DENSEMS (HOLDINGS) LIMITED
Company number 00504273 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Credit Analysis: DENSEMS (HOLDINGS) LIMITED
1. Credit Opinion: CONDITIONAL
Rationale: The company presents a substantial asset base with very low leverage, offering strong collateral coverage. However, persistent decline in net assets over multiple years, minimal liquidity, and the illiquid nature of the underlying property assets introduce material uncertainty around cash generation capability. Credit should be extended subject to appropriate security and covenants.
2. Financial Strength
Balance Sheet Summary (FY2025): - Net Assets: £2,160,265 (down from £2,405,302 in FY2024) - Fixed Assets: £2,611,011 (predominantly property, down £329,762 YoY) - Total Liabilities: £44,274 current + £2,667 long-term + £456,088 provisions - Share Capital: £14,000
Key Concerns:
The balance sheet is asset-rich but cash-poor. Fixed assets represent 98% of total assets, reflecting the company's nature as a property holding vehicle. The £456,088 provision (unchanged since at least FY2024) likely represents a deferred tax liability on historical property revaluations, which should be monitored.
Equity Erosion Trend: | Year | Net Assets | YoY Change | |------|-----------|-------------| | 2020 | £2,638,026 | — | | 2021 | £2,551,014 | -£87,012 | | 2022 | £2,562,750 | +£11,736 | | 2023 | £2,429,849 | -£132,901 | | 2024 | £2,405,302 | -£24,547 | | 2025 | £2,160,265 | -£245,037 |
Net assets have declined by approximately £478,000 (18%) over five years. The FY2025 decline of £245,037 is the largest in the review period and warrants investigation. Without a P&L, we cannot determine whether this stems from operating losses, property write-downs, or shareholder distributions.
Leverage Position: Extremely low. Total external debt of £46,941 against net assets of £2.16M yields a debt-to-equity ratio of approximately 0.02:1. This provides substantial headroom.
3. Cash Flow Assessment
Liquidity Position (FY2025): - Current Assets: £52,283 (up from £7,299) - Current Liabilities: £44,274 (down from £76,015) - Net Current Assets: £8,009 (improved from deficit of £68,716) - Cash (FY2023, latest available): £4,514
The working capital position has improved materially, moving from a deficit to a small surplus. However, absolute liquidity remains critically thin. With only £52,283 in current assets against a property portfolio of £2.6M, the company has minimal buffer for unexpected expenditures or void periods on rental properties.
Historical Cash Volatility: Cash has ranged from £4,514 (FY2023) to £170,361 (FY2020), suggesting lumpy cash inflows potentially tied to property transactions or rental receipt timing. This pattern is typical for property holding companies but creates repayment risk on fixed debt service obligations.
Debt Service Capacity: Current liabilities of £44,274 are modest and likely trade-related rather than structured debt. The absence of long-term borrowings suggests the company owns properties unencumbered, which is positive for security but also indicates limited banking relationships.
4. Monitoring Points
| Metric | Current | Risk Threshold | Action |
|---|---|---|---|
| Net assets trend | Declining 18% over 5 years | >25% cumulative decline | Request detailed P&L if threshold breached |
| Net current assets | £8,009 | Deficit position | Require cash flow forecasting |
| Cash position | £4,514 (FY2023) | <£10,000 | Quarterly monitoring |
| Fixed asset values | £2,611,011 | >20% YoY decline | Independent valuation if breached |
| Provisions | £456,088 | Any increase | Clarify nature and trigger events |
Specific Concerns:
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PSC Register Incomplete: The Persons with Significant Control section contains only a generic statement rather than named individuals. This is a compliance gap that should be resolved before extending credit.
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Micro-Entity Filing Limitations: No P&L, no detailed notes, no auditor review. We have no visibility on turnover, operating costs, or rental income. For any facility above £100,000, full accounts should be requested.
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Property Valuation Risk: Fixed assets decreased by £329,762 (11%) in FY2025. As a property company, asset values underpin the credit case. An independent RICS valuation should be obtained for security purposes.
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Director Profile: Multiple directors with family connections (Currier/Lake surnames suggest family ownership). Elizabeth Currier is listed as retired. Ensure active management continuity.
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Future Liability: The £456,088 provision should be investigated. If this represents deferred tax on property gains, crystallisation could significantly impact equity upon disposal.
Recommended Structure: Any facility should be secured by first legal charge over property assets, with loan-to-value not exceeding 50% of independent valuation. Financial covenants should include minimum net assets of £2.0M and positive net current assets. Quarterly information sharing should be mandated.