GLOBY earned a healthy profit in 2025 and reached the insolvency register before its accounts were filed

A profitable year, then an insolvency proceeding

GLOBY s.r.o. is a Prague company with the Czech legal form of a limited liability company (s.r.o.). Its accounts for the calendar year 2025 cover the company alone, prepared under Czech accounting standards and stated in Czech koruna. They describe a business that, on paper, was doing well. Revenue reached CZK 162m. Operating profit, what is left after running the business but before interest and tax, came to CZK 21.7m. Net profit was CZK 16.3m.

Those are respectable margins for any trade. The operating margin was 13.4% and the net margin 10.1%. Adding back depreciation and amortisation of CZK 2.6m, the accounting charge that spreads the cost of equipment and other long-lived assets over the years, gives EBITDA of CZK 24.3m, or 15.0% of revenue. Nothing in the income statement looks like a company in distress.

The calendar tells a different story. In mid-October 2026 the Czech insolvency register (ISIR) recorded a proceeding against GLOBY, listed as bankruptcy. Days later, still in October 2026, the 2025 annual accounts were filed in the public collection of documents. The order is unusual: the profitable year became public after the insolvency did.

One line in the balance sheet hints at why the two can sit side by side. At the end of 2025 the company held cash of CZK 868k, against annual revenue of CZK 162m and total assets of CZK 160m.

Why profit and cash can part ways

Profit is an accounting measure. It records revenue when the work is delivered or the goods are shipped, not when the customer pays. It records costs when they are incurred, not when the bill is settled. Over a long enough period profit and cash tend to meet. Over a few months they can be far apart.

A company can report a strong year while its money sits elsewhere. It may be waiting for customers who pay late. It may have bought stock that has not yet been sold. It may have spent cash on equipment, which reaches the income statement only slowly through depreciation. It may be repaying loans, which does not appear in the income statement at all. Each of these turns profit into something other than money in the bank.

The balance sheet shows how GLOBY was financed. Equity, the owners' stake including retained profits, stood at CZK 52.1m, an equity ratio of 32.6%. The rest of the CZK 160m in assets was funded by others: suppliers, lenders and anyone else the company owed. That is not an alarming structure in itself. Many healthy Czech companies run with a similar mix. It does mean that most of what the company held was matched by obligations that would, at some point, need to be paid in cash.

With cash of CZK 868k at the year end, the cushion was thin. A large customer paying late, a lender declining to roll over a facility or a supplier demanding payment in advance can matter more than a year of profit when the bank balance is that low.

Which of these mechanisms applies to GLOBY, the year-end figures do not say. The split of assets between receivables, stock and equipment, and the maturity of what the company owed, would show it. It is also possible that the cause lies entirely in 2026. A balance sheet is a photograph of one day, and much can change in the months after it. The accounts describe the company at the end of 2025; the insolvency proceeding belongs to the autumn of 2026. I would not read the 2025 profit as wrong, and I would not read the insolvency as proof that the accounts hid anything. They answer different questions.

The proceeding itself is still a proceeding. The register entry does not by itself settle how it ends, and nothing here is a forecast of the company's fate.

Where to look in your own company

The pattern is not specific to GLOBY. Owners of profitable companies are often surprised by a cash crunch precisely because the income statement gave them no warning. The income statement is built to measure performance. Survival depends on the cash flow statement and the balance sheet.

These checks are worth doing tomorrow morning.

First, put your net profit for the last full year next to your operating cash flow for the same year. If your accounting system does not produce a cash flow statement, ask your finance team for one. If profit is consistently higher than operating cash flow, money is being absorbed somewhere, and you should know where.

Second, open your list of overdue receivables and sort it by amount. Look at the largest customers and ask how long each has been late, and what your bank balance would look like if the largest one did not pay at all this quarter.

Third, ask for a weekly cash forecast covering the next quarter: opening balance, expected receipts, committed payments, loan repayments and tax. Mark the lowest point. If that low point is close to zero, the profit for the year will not help you on the day a payment falls due. A credit line negotiated in a good month is cheaper than one requested in a bad one.

It also helps to know which of your obligations could become due at short notice. Overdrafts that the bank can withdraw, supplier terms that can be shortened and loan covenants tied to ratios all belong on that list.

GLOBY closed 2025 with a net profit of CZK 16.3m and a bank balance of CZK 868k. Profit says whether the business earns money; cash says whether it can wait for it. The insolvency register does not consult the income statement.