DRAPER DEVELOPMENTS AND RENOVATIONS LIMITED

Executive Summary

Draper Developments and Renovations Limited is an early-stage micro-entity with a positive but minimal net current asset position, indicating basic liquidity but limited financial cushion. The company operates in a capital-intensive real estate sector and currently runs a lean operation without employees. Strengthening working capital and developing operational capacity are key to improving its financial health and ensuring sustainable growth.

DRAPER DEVELOPMENTS AND RENOVATIONS LIMITED - Analysis Report

Company Number: 14866497

Analysis Date: 2025-07-19 12:06 UTC

Financial Health Assessment Report for DRAPER DEVELOPMENTS AND RENOVATIONS LIMITED

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1. Financial Health Score: C

Explanation:
Given the company's status as a newly incorporated micro-entity with limited financial history, the financial health score is moderate. The company shows a positive net current asset position, indicating basic liquidity, but the overall scale of operations and financial buffers are minimal. This score reflects a start-up stage with early signs of financial stability but limited runway and resilience.

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2. Key Vital Signs

Metric	Value	Interpretation
Current Assets	£1,100	Represents cash or short-term assets available to meet liabilities.
Current Liabilities	£1,000	Short-term debts due within one year.
Net Current Assets	£100	Positive but minimal working capital; a basic "healthy pulse" but fragile.
Net Assets / Shareholders Funds	£100	Equity held by shareholders; very low, indicating early-stage capitalisation.
Employees	0	No employees besides directors; lean operation but may lack operational capacity.
Incorporation Date	2023-05-12	Company has been operational for approximately 1 year.
Audit Status	Exempt (Micro-entity)	No audit required, reducing compliance burden but less external assurance.

Interpretation:
The company’s balance sheet shows a positive but very thin margin between current assets and liabilities, which is akin to a patient with a stable but weak heartbeat—there is no immediate distress, but vulnerability to shocks. The absence of employees suggests a very small, possibly owner-operated business, limiting scalability unless addressed.

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3. Diagnosis

• Liquidity: The company maintains a positive working capital (£100), indicating it can currently cover its short-term obligations. However, the margin is minimal and could be easily eroded by unexpected expenses or delayed income.
• Capitalisation: Shareholders’ funds are minimal, showing the company is in an early phase of capital build-up. This means limited financial cushioning against adverse events.
• Operational Capacity: No employees apart from directors suggests a lean setup, likely relying on directors' direct involvement. This is common in micro businesses but may constrain growth and operational flexibility.
• Financial Reporting: Prepared under micro-entity provisions with exemption from audit supports cost efficiency but limits depth of financial scrutiny.
• Business Activity: The SIC code (68209) indicates the company is engaged in letting and operating its own or leased real estate, a sector that can be capital intensive and sensitive to market cycles. Current asset size suggests early stage without significant property holdings yet.

Overall, the company shows the "vital signs" of a start-up with no immediate financial distress but very limited buffer or scale. The financial "symptoms" reveal a fragile but stable condition, heavily reliant on careful cash management and likely owner-driven operations.

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4. Recommendations

• Strengthen Working Capital: Aim to build a more substantial net current asset buffer to ensure resilience against operational delays or unforeseen expenses. This could involve managing payables and receivables tightly or injecting additional equity.
• Develop Revenue Streams: As a property-related business, focus on securing lease agreements or property acquisitions to increase asset base and generate predictable income.
• Consider Staffing Needs: Evaluate if operational demands require hiring or external contractors to avoid over-reliance on directors and support business growth.
• Financial Monitoring: Implement regular cash flow forecasting and budget controls to maintain "healthy cash flow" and avoid liquidity crunches.
• Plan for Growth Capital: Explore funding options such as loans or investor equity to support expansion once the business model is proven.
• Compliance and Reporting: Maintain timely filings and consider periodic financial reviews even if audit exempt, to detect any emerging financial "symptoms" early.

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