WIRE TEK LIMITED

Executive Summary

WIRE TEK LIMITED demonstrates sound regulatory compliance and maintains positive net current assets, indicating an ability to meet short-term obligations. However, declining net assets and cash reserves warrant caution, as they suggest emerging solvency and liquidity risks for this micro-scale operation. Further investigation into profitability, debtor quality, and operational strategy is advised to fully assess financial sustainability.

WIRE TEK LIMITED - Analysis Report

Company Number: 13538128

Analysis Date: 2025-07-20 16:48 UTC

1. Risk Rating: MEDIUM
   The company shows ongoing operations with positive net current assets and equity; however, there is a declining trend in net assets and cash balances over recent years, which introduces moderate solvency and liquidity concerns given the small scale of the business.

2. Key Concerns:

• Declining Net Assets: Net assets decreased from £11,932 in 2023 to £8,810 in 2024, indicating erosion of equity that may reflect losses or distributions exceeding profits.
• Reduced Cash Reserves: Cash at bank halved from £12,874 in 2023 to £6,123 in 2024, potentially signaling cash flow pressure despite positive working capital.
• Limited Scale and Resources: The company operates with only one employee and minimal fixed assets, which may constrain operational stability and growth potential, especially given the dual SIC codes involving building development and electricity trade.

3. Positive Indicators:

• Current and Timely Filings: No overdue accounts or confirmation statements, indicating good regulatory compliance.
• Positive Net Current Assets: £9,964 as of 2024 year-end, showing the company’s short-term assets exceed liabilities.
• Sole Shareholder Control: Clear ownership structure with a single individual controlling 75-100% shares, which may facilitate decisive management actions.

4. Due Diligence Notes:

• Review the company’s profit and loss statements or management accounts (not filed) to assess profitability trends and reasons behind declining net assets.
• Investigate the nature and collectability of debtors (£19,242) given their material increase and impact on liquidity.
• Clarify the company’s operational model and revenue streams, especially how the two SIC codes are integrated and whether trading in electricity involves significant regulatory or credit risk.
• Confirm any off-balance sheet liabilities or contingent risks not disclosed in abridged accounts.
• Assess the director’s plans for restoring equity and liquidity levels or potential funding requirements.