TRIPLE P PROJECTS LTD

Credit Opinion: CONDITIONAL

Triple P Projects Ltd has a strong paper balance sheet — £1.021m net assets, no long-term debt disclosed, and a long trading history — but the credit case is not clean because liquidity is heavily dependent on £1.021m of “other debtors,” equal to about 82% of total assets. Excluding those other debtors, current assets are only £222k against £225k of current liabilities, and cash is just £43k. The latest accounts are unaudited, cover only a three-month period, and do not include a profit and loss account, so turnover, EBITDA and debt-service capacity cannot be verified from the filed data.

We would support a facility only conditionally, subject to satisfactory validation of the other debtors, receipt of management accounts and a cash flow forecast, confirmation that tax/VAT/CIS liabilities are current, and an appropriate security package or parent company guarantee where related-party exposure exists. If the other debtors are not readily recoverable or are not supported by the wider group, the stance should move to decline.

Financial Strength

• Net assets: £1,021,300; shareholders’ funds £1,021,300. The company is balance-sheet solvent on the filed figures.
• Liabilities: £225,424, all falling due within one year. No long-term bank debt is disclosed in the latest balance sheet. Liabilities are about 18% of total assets, so gearing is low on paper.
• Asset quality is the key weakness: other debtors of £1,020,701 represent about 82% of total assets and 82% of current assets. Trade debtors are only £101,093, stock £74,303 and cash £43,488. Tangible fixed assets are £3,791, so the business is asset-light.
• Creditors: trade creditors £34,732; taxation and social security £94,178; accruals and deferred income £92,940; other creditors £3,574. The tax and social security balance is significant relative to cash.
• Trend: net assets increased by £30,056 over the three months to 28 February 2025, but cash fell by £50,220. The profit and loss reserve increased to £1,021,200, suggesting retained profit, but cash conversion is weak.
• Management/compliance: directors are current, filings are not overdue, and no director disqualification records are shown in the supplied data. However, the PSC structure — Triangle Fire Systems Limited owning more than 75%, alongside individual PSCs — needs clarification, particularly whether the other debtors are related-party balances.

Cash Flow Assessment

• Cash position: £43,488 at 28 February 2025, down from £93,708 at 30 November 2024 and £634,053 at 30 November 2023. The cash ratio is only 0.19x against current liabilities.
• Reported current ratio: 5.5x (£1,242,933 current assets / £225,424 current liabilities), but this is flattered by the other debtors.
• Adjusted liquidity: excluding other debtors, current assets are £222,232 against £225,424 current liabilities — approximately 0.99x. Excluding stock as well, the adjusted quick ratio is about 0.66x. Cash plus trade debtors is £144,581 against current liabilities of £225,424, or about 0.64x.
• Working capital: net current assets are £1,017,509, but the quality of those assets is uncertain. Stock fell 32% over the period, trade debtors rose 27%, and creditors fell 28%, while cash reduced sharply.
• Debt service: no interest-bearing debt is disclosed, but any new facility would need to be serviced from trading cash flow. Because no P&L is filed, operating cash flow and debt-service cover cannot be measured. A 13-week cash flow forecast and monthly management accounts are required.

Monitoring Points

• Other debtors: obtain a full breakdown, ageing, counterparties, legal right of set-off and recoverability. Confirm whether balances are related-party/intercompany loans and whether they are repayable on demand.
• Cash headroom: monitor monthly bank statements and a 13-week cash flow. Cash of £43k against £225k current liabilities leaves little room for delay in debtor collections.
• Tax and compliance: confirm VAT, PAYE/CIS and corporation tax are up to date. The £94k taxation and social security creditor should be monitored closely.
• Trade debtors and contracts: track debtor days, customer concentration, retentions, work-in-progress and contract pipeline. Construction-sector risk includes subcontractor performance and payment terms.
• Covenants/security: consider covenants around adjusted current ratio excluding other debtors, tangible net worth, no additional related-party lending without consent, and a parent company guarantee or debenture where appropriate.
• Filing and ownership: monitor accounts/confirmation statement compliance and any change in PSC structure.