C K FIRES LIMITED
Company number 05524093 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Investment Risk Analysis: C K Fires Limited
1. Risk Rating: LOW
Justification: C K Fires Limited demonstrates a fundamentally sound financial position with consistent net asset growth, low leverage, and strong liquidity ratios. The company benefits from the backing of a substantial Swedish parent (Nibe Industrier AB). However, elevated stock levels and a reference to "adverse conditions" in the going concern statement warrant monitoring, preventing an unqualified low-risk assessment.
2. Key Concerns
i) Elevated and Growing Stock Levels
Stock has increased from £2.07M (2024) to £2.51M (2025), representing approximately 45% of total current assets. For a manufacturer and retailer of electric domestic appliances, this concentration raises questions about potential obsolescence risk, demand softness, or over-ordering. Given the pace of technology evolution in heating appliances, inventory that cannot be sold at full margin could erode profitability.
ii) Significant Debtors Position
Trade debtors stand at £2.46M (44% of current assets), having grown from £2.34M year-on-year. Combined with the stock position, approximately 89% of current assets are tied up in stock and debtors. While the current ratio of 4.1x appears healthy, the quality of liquidity depends materially on debtor collection rates and stock realisability.
iii) Going Concern Language References "Adverse Conditions"
The accounts explicitly reference "current adverse conditions" and note that the going concern assessment relies on "measures that could be undertaken to mitigate" these conditions. This language, while ultimately concluding on a going concern basis, suggests the directors have identified material uncertainties. Without access to the profit and loss account (filleted under small companies regime), the severity of these conditions cannot be independently assessed.
3. Positive Indicators
i) Consistent and Substantial Net Asset Growth
Net assets have grown from £1.86M (2019) to £4.74M (2025), representing a compound annual growth rate of approximately 16.5%. This trajectory, built almost entirely through retained earnings (share capital is only £4), indicates a profitable and cash-generative business over the medium term.
ii) Low Financial Leverage
Total liabilities of £1.35M represent just 21.5% of total assets (£6.27M). Long-term creditors are modest at £75.8K, and the company carries no apparent bank debt within current liabilities. This conservative capital structure provides substantial headroom.
iii) Parent Company Backing and Governance
Nibe Industrier AB, a publicly listed Swedish industrial group (NASDAQ Stockholm), holds more than 75% of shares and voting rights. This ownership structure provides implicit financial support, strategic direction, and access to group resources. The presence of Swedish directors (name shown to subscribers, name shown to subscribers) alongside UK-based management suggests active parent oversight.
iv) Regulatory Compliance
Accounts and confirmation statements are filed on time with no overdue items. The company has been active for nearly 20 years since incorporation in 2005, with no indications of insolvency proceedings or regulatory issues.
4. Due Diligence Notes
a) Profitability Assessment
The accounts are filleted under Section 444 of the Companies Act 2006, meaning the Statement of Income and Retained Earnings has not been delivered. This prevents assessment of revenue, gross margin, operating costs, and profit trends. The retained earnings increased by approximately £748K between 2024 and 2025, providing some proxy for profitability, but dividends (if any) are unknown.
b) Related Party Transactions
Given the Nibe Industrier AB controlling interest, related party transactions with the parent or fellow group entities could be material. The balance sheet shows only £1 in fixed asset investments, suggesting no significant inter-company investments, but trading relationships, management charges, or transfer pricing arrangements should be investigated.
c) Stock Composition and Ageing
The stock figure of £2.51M warrants detailed examination. Specifically: the split between finished goods, work-in-progress, and raw materials; ageing profiles; provision for obsolescence; and gross margin expectations on this inventory. The 21% year-on-year increase in stock should be assessed against revenue growth (which is not publicly available).
d) Cash Flow Volatility
Cash has exhibited significant volatility: £2.03M (2021), £710K (2022), £575K (2023), £192K (2024), £593K (2025). The 2024 trough of £192K, though recovered, may indicate seasonal working capital pressures or lumpy cash flows. Understanding the drivers of this variation is important for assessing ongoing liquidity risk.
e) Director Resignation
name shown to subscribers resigned as director on 9 September 2025. While director changes are routine, the timing (mid-financial year) and any associated circumstances should be clarified, particularly given the reference to "adverse conditions."
f) Provisions
Provisions of £100.9K (reduced from £131.8K) should be investigated. The nature, timing, and expected cash outflows associated with these provisions could affect future cash flows.