DPBEAUTYACADEMY LTD

Executive Summary

DPBEAUTYACADEMY LTD is a very small, newly established company with modest but consistent growth in net assets and liquidity. While its current financial position supports a low-risk credit profile, the limited scale and single-person ownership warrant cautious credit extension with careful monitoring of cash flow and operational growth. Credit approval should be conditional on maintaining liquidity and regulatory compliance.

DPBEAUTYACADEMY LTD - Analysis Report

Company Number: 13871792

Analysis Date: 2025-07-20 13:30 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   DPBEAUTYACADEMY LTD is a micro-entity operating in the hairdressing and beauty treatment sector. The company is very young, incorporated in early 2022, and has minimal financial history. It shows modest but steady growth in net current assets and shareholders' funds over the last three years, which indicates some positive momentum. However, the absolute size of its assets and equity remains very low (£4,713 net assets as of January 2025), reflecting limited scale and financial buffer. Given the company’s micro size, single employee, and sole director/shareholder structure, its creditworthiness largely depends on the owner's ongoing commitment and cash management. Extension of credit should be on a cautious basis with limits consistent with the entity's scale and cash generation.

2. Financial Strength:
   The balance sheet shows all current assets with no fixed assets and no long-term liabilities, indicating a simple and low-risk capital structure. Net current assets increased from £1,788 in 2023 and 2024 to £4,713 in 2025, signaling improved liquidity and working capital management. Net assets mirror this trend, increasing steadily, which is positive for financial stability. However, the company’s total asset base is very small, so its capacity to absorb shocks or finance expansion internally is limited. No off-balance sheet liabilities or audit exemptions suggest straightforward reporting and compliance.

3. Cash Flow Assessment:
   Current assets consist mainly of cash or equivalents as no inventory or debtors are reported. Net current assets are positive and growing, indicating the company has sufficient short-term liquidity to meet immediate obligations. The single employee and absence of significant liabilities reduce operational cash demands. However, the limited size means cash flow volatility could pose risks. Close monitoring of cash receipts and payments is advised to ensure ongoing liquidity, especially if the company plans to increase operational scale or incur debt.

4. Monitoring Points:

• Liquidity ratios and working capital trends, to confirm ongoing ability to meet short-term debts.
• Profitability and revenue growth, as this data is currently unavailable but critical for assessing repayment capacity.
• Director’s personal financial support or guarantees, given the small scale and single director ownership.
• Any expansion plans or changes in operational scale that could increase financial risk.
• Timely filing of accounts and confirmation statements to maintain regulatory compliance.