GLENERROL LIMITED
Company number SC223952 · 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.
Financial Health Assessment — GLENERROL LIMITED (SC223952)
Diagnostic review based on the latest filed accounts (period ended 21 December 2025) and up to 10 years of financial history.
1. Financial Health Score
Grade: D− (Poor — High Risk, Dependent on External Support)
Why this grade:
On a standalone basis, this company's vital signs would read as critical. It has negative net assets of £3.19m, meaning its liabilities exceed its assets by roughly 37%. It has been balance-sheet insolvent every year since 2019. Its cash balance of £51,915 is almost invisible against £11.94m of creditors due within one year.
Two things pull the grade up from an outright F:
- The trend is slowly improving. Net liabilities have narrowed from £4.25m (2020) to £3.19m (2025) — roughly £210k of repair per year.
- There is a substantial asset base and an apparent group lifeline. The company holds £6.32m of investment property and is wholly owned (>75%) by Lynnet Leisure (Properties) Limited, which is effectively acting as the company's life-support system.
The grade reflects a patient that is chronically, not acutely, unwell — stable enough to keep going, but only because someone else is holding the drip.
2. Key Vital Signs
| Vital Sign | 2025 (11.7 mths) | 2024 | 2023 | Clinical Reading |
|---|---|---|---|---|
| Net assets (equity) | −£3,194,090 | −£3,292,869 | −£3,341,205 | Negative equity — balance-sheet insolvent |
| Current ratio | 0.20 | 0.20 | n/a | Only 20p of short-term assets per £1 of short-term debt |
| Cash at bank | £51,915 | £9,467 | £32,063 | Barely a pulse |
| Cash ÷ current liabilities | 0.4% | 0.1% | — | No liquidity buffer whatsoever |
| Total liabilities | £11,941,775 | £12,075,893 | £12,214,382 | Slowly deleveraging |
| Liabilities ÷ total assets | 137% | 138% | 138% | Liabilities exceed assets |
| Investment property | £6,320,141 | £6,320,141 | — | 72% of all assets — the company's skeleton |
| Debtors (<1 yr) | £2,329,099 | £2,445,594 | — | 27% of assets, likely group balances |
| Accumulated losses | −£3,843,092 | −£3,941,871 | −£3,990,207 | Historic losses still on the books |
| Tangible fixed assets | £46,530 | £7,822 | — | Negligible operating asset base |
Compliance vitals: Accounts and confirmation statement are up to date, not overdue. The company files under the small-company regime (Total Exemption Full) and claims audit exemption under s477 Companies Act 2006. Share capital is £2.
3. Diagnosis
What the numbers reveal
Symptom 1 — Chronic negative equity (structural bone loss). The company swung from positive net assets of +£3.66m (2017) to −£2.84m (2019) — a £6.15m deterioration in two years. It has never recovered. This is not a temporary wound; it is a long-term structural condition.
Symptom 2 — Severe liquidity deficiency (low blood pressure). A current ratio of 0.20 means the company cannot meet its short-term obligations from short-term resources. With £11.94m of creditors all falling due within one year, and only £2.38m of current assets, there is a £9.56m working capital hole. Crucially, the accounts show no long-term debt at all — every liability is classified as current. That is unusual and typically signals that obligations are being rolled forward informally rather than formally refinanced.
Symptom 3 — Cash starvation (weak pulse). £51,915 of cash against £11.94m of current liabilities is a cash-coverage ratio of 0.4%. In practical terms, the company is living hand-to-mouth. The improvement from £9,467 to £51,915 is welcome but immaterial at this scale.
Symptom 4 — Asset shrinkage, liability persistence. Total assets have fallen from £15.73m (2017) to £8.75m (2025) — a 44% reduction. Liabilities have barely moved (£11.67m → £11.94m). The company is getting smaller without getting safer.
Symptom 5 — Concentration risk. 72% of assets sit in a single investment property carried at directors' fair value (£6.32m), supported by a £649,000 revaluation reserve. 27% sits in debtors that are likely intercompany balances. Both are illiquid and both carry valuation/recoverability risk. If the property were written down, net liabilities would deepen immediately.
Symptom 6 — Group dependency (life support). The PSC is Lynnet Leisure (Properties) Limited (>75% of shares and votes), and the directors' going-concern statement relies on "the Group and Company's current and anticipated financial position." The company is solvent only for as long as the group chooses to keep it so.
Symptom 7 — Governance signals. name shown to subscribers resigned as both director and secretary on 22 December 2025 — one day after the period end — while remaining an individual PSC via a trust. The accounting period was also shortened to 21 December 2025, and the accounts were signed on 28 August 2026, eight months after year end. These are the kinds of markers that often accompany restructuring, ownership changes, or a transaction. They warrant explanation.
Blind spot: As a small company, no profit and loss account is filed. We cannot see turnover, gross margin, EBITDA, or interest cover. Diagnosing without a P&L is like assessing heart health without an ECG — we can see the patient is alive, but not how hard the heart is working.
Underlying condition
Glenerrol is best understood as a group property and asset-holding vehicle that has accumulated historic losses, is funded by related-party creditors rather than bank debt, and is being kept solvent through group support rather than trading performance. It is not in immediate crisis, but it has no independent financial resilience.
4. Prognosis
Base case (group support continues): Stable but stagnant. Net liabilities continue to narrow slowly (~£100k–£200k per year). The company survives as a group vehicle.
Adverse case (group support withdrawn, or a creditor demands repayment): The £11.94m current liability cliff and 0.4% cash coverage mean there is no standalone defence. Risk of formal insolvency proceedings would rise sharply.
Favourable case (property monetised or debt restructured): A property disposal or a debt-for-equity conversion with the parent could eliminate negative equity in a single stroke and restore genuine solvency.
5. Recommendations
Immediate (0–3 months) 1. Formalise group support. Obtain written, dated support letters from Lynnet Leisure (Properties) Limited and any material creditors confirming they will not demand repayment for at least 12 months. This underpins the going-concern assertion and protects the directors. 2. Restructure the liability profile. Convert or reclassify intercompany balances from "due within one year" into long-term debt or equity. A debt-for-equity swap with the parent would remove negative equity outright. 3. Build a cash buffer. Target a minimum of three months' operating costs in cash. Even £250k would transform the liquidity picture.
Short term (3–12 months) 4. Test the property valuation. Commission an independent external valuation of the £6.32m investment property. If it supports the carrying value, that is reassurance; if not, act early rather than late. 5. Review debtor recoverability. Confirm the £2.33m of debtors is genuinely collectible, and when. 6. Model cash flow scenarios. Run a 12-month rolling cash forecast with a downside case that assumes no new group funding. 7. Fill the governance gap. Confirm the board composition and secretary arrangements following the December 2025 resignation.
Medium term (12 months+) 8. Monetise or refinance. Use property value to secure long-term bank facilities and clear the short-term creditor cliff. 9. Restore profitability visibility. Even without filing a P&L, prepare robust monthly management accounts covering turnover, EBITDA, and interest cover, and monitor them against a recovery plan. 10. Set a solvency target. Aim to return net assets to positive within three years, with a clear annual milestone.