WT STARS BUILDERS LTD

Executive Summary

WT STARS BUILDERS LTD exhibits increasing financial distress with declining turnover, growing losses, and a deteriorating net asset position. While regulatory filings are current and management stable, the significant negative equity and high long-term liabilities raise serious solvency and liquidity concerns. Careful scrutiny of debt obligations and operational sustainability is recommended before investment consideration.

WT STARS BUILDERS LTD - Analysis Report

Company Number: 14119823

Analysis Date: 2025-07-29 14:14 UTC

1. Risk Rating: HIGH
   The company shows significant negative net assets and a worsening equity position over the last reported year, indicating solvency concerns. The turnover is declining, losses are increasing, and liabilities exceed assets substantially.

2. Key Concerns:

• Negative shareholders’ funds: The net assets declined from -£3.43k in 2024 to -£16.08k in 2025, indicating increasing insolvency risk.
• Consistent operating losses: The company recorded a loss of £12.65k in 2025, worsening from a £6.23k loss the prior year, coupled with reduced turnover.
• High long-term liabilities: Creditors due after more than one year stand at roughly £38.7k, exceeding total assets, which pressures financial stability and refinancing ability.

3. Positive Indicators:

• No overdue filings: Both accounts and confirmation statements are up to date, suggesting regulatory compliance and good governance in reporting.
• Micro entity status: As a micro-entity, the company has minimal filing burdens, which may reduce administrative costs.
• Director control stability: The sole director and PSC is consistent, indicating stable management.

4. Due Diligence Notes:

• Review the nature and terms of long-term liabilities (£38.7k) to assess repayment obligations and covenants.
• Investigate cash flow trends and working capital management given low current assets (£2.97k) relative to current liabilities (£1.01k) and the drop in net current assets.
• Confirm the company’s business model viability given declining turnover (£78.8k to £58.3k) and increasing losses, and assess plans for returning to profitability.
• Clarify if the director’s dual role (director and secretary) impacts governance practices.
• Evaluate any contingent liabilities or off-balance sheet risks, although none were disclosed.