DAN CUBITT BUILDING SERVICES LTD

Executive Summary

Dan Cubitt Building Services Ltd is currently financially weak with negative net assets and poor liquidity, raising significant credit risk. The company’s short-term obligations exceed current assets by a large margin, and cash reserves are nil, indicating an inability to comfortably service debt. Given these financial pressures and limited operational history, credit approval is not recommended at this time without substantial improvement in financial health and cash flow management.

DAN CUBITT BUILDING SERVICES LTD - Analysis Report

Company Number: 13585406

Analysis Date: 2025-07-29 15:56 UTC

1. Credit Opinion: DECLINE
   Dan Cubitt Building Services Ltd shows a deteriorating financial position with significant net current liabilities (£34,550 at 31/08/2024) and negative shareholders’ funds (£11,606). The company’s ability to cover short-term obligations is weak, with current liabilities far exceeding current assets. The negative net assets position indicates insolvency risk. The director’s loan account fluctuates but is currently negative, potentially indicating repayment to the director rather than external funding. Combined with the company’s young age and small scale, this raises concerns about its capability to meet debt and credit commitments reliably.

2. Financial Strength:
   The balance sheet reveals tangible fixed assets of £22,944 but these are outweighed by current liabilities of £38,970, leading to negative working capital. Shareholders’ funds have moved from a positive £3,982 (2023) to negative £11,606 (2024), reflecting accumulated losses or write-downs. The company’s net asset position has worsened dramatically in one year. The absence of cash at year-end (£0 cash in 2024 vs £3,657 in 2023) exacerbates liquidity concerns. This financial fragility undermines the company’s resilience to economic shocks or unexpected downturns.

3. Cash Flow Assessment:
   The company’s liquidity is strained. Debtors increased to £4,420, but no cash was held at the balance sheet date, implying poor cash conversion or timing issues. Current liabilities are substantially higher than current assets, resulting in a net current liability position of £34,550, which is unsustainable. The director’s loan account is negative at year-end, suggesting the company repaid funds to the director, potentially impacting available liquidity. Overall, working capital management appears weak, increasing risk of payment delays or default.

4. Monitoring Points:

• Monitor cash balances and cash flow forecasts closely to assess short-term liquidity improvements.
• Track changes in current liabilities, especially bank loans and overdrafts which increased from £12,291 to £23,289 in one year.
• Watch for any director loan account movements that may impact liquidity or signal funding issues.
• Review future filings for profitability trends and whether shareholders’ funds recover from negative territory.
• Assess credit terms with suppliers given current working capital pressures.