DEXIS DEVELOPMENT LTD

Executive Summary

Dexis Development Ltd exhibits strong liquidity and positive working capital, indicating solid financial health for an early-stage IT consultancy. The company’s cash flow and net assets are improving, reflecting prudent financial management and growing business activity. To ensure sustainable growth, focus should be placed on managing deferred income obligations, expanding operations, and preparing for future regulatory requirements.

DEXIS DEVELOPMENT LTD - Analysis Report

Company Number: 14252701

Analysis Date: 2025-07-20 14:37 UTC

Financial Health Score: B

Explanation:
Dexis Development Ltd demonstrates a solid foundation with positive net current assets, growth in shareholders’ funds, and a healthy cash position. However, being a recently incorporated private limited company with no employees and reliance on deferred income suggests early-stage development rather than a fully mature business. The company is financially stable but should aim to improve working capital management and diversify its revenue sources for sustained growth.

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Key Vital Signs

Metric	2024 Figure (£)	Interpretation
Current Assets	121,464	Increased notably, mainly cash, indicating liquidity.
Cash & Cash Equivalents	110,117	Strong cash buffer, healthy cash flow symptom.
Debtors (Trade Receivables)	11,347	Minor decrease, manageable level of receivables.
Current Liabilities	103,770	Increased, mainly due to deferred income; manageable.
Net Current Assets	17,694	Positive working capital ("healthy circulation").
Net Assets / Shareholders' Funds	19,852	Growth from prior year, indicating retained earnings.
Tangible Fixed Assets	2,158	Minimal fixed assets, typical for IT consultancy.
Deferred Income	46,200	Significant, reflects prepaid client fees (liability).

Additional notes:

• No employees, indicating founder-operated or subcontracted work model.
• No audit required or performed, standard for small company exemption.
• Owner controls 75-100% shares and voting rights, suggesting centralized decision-making.

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Symptoms Analysis

• Liquidity & Cash Flow: The high cash balance relative to liabilities signals excellent liquidity and a strong symptom of healthy cash flow management. This "heartbeat" of the company is robust, enabling it to meet short-term obligations comfortably.

• Working Capital: Positive net current assets reflect the ability to cover short-term debts. The company’s working capital has improved significantly since last year, a sign of growing operational efficiency and financial control.

• Deferred Income as Liability: The large increase in deferred income suggests prepayments by customers for services not yet delivered. While this is a positive sign of future revenue, it also indicates an obligation that must be fulfilled, akin to a "debt" to customers.

• Asset Base: Minimal tangible fixed assets are expected given the software development and IT consultancy nature of the business, where intellectual capital and services dominate.

• Profitability: While the profit and loss account is not publicly filed, the increase in retained earnings (reflected in the rise of shareholders’ funds) suggests the company is generating profits or at least retaining value.

• Company Age and Scale: Incorporated in July 2022 and currently having zero employees, the company is early-stage or possibly a solo-operated consultancy. Growth in assets and equity over two years is promising but the scale is small.

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Diagnosis

Dexis Development Ltd is in a stable and growing financial condition with excellent liquidity, positive working capital, and increasing net assets. The “vital signs” of cash flow and solvency are strong, indicating no immediate financial distress. The high deferred income is a symptom of healthy sales performance with advanced customer payments but requires diligent service delivery to avoid future strain. The company’s small size and lack of employees mean it is likely owner-operated or reliant on contractors, which may limit scalability but also reduces fixed overhead risk.

Overall, the company shows early-stage resilience and prudent financial management, but must continue expanding its operational capacity and diversify revenue sources to sustain growth.

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Recommendations

1. Manage Deferred Income Carefully
   Maintain clear schedules for fulfilling deferred income obligations to avoid customer dissatisfaction or liability build-up. This is akin to managing “debt repayment” to clients.

2. Expand Revenue Streams
   Explore additional contracts or recurring revenue models to reduce dependency on large single prepayments and smooth income flow.

3. Consider Hiring or Outsourcing
   To scale operations beyond the founder, consider hiring or formalizing subcontractor agreements, improving capacity and reducing operational risk.

4. Monitor Working Capital
   Continue to monitor current assets and liabilities closely, ensuring that net current assets remain positive as business scales.

5. Prepare for Audit Thresholds
   As the company grows, anticipate the need for audit and more formal financial controls to satisfy regulatory and stakeholder confidence.

6. Build Tangible and Intangible Assets
   Invest in intellectual property, software tools, or development infrastructure to enhance value creation and competitive advantage.

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