WINEYARD DEVELOPMENTS LTD

Executive Summary

Wineyard Developments Ltd is experiencing severe financial distress characterized by negative equity, poor liquidity, and high creditor reliance, undermining its ability to service debt. The company’s balance sheet weakness and cash flow constraints present significant credit risk, leading to a recommendation to decline credit at this stage. Close monitoring of debtor collections, creditor relations, and capital structure is essential if conditions change.

WINEYARD DEVELOPMENTS LTD - Analysis Report

Company Number: 13888768

Analysis Date: 2025-07-20 17:16 UTC

1. Credit Opinion: DECLINE
   Wineyard Developments Ltd exhibits significant credit risk due to its negative net assets and shareholders' funds, which have deteriorated from -£5,016 in 2023 to -£61,636 in 2024. The company shows a substantial short-term liquidity problem with current liabilities (£409,700) vastly exceeding current assets (£77,506), resulting in a net current liability of -£173,356. The introduction of long-term creditors (£409,700) in 2024 further increases financial leverage and risk. Given these factors, the company’s ability to meet debt obligations on time is highly uncertain without additional capital injection or operational turnaround.

2. Financial Strength:
   The balance sheet reveals a highly leveraged position. Tangible fixed assets increased significantly in 2024 (£521,421) due to property acquisition or capital expenditure, but this was financed largely by creditor funds rather than equity or retained earnings. Negative net assets indicate insolvency from an accounting perspective, and the equity base is insufficient to absorb losses. The company's capital structure relies heavily on creditor financing, which poses refinancing and solvency risks. There is no evidence of profitability or retained earnings to support growth or debt servicing.

3. Cash Flow Assessment:
   Cash holdings are negligible (£2 in 2024), and the company’s working capital is deeply negative, reflecting poor liquidity. The large debtor balance (£77,504) may be tied up in receivables, but collection efficiency is unknown. Current liabilities have ballooned, and there is a significant amount of debt due after one year, implying ongoing cash outflows for debt servicing. Overall, the company lacks the liquid assets necessary for day-to-day operations and creditor payments, suggesting cash flow stress.

4. Monitoring Points:

• Debtor collection and aging profile to assess cash inflows
• Management of creditor payment terms and debt restructuring efforts
• Capital raising activities or shareholder support to improve equity base
• Profitability trends and operational cash flow generation
• Changes in fixed asset valuations or disposals to release cash
• Directors’ actions on addressing negative net assets and liquidity issues