WOODS RESURFACING & UTILITIES LTD

Executive Summary

Woods Resurfacing & Utilities Ltd shows signs of financial growth with increasing net assets and investments in fixed assets, supporting operational sustainability. However, rising long-term lease obligations and relatively low liquid resources compared to current liabilities introduce moderate solvency and liquidity risks. Continued monitoring of debt servicing capacity and cash flow management is recommended for informed investment decisions.

WOODS RESURFACING & UTILITIES LTD - Analysis Report

Company Number: 13455712

Analysis Date: 2025-07-20 17:58 UTC

1. Risk Rating: MEDIUM
   Woods Resurfacing & Utilities Ltd demonstrates moderate financial stability with improving net assets and positive working capital. However, the significant increase in long-term finance lease obligations and relatively low cash balances relative to current liabilities raise some liquidity and solvency concerns.

2. Key Concerns:

• Rising Long-Term Debt Obligations: The company’s obligations under finance leases and hire purchase contracts after one year have increased sharply from £10,266 in 2023 to £216,898 in 2024, indicating growing leverage that may pressure future cash flows.
• Modest Cash Reserves vs. Current Liabilities: Cash at bank is £168,969 against current liabilities of £352,638, meaning potential liquidity strain if receivables are delayed or costs escalate.
• Concentration of Directors and Lack of Audit: The company is managed by a small group of directors with no external audit due to exemption; this may limit oversight and increase governance risks, especially in a capital-intensive construction sector.

3. Positive Indicators:

• Improved Net Assets and Working Capital: Net assets increased from £95,486 in 2023 to £149,726 in 2024, and net current assets improved from £38,153 to £113,370, indicating enhanced capitalization and liquidity position year over year.
• Growing Fixed Asset Base: Tangible fixed assets rose significantly from £86,678 to £312,659, suggesting investment in plant and equipment that supports operational capacity and future revenue generation.
• Timely Filing and Compliance: No overdue accounts or confirmation statements, showing good compliance with statutory filing requirements.

4. Due Diligence Notes:

• Review lease and hire purchase agreements to assess terms, interest rates, and repayment schedules to evaluate the impact of increased long-term liabilities on cash flow.
• Investigate aging of trade debtors and other receivables to verify collectability and cash conversion cycle.
• Assess profitability trends and future contracts pipeline, given the company is in a competitive construction niche (SIC 42110 - roads and motorways).
• Confirm any contingent liabilities or off-balance sheet commitments not disclosed in the accounts.
• Consider directors’ backgrounds and governance structure, given the absence of audit and small management team.