DAYSPRING PLACEMENT SOLUTION LIMITED

Executive Summary

DAYSPRING PLACEMENT SOLUTION LIMITED is currently in a financially fragile condition, marked by negative net assets and working capital deficits indicating liquidity and solvency challenges. Immediate actions to improve cash flow, control costs, and recapitalise are recommended to stabilize the business and restore financial health.

DAYSPRING PLACEMENT SOLUTION LIMITED - Analysis Report

Company Number: 12437330

Analysis Date: 2025-07-20 12:16 UTC

Financial Health Assessment: DAYSPRING PLACEMENT SOLUTION LIMITED

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1. Financial Health Score: D

Explanation:
The company shows clear symptoms of financial distress, with persistent negative net assets and working capital deficits over multiple years. Although it remains active and filing on time, the financial "vital signs" reveal a fragile state requiring urgent attention. The score D reflects a company struggling with liquidity and solvency, though not yet insolvent or in formal distress processes.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	2,974	4,461	Modest long-term asset base, slightly reduced in 2024, indicating low capital intensity.
Current Assets	1,559	6,031	Very low liquid assets available; a significant drop in 2024 signals worsening liquidity.
Current Liabilities	12,094	23,403	High short-term debts due within one year; a reduction in 2024 but still substantial relative to assets.
Net Current Assets (Working Capital)	-10,535	-17,372	Negative working capital indicates inability to cover short-term obligations from available liquid assets.
Total Net Assets (Equity)	-7,561	-12,911	Negative equity reflects accumulated losses exceeding capital invested; a key symptom of financial distress.
Number of Employees	1	1	Very small workforce consistent with micro-entity status.
Share Capital	£1.00	£1.00	Minimal share capital; capital base insufficient to absorb losses.

Summary of Vital Signs:
The company’s financial "pulse" shows a dangerously low level of current assets relative to liabilities—a critical liquidity issue. The negative net assets indicate "structural weakness" and that the company is operating with a deficit that has accumulated over time. The reduction in liabilities in 2024 is a mild improvement, but current assets have fallen even more sharply, worsening short-term solvency.

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3. Diagnosis

Underlying Condition:
DAYSPRING PLACEMENT SOLUTION LIMITED is exhibiting classic symptoms of financial strain:

• Liquidity Stress: Negative working capital means the company cannot cover its immediate debts using current assets, akin to a patient whose blood pressure is dangerously low. Without intervention, this may lead to cash flow collapse.
• Capital Erosion: Persistent negative net assets show that losses have eroded shareholder equity, reducing the company’s financial resilience. This is similar to a patient losing muscle mass due to chronic illness.
• Small Scale Operation: With only one employee and micro-entity status, the company likely has limited operational capacity to generate revenue and manage overheads.
• Management Changes: The recent resignation of a director could be a stress factor or response to financial challenges.

Business Outlook:
The company operates in residential care activities for the elderly and disabled—an industry with steady demand but also high operational costs and regulatory compliance burdens. The financial "symptoms" suggest the company may be struggling with either low profitability, cash collection issues, or managing payables.

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4. Recommendations

To return the company to a "healthy" financial state, consider the following:

1. Improve Cash Flow Management:

   • Tighten credit control to accelerate receivables collection.
   • Negotiate extended payment terms with suppliers to ease short-term cash demands.
   • Explore short-term financing options (e.g., overdrafts, invoice financing) to bridge liquidity gaps.

2. Cost Control and Operational Efficiency:

   • Review all operating expenses and eliminate non-essential costs.
   • Consider strategic partnerships or outsourcing to reduce fixed costs.

3. Capital Injection:

   • Raise additional equity to restore positive net assets and provide a financial buffer.
   • Alternatively, consider shareholder loans or convertible debt to improve solvency.

4. Strategic Review:

   • Assess the business model for profitability and sustainability under current market conditions.
   • Consider diversification or service expansion to increase revenue streams.

5. Director and Governance Review:

   • Ensure current management has a clear turnaround plan and strong financial oversight.
   • Engage external advisors if needed for restructuring advice.

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Executive Summary