D&M CONTRACTS LIMITED

Executive Summary

D&M Contracts Limited is a financially stable micro-entity with strong current asset coverage and positive net assets. The company’s balance sheet and working capital position support credit approval on a conservative basis, given its small scale and limited fixed assets. Continued monitoring of cash flow and profitability is recommended to maintain creditworthiness.

D&M CONTRACTS LIMITED - Analysis Report

Company Number: NI668063

Analysis Date: 2025-07-20 16:09 UTC

1. Credit Opinion: APPROVE
   D&M Contracts Limited demonstrates solid financial stability typical of a micro-entity in the development of building projects sector. The company has maintained positive net assets and shareholders’ funds consistently over the last four years. There are no overdue filings or director disqualifications, and the business is active with directors experienced in the electrical trade, which likely supports operational competence. The absence of employees suggests a lean cost structure, which may reduce fixed overhead risks. Overall, the company appears capable of meeting its short-term obligations and servicing credit facilities, though the small scale and limited asset base mean lending should be cautiously sized.

2. Financial Strength:
   The company’s balance sheet shows a stable net asset position of £96,587 as of the 2024 year-end, slightly down from £98,341 in 2023, indicating minor asset depletion but no material deterioration. Fixed assets are minimal (£2,062) consistent with a service or subcontracting business model. Current assets remain robust at £200,830, providing a strong liquidity buffer. Creditors due within one year decreased to £105,505 from £140,115, which improves short-term solvency. The net current assets (working capital) remain healthy at £95,325, implying the company has sufficient current assets to cover current liabilities comfortably. Share capital is nominal (£100), with equity mainly derived from retained earnings.

3. Cash Flow Assessment:
   The company shows strong net current assets supporting liquidity and working capital needs. The decline in current assets from £238,706 to £200,830 year-on-year suggests some cash or receivables reduction but remains sufficient to cover liabilities. Creditors have decreased, which may reflect good payment discipline or reduced short-term borrowing. No employees indicate low payroll cash outflow. However, absence of detailed profit and loss data or cash flow statements limits precise cash flow forecasting. The company’s ability to generate operating cash flow should be monitored, especially given the modest fixed asset base.

4. Monitoring Points:

• Track annual turnover and profitability trends once full P&L data is available to confirm ongoing operational viability.
• Monitor creditor days and working capital cycle to ensure short-term liquidity remains strong.
• Watch for any increase in liabilities or deterioration in net assets that could signal financial stress.
• Observe any changes in director composition or PSC control that might affect governance or credit risk.
• Review next set of accounts and confirmation statements for timely filing compliance.