Credit Assessment: Wolverhampton Airport Limited (05068031)

1. Credit Opinion: DECLINE (standalone basis)

This company is balance-sheet insolvent and cannot be considered for unsecured or even conventionally secured credit on its own merits. The decisive facts:

• Net liabilities of £2.26M at 30 June 2026 — total liabilities (£3.72M) are seven times total assets (£525k)
• Negative equity in every year of the six-year visible history, with the deficit worsening from £1.5M to £2.26M
• Net current liabilities of £3.2M — creditors due within one year are roughly 14 times current assets
• Filleted accounts — no income statement filed (permitted under s.444 CA 2006 for small companies), meaning turnover, margins, and debt service capacity are entirely invisible to a lender

The company trades only because its creditors — almost certainly the parent, Wolverhampton Airport Investments Ltd (PSC holding >75% of shares and votes) — are not calling in £3.7M of dues. That is support, not repayment capacity.

Path to reconsideration: a guarantee from Wolverhampton Airport Investments Ltd supported by analysis of the parent's accounts, tangible security over the newly capitalized assets, and management accounts providing earnings visibility.

2. Financial Strength

Very weak, with one notable recent development.

• Shareholders' funds: negative £2,262,968, deteriorating steadily each year. Retained losses grew by £255,737 in FY26 alone, and the inferred annual loss has accelerated every period (~£15k in FY21, ~£107k in FY22, ~£256k in FY26).
• Share capital is a nominal £1,000 — no meaningful equity cushion.
• The FY26 development: fixed assets jumped from £33,510 to £933,179 (long leasehold land/buildings, plant and machinery). This is a material capitalization and suggests property acquisition or site development. However, it was accompanied by a £1.49M increase in creditors — the investment is debt-funded, likely via the parent, not self-generated.
• Mild positives: 20-year operating history, accounts audited with an unqualified opinion, clean filing record, no director disqualifications on record. These speak to basic governance, not solvency.

3. Cash Flow Assessment

• Cash at bank: £262,540 (up from £95,688) — the strongest position in the visible record, but modest in absolute terms.
• Debtors doubled to £262,736 — worth understanding whether this reflects genuine trading growth or intercompany balances.
• The core problem: liquid assets of ~£525k against £3.72M falling due within one year. The working capital deficit of £3.2M is structural, not seasonal.
• With no P&L filed and inferred losses of ~£256k for the year, the company is cash-consuming. It has no capacity to service external debt from its own operations; repayment would depend entirely on group support or realization of the newly acquired assets.

4. Monitoring Points

If any exposure exists, or a parent-guaranteed structure is pursued, monitor:

1. Going concern disclosures in the next audit — watch for a material uncertainty paragraph, which would confirm the solvency dependency
2. Composition of the £3.72M creditor balance — related party vs. third party, maturity profile, and any subordination undertakings
3. Parent's financial strength — obtain consolidated accounts for Wolverhampton Airport Investments Ltd; the guarantee is only as good as the guarantor
4. Outcome of the £900k asset investment — is the leasehold/development activity creating realizable value, or is it stranded cost?
5. Cash runway against the inferred monthly burn rate
6. Any charges registered against the new fixed assets (check the PSC/charges register before assuming security is available)
7. Accounting date changes (Dec → Mar → Jun year-ends) suggest ownership or group alignment shifts — verify stability of the controlling structure