WHISPERING SMITH PROPERTIES LIMITED

Executive Summary

Whispering Smith Properties Limited operates with significant investment property assets but faces liquidity pressure due to large current liabilities, primarily owed to group undertakings. The company remains solvent with growing net assets and no overdue filings, supported by parent company assurances. However, liquidity risk and exposure to secured bank loans warrant closer examination to confirm ongoing operational stability.

WHISPERING SMITH PROPERTIES LIMITED - Analysis Report

Company Number: 13287175

Analysis Date: 2025-07-19 12:35 UTC

1. Risk Rating: MEDIUM

The company demonstrates some financial strain, particularly in liquidity, evidenced by significant net current liabilities. However, the presence of substantial investment property assets and shareholder support somewhat mitigate immediate solvency concerns.

2. Key Concerns:

• Liquidity Risk: The company has large net current liabilities (£2.78 million) compared to current assets (£149,670), indicating potential cash flow challenges to meet short-term obligations.
• Concentration of Debt to Group Companies: A sizeable proportion of current liabilities (£2.48 million) is owed to group undertakings with repayment deferred, which could pose risk if group support diminishes.
• Secured Bank Loans and Long-Term Debt: Bank loans secured against investment property total £3.84 million, which is a significant liability relative to the net assets and could pressure cash flow if rental income or property values decline.

3. Positive Indicators:

• Substantial Investment Property Assets: Fixed assets valued at approximately £6.77 million provide strong asset backing and potential collateral.
• Improved Net Assets: Net assets increased from £62,294 in 2023 to £333,301 in 2024, indicating some strengthening in equity.
• No Overdue Filings: Accounts and confirmation statements are up to date, reflecting good regulatory compliance.
• Going Concern Affirmed: Directors have assessed risks and continue to prepare accounts on a going concern basis, supported by group undertakings’ commitment not to demand immediate repayment of intercompany balances.

4. Due Diligence Notes:

• Examine Cash Flow and Debt Servicing Capacity: Review detailed cash flow statements and rental income stability to assess ability to service bank loans and short-term liabilities.
• Assess Group Support Reliability: Investigate the financial health and strategic intentions of the parent company (Whispering Smith Group plc) and related parties providing intercompany loans.
• Valuation and Liquidity of Investment Property: Confirm current market valuations and liquidity of properties securing bank debt, including potential impacts of market downturns.
• Contingent Liabilities: Understand the nature and likelihood of liabilities related to guarantees provided to Barclays Bank for fellow group companies and any associated risks.
• Director and Governance Review: While directors appear compliant, confirm no adverse records or conflicts that might affect operational stability.