Company Number: SC681609

Analysis Date: 2025-07-29 13:33 UTC

1. Risk Rating: HIGH

Justification: The company’s balance sheet shows extremely tight net current assets (£100) against substantial current liabilities (£2.23m), indicating critical liquidity risk. The net assets remain nominal (£100) despite significant work-in-progress stock and creditors, suggesting low equity buffer. The company relies heavily on secured loans with significant creditor balances that have increased markedly year-on-year. These factors collectively imply a high risk of solvency issues.

2. Key Concerns:

• Liquidity Risk: Current liabilities nearly equal current assets, leaving minimal working capital to meet short-term obligations.
• Capital Structure: Shareholders’ funds are minimal (£100), indicating very low equity and high leverage.
• Reliance on Secured Creditors: Large secured loans from related parties and financial institutions create dependency and potential refinancing risk.

3. Positive Indicators:

• Up-to-date Filings: No overdue accounts or confirmation statements, indicating good compliance.
• Established Director and PSC: Single director with 75-100% ownership providing clarity on control.
• Growing Work-in-Progress: Increase in stock balances may reflect ongoing construction projects and potential revenue growth.

4. Due Diligence Notes:

• Review detailed income statement and cash flow data to assess profitability and cash generation.
• Investigate nature and terms of secured loans and creditor agreements, including repayment schedules.
• Validate valuation and realizability of work-in-progress stock to determine asset quality.
• Assess future contract pipeline and operational plans to evaluate business sustainability.
• Confirm that there are no director disqualifications or regulatory compliance issues beyond filings.