on related party debts and limited equity capital raise liquidity and solvency concerns, though compliance and management stability are positive factors. Further examination of debt terms and cash flow capacity is recommended to better assess operational sustainability.

WELBECK CP (PORTSMOUTH) LIMITED - Analysis Report

Company Number: 13633569

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

1. Risk Rating: MEDIUM
   The company holds significant investment property assets with a positive net asset position; however, the presence of substantial current liabilities exceeding current assets by over £6 million presents liquidity concerns. The small equity base and related party debts highlight potential solvency risks, albeit mitigated by the nature of property assets and absence of overdue filings.

2. Key Concerns:

• Liquidity Mismatch: Net current liabilities of approximately £6.17 million indicate the company’s short-term obligations exceed its liquid assets, which may pressure cash flow if liabilities are callable imminently.
• High Related Party and Group Debt: Over £6 million owed to group undertakings and £350,000 to a director, both repayable on demand and interest-free, could represent contingent liquidity risks if demands for repayment arise.
• Limited Equity and Capital Base: Called-up share capital is nominal (£1), and profit and loss reserves are modest relative to liabilities, limiting financial flexibility and buffer against adverse market conditions.

3. Positive Indicators:

• Stable Asset Base: Investment property valued at £6.75 million, up from £6.55 million the prior year, shows asset appreciation and potential for income generation.
• Timely Compliance: No overdue accounts or confirmation statement filings, indicating good regulatory compliance and governance practices.
• Experienced Management: Directors have been in office since incorporation with no indication of disqualifications or governance concerns.

4. Due Diligence Notes:

• Nature and Terms of Group and Director Loans: Clarify repayment terms, security, and whether these debts are likely to be called in the short term.
• Cash Flow Analysis: Obtain detailed cash flow forecasts to assess the company’s ability to meet current liabilities as they fall due.
• Valuation and Marketability of Investment Property: Confirm valuation methodology and market conditions to validate asset liquidity and realizable value.
• Contingent Liabilities and Guarantees: Investigate the guarantee to Handelsbanken and any implications for the company’s financial obligations within the group structure.