Company Number: 13220529

Analysis Date: 2025-07-29 12:10 UTC

1. Credit Opinion: DECLINE
   Long Mao Ltd demonstrates persistent net liabilities and negative working capital over multiple years, indicating financial distress and an inability to meet short-term obligations. The micro-sized event catering business shows a deterioration in net assets from a marginally positive £680 in 2021 to a deficit of £3,038 in 2025. Given this ongoing negative equity position and lack of profitability data to suggest imminent turnaround, lending or extending credit facilities carries a high risk of default.

2. Financial Strength:
   The company’s balance sheet reveals chronic weaknesses: current liabilities significantly exceed current assets (£3,705 vs £667 in 2025), resulting in net current liabilities of £3,038. Total net assets and shareholders' funds are negative and worsening year-on-year (from -£96 in 2022 to -£3,038 in 2025), reflecting accumulated losses or insufficient capital injection. Share capital is nominal (£2). The absence of fixed assets data likely points to limited tangible collateral. Overall, the financial structure is fragile and undercapitalized.

3. Cash Flow Assessment:
   The reported current assets (including cash and receivables) are minimal and insufficient to cover short-term liabilities, indicating liquidity constraints. Negative net current assets imply the company may struggle to service day-to-day operational expenses and short-term debts without external funding. The company’s average number of employees rose to 2 in the latest year, implying some operational scale-up, but no evidence of improved cash inflows. Without cash flow statements, the risk of cash shortages is inferred from balance sheet deficits.

4. Monitoring Points:

• Monitor quarterly or interim financials for signs of improving liquidity and reduction in current liabilities.
• Track any capital injections or shareholder support to strengthen equity and working capital.
• Observe payment patterns to suppliers and creditors for potential delays or defaults.
• Review management actions to control costs and improve profitability given the highly competitive catering sector.
• Keep watch on any changes in director appointments or PSC disclosures that might indicate shifts in governance or control.