DEWI SANT SOLUTIONS LTD

Executive Summary

DEWI SANT SOLUTIONS LTD demonstrates a fragile financial profile with negative equity and inadequate liquidity, raising significant credit risk concerns. The company's balance sheet shows liabilities exceeding assets, and poor working capital metrics signal difficulties in meeting short-term obligations. Without clear cash flow generation or operational scale, credit approval is not recommended at this stage.

DEWI SANT SOLUTIONS LTD - Analysis Report

Company Number: 13538042

Analysis Date: 2025-07-20 16:48 UTC

1. Credit Opinion: DECLINE
   DEWI SANT SOLUTIONS LTD shows a precarious financial position with negative net assets (£-20,544 as at 31 July 2024), indicating liabilities exceed assets. The company’s current liabilities (£213,079) significantly outweigh current assets (£1,016), resulting in a negative net current assets position (-£2,443), which signals potential liquidity issues. This financial stress suggests the company may struggle to meet short-term obligations and repay debt on time. Given the company’s micro-entity size, zero employees, and the nature of its fixed assets (likely property-related), there is limited operational cash flow generation evidence or diversification to support debt servicing. The absence of any audit or additional disclosures limits transparency. The credit risk is elevated due to negative equity and insufficient working capital, recommending against approval of additional credit facilities without strong mitigating factors.

2. Financial Strength:
   The balance sheet is dominated by fixed assets valued around £195k, consistent over recent years, likely representing owned or leased real estate assets per SIC codes. However, current assets are minimal and have declined from £3,736 in 2023 to £1,016 in 2024. Current liabilities are high and increasing, pushing net current assets into negative territory. Long-term creditors exceed fixed assets, causing negative shareholders’ funds and net liabilities on the balance sheet. This weak equity base indicates the company is technically insolvent on a balance sheet basis and reliant on external financing to maintain operations. The lack of employees and limited current assets raise concerns about operational cash flow generation and business resilience.

3. Cash Flow Assessment:
   Working capital is negative, with current liabilities vastly exceeding current assets, indicating liquidity constraints. Minimal cash or equivalents are implied by the low current assets figure. Without employees or operational income disclosed, there is no clear indication of positive cash inflows to cover liabilities. The company’s ability to service short-term debts appears constrained, increasing the risk of payment delays or defaults. Furthermore, the fixed asset base tied up in real estate is generally illiquid, offering limited immediate cash flow support. Overall, the cash flow outlook is weak, and the company likely depends on shareholder funding or refinancing to meet obligations.

4. Monitoring Points:

• Track changes in current liabilities and current assets to detect worsening liquidity.
• Monitor net asset position for signs of recovery or further deterioration.
• Review any changes in long-term debt levels or creditor arrangements.
• Watch for operational developments or additional filings that could reveal cash flow improvements.
• Assess director and shareholder interventions, particularly funding injections or asset disposals.
• Confirm timely filing of accounts and confirmation statements to maintain transparency.