WICKLOW HOMES LIMITED
Company number 03082437 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Commercial Credit Assessment: WICKLOW HOMES LIMITED
1. Credit Opinion: CONDITIONAL
Rationale: Wicklow Homes Limited presents a fundamentally sound balance sheet with net assets of £2.69M and negligible leverage, but the credit profile is tempered by significant liquidity constraints and key-person dependency. The cash position has deteriorated substantially from £1.86M (2018) to £209K (2025), and the quick ratio falls below 1.0x. While the asset base provides strong collateral coverage, the illiquid nature of the investment portfolio and property stocks raises concerns about debt service capacity under stress. Approval is conditional on adequate security and appropriate covenant structures.
2. Financial Strength
Balance Sheet Summary (FY2025):
| Metric | Amount |
|---|---|
| Total Assets | £3,015,717 |
| Total Liabilities | £323,037 |
| Net Assets | £2,692,680 |
| Gearing (Liabilities/Assets) | 10.7% |
Asset Composition: - Tangible Fixed Assets: £1,034 (negligible) - Stocks: £1,056,004 (35% of total assets) - Investments: £1,750,000 (58% of total assets) - Cash: £208,679 (7% of total assets)
Assessment: The balance sheet is asset-rich with minimal liabilities. The debt-to-equity ratio is approximately 12%, indicating very conservative leverage. However, the asset quality warrants scrutiny — the £1.75M investment and £1.056M in stocks represent 93% of total assets and are inherently illiquid. The investment has remained static at £1.75M since at least FY2024, suggesting it may be a long-term property holding rather than a liquid financial instrument.
Net Asset Trajectory (10-year trend):
| Year | Net Assets | YoY Change |
|---|---|---|
| 2016 | £2,067,508 | — |
| 2017 | £2,359,894 | +£292,386 |
| 2018 | £2,611,574 | +£251,680 |
| 2019 | £2,628,269 | +£16,695 |
| 2020 | £2,568,778 | -£59,491 |
| 2021 | £2,499,140 | -£69,638 |
| 2022 | £2,531,194 | +£32,054 |
| 2023 | £2,631,363 | +£100,169 |
| 2024 | £2,661,654 | +£30,291 |
| 2025 | £2,692,680 | +£31,026 |
The company demonstrated strong growth through 2018, followed by a period of modest decline (2019-2021), and has since returned to gradual growth. This pattern aligns with UK property market cycles.
3. Cash Flow Assessment
Liquidity Position:
| Metric | FY2025 | FY2024 | FY2018 |
|---|---|---|---|
| Current Ratio | 9.3x | 9.2x | 8.6x |
| Quick Ratio | 0.65x | 0.55x | 5.4x |
| Cash/Liabilities | 0.65x | 0.55x | 5.4x |
Critical Observation: The current ratio appears healthy at 9.3x, but this is misleading. Stripping out the illiquid stocks and investments, the quick ratio is only 0.65x — meaning the company cannot cover its current liabilities from cash alone. This represents a significant deterioration from the 2018 position when the quick ratio was 5.4x.
Cash Trajectory:
| Year | Cash | Change |
|---|---|---|
| 2018 | £1,858,342 | — |
| 2019 | £1,171,749 | -£686,593 |
| 2020 | £1,092,851 | -£78,898 |
| 2021 | £1,017,719 | -£75,132 |
| 2022 | £1,205,450 | +£187,731 |
| 2023 | £158,885 | -£1,046,565 |
| 2024 | £177,451 | +£18,566 |
| 2025 | £208,679 | +£31,228 |
The £1.05M cash decline between FY2022 and FY2023 is particularly notable and likely corresponds to the acquisition or reclassification of the £1.75M investment asset. While cash has stabilised in the last two years, it remains at historically low levels.
Working Capital Assessment: Net current assets of £2.69M appear substantial, but the composition is heavily skewed toward non-cash items. The company would struggle to meet an unexpected large liability from operating cash flow alone.
4. Monitoring Points
| Metric | Current | Threshold | Action Trigger |
|---|---|---|---|
| Quick Ratio | 0.65x | <0.5x | Immediate review |
| Cash Position | £209K | <£150K | Covenant breach |
| Net Assets | £2.69M | <£2.4M | Downgrade review |
| Current Liabilities | £323K | >£500K | Liquidity stress |
| Director's Current Account | Noted | Material debit balance | Investigate |
| Investment Valuation | £1.75M | Impairment indicators | Collateral review |
Key Risk Factors to Monitor:
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Key-Person Dependency: The company has one employee (Mr James Kelly) who serves as Managing Director and PSC. Any incapacity could halt operations entirely.
-
Director's Current Account: The accounts note that the director's current account is "debited with personal transactions and credited with dividends." This requires careful monitoring to ensure personal drawings don't erode the company's capital base.
-
Investment Realisability: The £1.75M investment represents 58% of total assets. If this is a property holding, valuation risk exists. If it's a financial instrument, liquidity risk applies. The static valuation year-on-year should be investigated.
-
Stock Valuation: Stocks of £1.056M unchanged from FY2024 may indicate slow-moving property inventory or a long-term holding. Either scenario affects liquidity.
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Filing Compliance: Accounts are filed as "Unaudited Abridged" under the small companies regime, limiting visibility into profitability, operating cash flows, and related party balances. Full P&L data is not disclosed.
Recommended Facility Structure
If lending is considered, the following structure mitigates identified risks:
- Security: First legal charge over the £1.75M investment and/or property stocks
- Covenants: Minimum net assets of £2.5M; maximum current liabilities of £400K; quick ratio minimum 0.5x
- Monitoring: Annual review of investment valuation; quarterly cash flow reporting; director's current account to be kept below £50K debit balance
- Tenor: Short-to-medium term (3-5 years maximum) given cyclical nature of property development