D&P CLEANING SOLUTIONS LTD

Executive Summary

D&P CLEANING SOLUTIONS LTD is currently facing liquidity challenges characterized by negative working capital and declining net assets, indicating financial strain typical for micro businesses. While still solvent, urgent attention to cash flow and cost management is necessary to stabilize operations and prevent potential distress. Strategic improvements in financial management and operational efficiency will be critical to restore financial health and ensure sustainable growth.

D&P CLEANING SOLUTIONS LTD - Analysis Report

Company Number: 13889008

Analysis Date: 2025-07-20 14:39 UTC

Financial Health Assessment for D&P CLEANING SOLUTIONS LTD

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1. Financial Health Score: D

Explanation:
The score "D" reflects a company showing symptoms of financial distress, with persistent negative working capital and declining net assets. Although still solvent, the company’s liquidity position is weak, indicating a fragile financial state that requires intervention to restore health.

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2. Key Vital Signs

Metric	2025 Value	Interpretation
Fixed Assets	£9,580	Low fixed asset base typical for micro cleaning service business.
Current Assets	£1,592	Very limited short-term resources to cover immediate obligations.
Current Liabilities	£10,206	Significant short-term debts due within one year.
Net Current Assets (Working Capital)	-£8,614	Negative working capital ("symptom of distress"), risk of liquidity crunch.
Total Assets less Current Liabilities	£966	Marginally positive but sharply reduced from prior year.
Net Assets (Shareholder Funds)	£966	Positive but decreased by over 50% year-over-year, indicating asset erosion.
Average Employees	1	Single-employee operation (director), very small scale.

Interpretation:

• The company is operating with a very tight cash flow ("weak pulse") and insufficient current assets to meet current liabilities, which signals liquidity pressure.
• Shareholders’ funds are positive but have declined substantially, indicating an erosion of the company’s financial "reserve."
• The persistent negative working capital is a red flag for potential cash flow problems and difficulty in meeting short-term commitments.

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3. Diagnosis

D&P CLEANING SOLUTIONS LTD exhibits clear "symptoms of financial strain." The consistently negative net current assets over four years reveal that the company’s short-term liabilities exceed its liquid assets, which is akin to a patient having insufficient blood flow to vital organs. Although the company remains technically solvent with positive net assets, the steep decline from £2,075 in 2024 to £966 in 2025 suggests diminishing financial strength.

The small asset base and minimal employee count reflect a micro business profile, which inherently carries higher volatility and risk exposure from any cash flow disruption. The founder/director is the sole controller, indicating a high dependency on one individual for operational success and financial management.

In summary, the company is vulnerable to liquidity shocks and may struggle to sustain operations without improving working capital and cash reserves.

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4. Recommendations

Immediate Actions:

• Improve Working Capital:
  Implement tighter credit control and accelerate debtor collections to increase current assets. Consider negotiating longer payment terms with suppliers to reduce current liabilities.

• Cash Flow Management:
  Prepare detailed cash flow forecasts to identify upcoming liquidity gaps and plan accordingly. Maintain a cash buffer to avoid operational disruptions.

• Cost Control:
  Review all expenses closely to cut non-essential costs and improve the operational "vital signs."

• Seek External Support:
  Explore short-term financing options such as overdrafts or small business loans to ease liquidity pressure. Engage an accountant or financial advisor to assist with restructuring if necessary.

Longer-Term Strategy:

• Build Financial Reserves:
  Aim to rebuild net assets by generating profits and retaining earnings rather than distributing them.

• Diversify Revenue Streams:
  Explore expanding service offerings or client base to stabilize and increase income.

• Strengthen Governance:
  As a micro entity, consider bringing in additional expertise or advisory support to enhance financial oversight and strategic planning.

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