COGNISM LIMITED
Company number 09392705 · 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.
Risk Rating: MEDIUM
The company shows signs of strong equity backing and liquidity, but persistent losses, negative retained earnings, and a lack of recent financial data create uncertainty around its long-term viability.
Key Concerns
1. Accumulated Losses & Negative Retained Earnings – The profit and loss account deficit grew from £8.5m (2019) to £16.1m (2020), indicating the company is not yet profitable. Continued losses without a clear path to profitability would erode equity and raise solvency questions over time.
2. Stale Financial Data – The most recent filed accounts are for year-end 31 December 2020. Although the company has a later accounting reference date (2024-12-31), the absence of any filed data for 2021–2024 is a significant gap. Investors cannot assess current trading performance, debt levels, or cash generation.
3. Intercompany Exposure – As at 2020, £1.68m of debtors (49% of total) were amounts due from group undertakings. Recoverability of these balances depends on the financial health of related entities, which is not disclosed. Similarly, £166k in group payables creates cross-party dependency.
Positive Indicators
1. Strong Liquidity – In 2020, current assets (£5.77m) comfortably exceeded current liabilities (£2.14m), with cash of £2.37m providing a buffer.
2. Substantial Equity Injections – Share premium alone rose from £9.45m to £18.28m in 2020, and further post-balance sheet share issues of USD12.6m were noted. This demonstrates continued investor confidence.
3. Growth Trajectory – Total assets more than tripled in 2020 (£9.49m vs £3.15m), driven by acquisitions of Mailtastic GmbH and Netstag GmbH, suggesting strategic expansion in the sales intelligence market.
Due Diligence Notes
- Request full accounts for 2021, 2022, 2023, and 2024 to understand revenue growth, margin trends, and whether losses are narrowing.
- Investigate the nature of the capital contribution reserve (£4.76m in 2020) – likely share-based payment costs – and its impact on future dilution.
- Review intercompany debtor ageing and the financial standing of group subsidiaries, particularly Mailtastic and Netstag.
- Confirm that all filing requirements for the group accounts have been met; the latest filing date shown (2024-12-31) and extended due date (2026-09-30) suggest the company may have changed its year-end, but this needs verification.
- Assess recent director resignations (late 2025) for any indication of governance or strategic changes.