Company Number: 13520896

Analysis Date: 2025-07-20 13:59 UTC

1. Risk Rating: HIGH
   The company’s solvency and liquidity position has deteriorated significantly over the latest financial year, with net assets dropping to just £1 and current liabilities nearly equaling current assets. This indicates a high risk that the company may struggle to meet its short-term obligations.

2. Key Concerns:

• Severe Erosion of Equity: Net assets declined from £5,228 in 2023 to £1 in 2024, suggesting accumulated losses or write-downs that have consumed shareholder funds.
• Tight Working Capital: Current assets (£27,336) barely exceed current liabilities (£25,940), leaving minimal buffer for operational needs or unexpected expenses.
• Reliance on a Single Principal: One individual holds 75-100% shareholding and voting rights, concentrating control and potentially increasing governance risks.

3. Positive Indicators:

• Up-to-Date Filings: Accounts and confirmation statements are filed on time with no overdue notices, indicating compliance with statutory requirements.
• Stable Employment Level: The company maintained an average of 2 employees, consistent over the reporting periods, suggesting operational continuity.
• Ongoing Trading Status: The company remains active since incorporation in 2021, with no signs of formal insolvency proceedings.

4. Due Diligence Notes:

• Examine Profit and Loss Details: Limited data is available on income, expenses, or losses leading to the equity erosion; review detailed P&L or management accounts for underlying causes.
• Assess Cash Flow Stability: Investigate cash flow patterns given tight working capital to confirm ability to meet payables and payroll.
• Review Director and Related Party Transactions: Given single shareholder/director dominance, verify if any transactions have impacted financial position.
• Consider Industry Impact: The company operates in food and catering services, a sector sensitive to economic cycles and regulatory changes; assess market conditions and client base stability.
• Confirm Contingent Liabilities: Check for any off-balance sheet liabilities or pending legal issues that may worsen financial standing.