Company Number: 12437985

Analysis Date: 2025-07-29 15:57 UTC

1. Credit Opinion: DECLINE
   ZIMA CREATIVE LTD exhibits persistent and worsening negative net asset positions, with net liabilities increasing from £66k in 2022 to nearly £74k in 2023. The company has significant long-term debt (£50k creditors due after more than one year) and ongoing current liabilities exceeding current assets, resulting in negative working capital. The absence of an audit and reliance on micro-entity accounting standards limit insight into profitability, but the balance sheet trends strongly suggest financial distress. Without corrective action or capital injection, the company’s ability to meet debt obligations and trade payables is doubtful. Hence, credit facilities should not be extended at this stage.

2. Financial Strength:
   The balance sheet shows very weak financial health. Fixed assets are negligible (£738 in 2023), and current assets remain minimal (£5,385), while current liabilities stand at £27,939, leading to a net current liability of £22,554. Long-term liabilities of £50,000 further strain solvency. The company’s net assets are deeply negative (£73,816), indicating accumulated losses and erosion of shareholder equity. This negative equity position has deteriorated year-on-year over the last three years, highlighting ongoing losses or insufficient capital support.

3. Cash Flow Assessment:
   Cash balances have dropped significantly from £42,477 in 2019 to an estimated £4,000 in 2022, with no data for 2023’s cash explicitly provided but current assets remain low. The working capital deficiency suggests liquidity constraints. The consistent negative net current assets imply the company may be reliant on external financing or creditor forbearance to meet short-term obligations. The company’s ability to generate positive operating cash flow is unclear but appears weak given the declining liquidity and worsening creditor position.

4. Monitoring Points:

• Watch for improvements in net current assets and overall net assets to assess any capital infusion or profit turnaround.
• Monitor cash balances and turnover of creditors to gauge liquidity and payment discipline.
• Track any changes in long-term liabilities or restructuring efforts to reduce debt burden.
• Assess management changes and strategic plans addressing financial stability and profitability.
• Review future filed accounts for evidence of improved profitability or reduction in losses.