DALSTON CRYSTALS LIMITED

Executive Summary

Dalston Crystals Limited shows significant financial distress with negative working capital and declining net assets over two years, indicating liquidity and solvency challenges. Immediate focus on cash flow management, cost control, and potential capital infusion is critical to stabilize the company’s financial health and support sustainable growth. Without intervention, the financial strain could impair operational viability.

DALSTON CRYSTALS LIMITED - Analysis Report

Company Number: 14280140

Analysis Date: 2025-07-29 18:29 UTC

Financial Health Assessment for Dalston Crystals Limited

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1. Financial Health Score: D

Explanation:
Dalston Crystals Limited exhibits significant financial stress, with persistent net liabilities and negative working capital over the past two years. The company’s financial position shows worsening net assets (from -£10,888 in 2023 to -£21,976 in 2024), indicating increasing accumulated losses. This score reflects a fragile financial state requiring urgent remedial action.

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2. Key Vital Signs

Metric	2024 Value (£)	2023 Value (£)	Interpretation
Fixed Assets	2,779	3,474	Minimal long-term assets; slight decrease
Current Assets	68,598	64,385	Modest short-term resources; improving slightly
Current Liabilities	92,393	78,747	High short-term debts; increasing burden
Net Current Assets (Working Capital)	-23,795	-14,362	Negative; indicates liquidity stress
Total Assets Less Current Liabilities	-21,016	-9,988	Overall asset base insufficient to cover liabilities
Net Assets / Shareholders Funds	-21,976	-10,888	Negative equity; accumulated losses eroding capital

Interpretation of Vital Signs:

• Negative Working Capital ("symptom of distress"): The company’s current liabilities exceed current assets by a significant margin, suggesting difficulty in meeting short-term obligations without additional financing or asset sales.
• Declining Net Assets ("worsening prognosis"): The net liabilities have roughly doubled in one year, indicating ongoing losses or increasing debt.
• Minimal Fixed Assets ("limited collateral"): The company holds very few long-term assets to leverage for funding or security.
• No Employees: The absence of employees implies either a very small operational scale or outsourcing, but also suggests limited internal capacity to generate revenue growth.

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3. Diagnosis

Dalston Crystals Limited is currently in a precarious financial condition marked by chronic liquidity issues and negative equity ("financial illness"). The company’s liabilities outstripping assets and negative working capital are classic "symptoms" of financial distress that could threaten operational sustainability if not addressed.

The increasing gap between liabilities and assets may be due to accumulated losses or rising creditor balances, which could indicate challenges in profitability or cash management. The absence of audit and reliance on micro-entity accounting standards, while permitted, may limit transparency regarding underlying operational performance.

Given its micro-entity status and recent incorporation (2022), the company may still be in an early growth or investment phase; however, the financial indicators suggest it is struggling to achieve a financially sustainable footing.

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4. Recommendations

To improve its financial wellness and return to a "healthy" state, Dalston Crystals Limited should consider the following:

• Liquidity Management:

  • Negotiate extended payment terms with creditors to reduce immediate cash outflows.
  • Accelerate collection of receivables or convert current assets into cash more rapidly.
  • Explore short-term financing options if cash flow gaps persist.

• Cost Control and Revenue Growth:

  • Review and reduce discretionary expenses to conserve cash.
  • Evaluate pricing, marketing, and sales strategies to increase turnover and profitability.

• Capital Structure Review:

  • Consider equity injections from shareholders or new investors to improve net asset position.
  • Avoid accumulating further debt without clear repayment plans.

• Financial Monitoring:

  • Implement regular cash flow forecasting to anticipate liquidity needs.
  • Seek professional advice on restructuring options if losses continue.

• Governance and Transparency:

  • Although audit exemption applies, voluntarily adopting more transparent financial practices can boost stakeholder confidence.

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