DN SERVICE 777 LTD

Executive Summary

DN SERVICE 777 LTD shows an increase in fixed assets accompanied by a sharp rise in long-term liabilities, causing net assets to fall significantly. While the company maintains positive working capital and complies with statutory filings, the leveraged position and minimal equity require cautious credit approval with ongoing monitoring of debt servicing and liquidity. The company’s small size and concentrated ownership suggest limited operational scale but potentially agile management oversight.

DN SERVICE 777 LTD - Analysis Report

Company Number: 13396387

Analysis Date: 2025-07-29 20:02 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DN SERVICE 777 LTD is a small private limited company operating in the construction finishing sector. The company has shown growth in fixed assets but a significant increase in long-term liabilities has reduced net assets drastically from £8,961 in 2023 to £161 in 2024. This raises concerns about solvency and capital structure. While the company remains active and compliant with filing deadlines, the sharp rise in non-current liabilities indicates increased financial risk. Approval is recommended with conditions requiring close monitoring of debt servicing capacity and working capital management.

2. Financial Strength:

• The company’s net assets declined sharply from £8,961 (2023) to £161 (2024), mainly due to the recognition of £22,923 in long-term creditors, which were nil in the prior year.
• Fixed assets increased significantly from £4,040 to £19,952, reflecting recent capital expenditures mainly in motor vehicles.
• Shareholders’ funds are minimal at £161, indicating very low equity buffer against liabilities.
• The balance sheet shows a leveraged position, with total liabilities close to total assets, creating financial fragility.

3. Cash Flow Assessment:

• Current assets reduced from £13,760 to £10,487, with cash balances improving slightly to £4,394, but debtors dropped markedly to £6,093 from £10,170.
• Current liabilities fell from £8,839 to £7,355, resulting in a reduced but still positive net current asset position of £3,132.
• The company appears to maintain positive short-term liquidity; however, the substantial long-term liabilities could pressure cash flows if not properly managed.
• The average employee count is very small (2), suggesting limited fixed overheads, which may support cash flow stability.

4. Monitoring Points:

• Closely monitor the servicing of the £22,923 long-term creditors to avoid liquidity strain or covenant breaches.
• Track changes in net assets and equity levels to assess financial resilience.
• Watch debtor collections and cash flow trends to ensure working capital sufficiency.
• Review capital expenditure plans to avoid further strain on cash resources.
• Monitor director changes and related party transactions given the recent director resignation and ownership concentration.