DLS BUILDING LTD

Executive Summary

DLS Building Ltd is a very small roofing company with limited financial resources and a declining net asset base. While current liquidity is positive, the significant drop in working capital warrants cautious credit exposure. Conditional approval is recommended for low-risk facilities, with close monitoring of liquidity and operational performance.

DLS BUILDING LTD - Analysis Report

Company Number: 13170908

Analysis Date: 2025-07-19 12:53 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DLS Building Ltd is a micro-entity operating in roofing activities with a very small capital base (£100 share capital) and minimal financial resources. The company shows a decline in net current assets and net assets from £1,730 in 2023 to £453 in 2024, indicating a weakening financial position. Although the company remains active with no overdue filings, its small scale, limited resources, and declining net assets suggest some vulnerability. Approval may be considered for low-risk or short-term credit facilities, subject to close monitoring and potential guarantees or security.

2. Financial Strength:
   The balance sheet is very modest, reflecting a micro-sized operation. The net assets have declined significantly over the last year from £1,730 to £453, primarily due to a drop in current assets. Current liabilities have increased slightly. The company has no fixed assets reported, indicating limited investment in long-term resources. Shareholders’ funds match net assets, showing no external equity injections beyond the initial share capital.

3. Cash Flow Assessment:
   Current assets have dropped sharply from £1,799 to £574, impacting liquidity. Nevertheless, net current assets remain positive at £453, which means the company can meet short-term obligations at the balance sheet date. The increase in current liabilities from £69 to £121 is not alarming but should be watched. The company’s working capital level is minimal, suggesting limited buffer for operational cash flow fluctuations. Cash flow stress could arise if receivables are delayed or unexpected expenses occur.

4. Monitoring Points:

• Trend in net current assets and net assets to detect further erosion of financial strength.
• Timeliness of payment to creditors and any increase in overdue payables.
• Changes in share capital or additional funding to support operations.
• Operational performance and contract wins/losses in the roofing sector, which can be sensitive to economic cycles and construction market conditions.
• Director’s engagement and any changes in management or control given the company’s small scale.