DNA HOUSING SERVICES LTD

Executive Summary

DNA Housing Services Ltd is currently experiencing significant financial distress characterized by persistent negative equity and severe working capital deficits. The company has limited cash reserves and relies heavily on director loans, indicating liquidity challenges. Immediate cash flow management, debt restructuring, and potential equity infusion are critical to stabilizing the company’s financial health and preventing further deterioration.

DNA HOUSING SERVICES LTD - Analysis Report

Company Number: 13115514

Analysis Date: 2025-07-20 14:00 UTC

Financial Health Assessment for DNA HOUSING SERVICES LTD

---

1. Financial Health Score: D

Explanation:
The company exhibits significant financial distress as indicated by persistent net liabilities and negative working capital over the last three years. Despite being operational, DNA Housing Services Ltd shows symptoms of financial strain with net current liabilities exceeding current assets and growing accumulated losses. The absence of positive net assets and sustained negative equity positions the company in a fragile financial state, warranting close monitoring and remedial action.

---

2. Key Vital Signs

Metric	2024 (£)	2023 (£)	2022 (£)	Interpretation
Fixed Assets	275	275	275	Stable but low tangible asset base; minimal investment
Current Assets (Cash)	19	2	2	Extremely low cash reserves; slight improvement in 2024
Current Liabilities	3,216	3,216	3,216	High short-term obligations remain unchanged
Net Current Assets (Working Capital)	-3,197	-3,214	-3,214	Severe working capital deficiency; symptoms of distress
Total Assets Less Current Liabilities	-2,922	-2,939	-2,939	Net liabilities persist; no buffer to absorb shocks
Net Assets (Equity)	-3,372	-2,939	-2,939	Negative equity worsening; shareholder funds eroded
Share Capital	3	3	3	Nominal share capital; minimal equity injection
Director’s Loan Account	3,093	3,093	3,093	Significant related-party financing, indicating external funding reliance

Interpretation:

• Working capital deficit: The company’s current liabilities far exceed current assets, indicating a liquidity crunch and potential difficulty meeting short-term obligations — akin to a patient with low blood pressure risking collapse.
• Negative equity: Accumulated losses have eaten into shareholder funds, signifying ongoing operational losses or write-downs—a chronic illness weakening the company’s financial 'immune system'.
• Cash position: Cash reserves are critically low, though slightly improved in 2024, suggesting fragile liquidity and limited room for maneuver.
• Director’s loan: A sizeable director’s loan account indicates reliance on internal funding, which may be unsustainable long-term without external support or operational turnaround.
• Fixed assets: Minimal fixed assets reflect limited capital investment or asset base to leverage for finance or operational capacity.

---

3. Diagnosis

DNA Housing Services Ltd shows clear symptoms of financial distress. The persistent negative net current assets and net liabilities over multiple years reflect underlying operational and financial challenges. The company’s limited asset base coupled with high liabilities and reliance on director loans indicate a fragile balance sheet structure.

The company’s financial 'vital signs' suggest liquidity constraints and an inability to generate sufficient profits or cash flow to reduce liabilities or rebuild equity. This chronic underperformance threatens its capacity to sustain operations without intervention. The company’s financial health resembles a patient with chronic anemia: low reserves and ongoing strain, requiring urgent treatment to prevent collapse.

---

4. Recommendations

Immediate Actions:

• Cash flow management: Prioritize cash collection, reduce discretionary expenditures, and negotiate extended payment terms with creditors to ease working capital strain.
• Debt restructuring: Engage with creditors and lenders to restructure existing liabilities, including the director’s loan, to stagger repayments and reduce immediate pressure.
• Financial injection: Consider additional equity funding or external investment to strengthen the capital base and improve liquidity.
• Operational review: Conduct a thorough review of business operations to identify cost-saving opportunities and revenue enhancement strategies to restore profitability.
• Regular monitoring: Implement tighter financial controls and monthly cash flow forecasting to detect early warning signs and respond proactively.

Long-term Strategy:

• Explore strategic partnerships or mergers to leverage synergies and expand operational capacity.
• Invest in asset acquisition or technology upgrades that can improve service delivery and market competitiveness once stability is restored.
• Review pricing models and contracts to ensure sustainable margins.

---