TROI LIMITED
Company number 10552493 · 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/HIGH
The company is solvent but exhibits a four-year trend of declining net assets and shareholder funds. Its thin working capital position and increasing short-term trade creditors signal potential liquidity pressure, though cash improved modestly in the latest year.
Key Concerns
1. Sustained Erosion of Net Assets – Net assets have fallen from £346k (2021) to £63k (2025), an 82% decline. Retained earnings correspondingly dropped from £346k to £63k, indicating repeated losses or significant capital distributions.
2. Liquidity and Creditor Dependence – Current liabilities are high relative to current assets (current ratio ~1.1). Trade creditors surged from £39k to £178k year-on-year, and accruals stand at £165k, suggesting potential reliance on supplier credit or delayed payments.
3. Equity Reduction via Share Buyback – In July 2025, the company repurchased 1,111 shares for £21,700, reducing share capital and retained earnings at a time when net assets were already declining. This raises questions about capital allocation and the directors’ confidence in near-term performance.
Positive Indicators
- Cash at bank increased from £135k to £202k in 2025, providing a liquidity buffer.
- No overdue filings for accounts or confirmation statement; the company maintains full statutory compliance.
- All long-term debt was repaid by year-end 2025 (creditors due after one year reduced to zero), reducing refinancing risk.
Due Diligence Notes
- Related-Party Exposures – The balance sheet shows £212k owed by group undertakings and £123k owed to associates. The nature of these transactions, their terms, and recoverability/payment timelines must be verified.
- Profitability Analysis – The income statement is not filed (small company exemption). Request management accounts to confirm whether the recent decline in net assets is driven by operating losses, dividends, or the share buyback.
- Share Buyback Rationale – Clarify the business case for repurchasing shares while net assets are shrinking. Determine if the buyback was funded from surplus cash or required drawing down working capital.
- Employee Reduction – Headcount fell from 16 to 13 in the year. Investigate whether this reflects restructuring, revenue contraction, or normal attrition.