DAVID CONNOR LTD

Executive Summary

David Connor Ltd is a small private IT consultancy with a limited trading track record and recent operating losses, reflected in zero turnover at the latest year end. The company has positive net working capital primarily due to high debtor balances, but very low cash reserves present liquidity concerns. Credit should be cautiously extended with close monitoring of cash flow improvements and turnover recovery.

DAVID CONNOR LTD - Analysis Report

Company Number: 13680580

Analysis Date: 2025-07-29 16:57 UTC

Credit Opinion:
CONDITIONAL APPROVAL. David Connor Ltd is a newly established IT consultancy with a very limited trading history and low turnover that has declined to zero in the most recent accounting period. The company shows modest net current assets supported largely by substantial debtor balances, but minimal cash reserves and operating losses in the latest year raise concerns about immediate liquidity and operational sustainability. Credit extension should be limited and contingent on improved cash flow generation and turnover recovery.

Financial Strength:
The latest balance sheet indicates net assets of £74k with current assets of approximately £107k dominated by debtors (£107k) and negligible cash (£6). Fixed assets are minimal (£2.9k). Current liabilities are modest (£36k), resulting in a positive net working capital of approximately £71k. Shareholders' funds are stable but reflect accumulated reserves from prior years with a current year loss of £1.15k. The significant debtor concentration raises questions about collectability and cash conversion efficiency.

Cash Flow Assessment:
Cash on hand is critically low at £6, signaling potential short-term liquidity stress. The large debtor balance compared to minimal cash suggests slow cash inflows or extended credit terms to customers. Operating loss in the latest year indicates the company is not currently generating positive operating cash flow. Working capital remains positive but heavily debtor-dependent, implying risk if collection deteriorates. No director loans or advances outstanding, which is positive for credit risk.

Monitoring Points:

• Turnover and operating profit trends: monitor for recovery from zero turnover and elimination of operating losses.
• Debtor aging and cash collection: ensure timely realization of receivables to support liquidity.
• Cash balances and current liabilities: track for any signs of liquidity crunch or need for external funding.
• Management actions: watch for business development initiatives or cost controls to stabilize operations.
• Filing compliance: current with filings, maintain this to avoid regulatory penalties.