Does London & Associated Properties (LON:LAS) Have A Healthy Balance Sheet?

Warren Buffett famously said, 'Volatility is far from synonymous with risk.' When we think about how risky a company is, we always like to look at its use of debt, since debt overload can lead to ruin. Importantly, London & Associated Properties Plc (LON:LAS) does carry debt. But is this debt a concern to shareholders?

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What Risk Does Debt Bring?

Generally speaking, debt only becomes a real problem when a company can't easily pay it off, either by raising capital or with its own cash flow. In the worst case scenario, a company can go bankrupt if it cannot pay its creditors. While that is not too common, we often do see indebted companies permanently diluting shareholders because lenders force them to raise capital at a distressed price. Of course, plenty of companies use debt to fund growth, without any negative consequences. The first thing to do when considering how much debt a business uses is to look at its cash and debt together.

What Is London & Associated Properties's Net Debt?

The chart below, which you can click on for greater detail, shows that London & Associated Properties had UK£24.4m in debt in June 2025; about the same as the year before. On the flip side, it has UK£3.37m in cash leading to net debt of about UK£21.0m.

How Strong Is London & Associated Properties' Balance Sheet?

According to the last reported balance sheet, London & Associated Properties had liabilities of UK£27.4m due within 12 months, and liabilities of UK£20.6m due beyond 12 months. Offsetting these obligations, it had cash of UK£3.37m as well as receivables valued at UK£5.70m due within 12 months. So its liabilities outweigh the sum of its cash and (near-term) receivables by UK£39.0m.

This deficit casts a shadow over the UK£3.41m company, like a colossus towering over mere mortals. So we definitely think shareholders need to watch this one closely. After all, London & Associated Properties would likely require a major re-capitalisation if it had to pay its creditors today. The balance sheet is clearly the area to focus on when you are analysing debt. But you can't view debt in total isolation; since London & Associated Properties will need earnings to service that debt. So when considering debt, it's definitely worth looking at the earnings trend. Click here for an interactive snapshot.

See our latest analysis for London & Associated Properties

Given it has no significant operating revenue at the moment, shareholders will be hoping London & Associated Properties can make progress and gain better traction for the business, before it runs low on cash.

Caveat Emptor

Over the last twelve months London & Associated Properties produced an earnings before interest and tax (EBIT) loss. Indeed, it lost a very considerable UK£1.6m at the EBIT level. When you combine this with the very significant balance sheet liabilities mentioned above, we are so wary of it that we are basically at a loss for the right words. Like every long-shot we're sure it has a glossy presentation outlining its blue-sky potential. But the reality is that it is low on liquid assets relative to liabilities, and it lost UK£1.7m in the last year. So we think buying this stock is risky. When analysing debt levels, the balance sheet is the obvious place to start. But ultimately, every company can contain risks that exist outside of the balance sheet. Be aware that London & Associated Properties is showing 2 warning signs in our investment analysis , you should know about...

Of course, if you're the type of investor who prefers buying stocks without the burden of debt, then don't hesitate to discover our exclusive list of net cash growth stocks, today.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.