DCD UTILITIES LTD

Executive Summary

DCD UTILITIES LTD, a recently incorporated micro-entity in the construction sector, exhibits a sound financial foundation with positive working capital and equity. While early-stage, the company shows no signs of financial distress and complies with filing requirements, indicating stable financial health. Continued focus on cash flow management and equity growth will support sustainable business development.

DCD UTILITIES LTD - Analysis Report

Company Number: 14760380

Analysis Date: 2025-07-19 12:05 UTC

Financial Health Assessment for DCD UTILITIES LTD

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1. Financial Health Score: B

Explanation:
For a micro-entity incorporated less than two years ago, DCD UTILITIES LTD shows a solid start with positive net current assets and shareholders' funds. The absence of liabilities beyond short-term creditors and the presence of working capital indicate the company is currently financially stable. However, the company's early stage and limited financial history prevent a higher grade. Continued monitoring and growth are essential for sustaining this position.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets	22,641	Cash and short-term assets are sufficient to cover immediate obligations.
Current Liabilities	9,666	Short-term debts are relatively low, manageable within available assets.
Net Current Assets	12,975	Positive working capital ("healthy cash flow") suggests good liquidity to meet short-term needs.
Total Net Assets (Shareholders' Funds)	12,975	Reflects initial capital and retained earnings; indicates company has a positive equity base.
Average Number of Employees	1	Indicates a very small operation, typical for a micro-company in start-up phase.
Account Category	Micro	Simplified reporting but limited financial data available, making trend analysis difficult.
Industry Classification (SIC)	42990	Construction of other civil engineering projects; industry may involve project-based cash flows.

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3. Diagnosis

DCD UTILITIES LTD presents "healthy vital signs" typical of a start-up micro-entity. The company has successfully established positive net current assets, indicating it can cover its short-term liabilities comfortably — a good sign of liquidity and operational stability. The shareholders' funds match net assets, showing no hidden or deferred liabilities.

The single employee and micro-entity status highlight the company's early developmental stage, which naturally limits complexity but also financial history. The construction-related SIC code implies project-based revenue cycles, which can introduce cash flow variability; however, current liquidity buffers mitigate immediate risks.

No signs of financial distress ("symptoms of distress") such as negative working capital, overdue filings, or director disqualifications are present. The company complies with statutory requirements and has timely filed accounts and returns.

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4. Recommendations

• Maintain Strong Cash Flow Management:
  Continue monitoring cash inflows and outflows closely, especially given the construction industry’s project-based nature, to avoid liquidity crunches.

• Build Equity and Reserves:
  As the business grows, aim to increase retained profits or obtain additional capital injections to strengthen the equity base, providing a buffer against unforeseen downturns.

• Plan for Growth and Scaling:
  Consider strategic hiring or subcontracting to manage workload without overextending resources, ensuring operational efficiency.

• Regular Financial Reviews:
  Conduct periodic financial health check-ups to detect early warning signs such as rising liabilities or shrinking assets, ensuring timely corrective actions.

• Prepare for Industry-Specific Risks:
  Given the sector, manage project risks, contract terms, and payment schedules carefully to avoid cash flow disruptions.

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