Company Number: 13288294

Analysis Date: 2025-07-20 15:20 UTC

Financial Health Assessment of DULVERTON CLEANING SERVICES LIMITED

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1. Financial Health Score: D

Explanation:
The company exhibits signs of financial distress, reflected in a significant decline in net current assets and net assets over the most recent year. The drop from £1,651 to £154 in net current assets signals reduced liquidity and working capital, indicating the business may be struggling to cover short-term obligations comfortably. While the company remains active and solvent, this downward trend warrants caution and prompt remedial action.

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2. Key Vital Signs

Metric	2023	2024	Interpretation
Current Assets	£2,001	£504	Sharp reduction in liquid and short-term assets; potential liquidity crunch.
Current Liabilities	£350	£350	Stable short-term obligations; manageable but unchanged burden.
Net Current Assets	£1,651	£154	Drastic decrease; indicates shrinking working capital ("healthy cash flow" weakened).
Net Assets / Shareholders Funds	£1,651	£154	Declining equity base; capital buffer eroding, raising concerns about solvency if trend continues.
Number of Employees	1	2	Small workforce; increase may reflect scaling but adds cost pressure.
Account Category	Micro	Micro	Limited filing requirements; small scale operation.
Share Capital	£1.00	£1.00	Minimal initial equity; typical for micro-entities but limits financial resilience.

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3. Diagnosis

The company's financial "vital signs" show symptoms consistent with early-stage distress. The steep decline in current assets and net assets over a single year suggests that the business has experienced a substantial reduction in its liquidity and capital cushion. This "weak pulse" in working capital can restrict the company’s ability to meet short-term liabilities, invest in growth, or absorb shocks.

Despite stable current liabilities, the shrinking net current assets imply the company may be drawing down its cash reserves or struggling to collect receivables or manage inventory efficiently. The small share capital and limited equity base further reduce its capacity to withstand financial stress.

The increase in employee count, while potentially positive for operations, could be contributing to increased fixed costs at a time when liquidity is tight.

Overall, the financial health resembles a patient with depleted energy reserves: still operational but vulnerable to deterioration without intervention.

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4. Recommendations

1. Improve Cash Flow Management:

   • Prioritize accelerating receivables collection and managing payables prudently.
   • Consider negotiating better payment terms with suppliers to ease cash outflows.

2. Cost Control:

   • Review operational expenses, especially labor costs, to align with current revenue levels.
   • Assess if the increase in staff is translating into proportional revenue growth.

3. Capital Injection:

   • Explore options for fresh equity or short-term financing to rebuild working capital and net assets.
   • Even a small capital infusion can stabilize liquidity and restore confidence.

4. Business Development:

   • Focus on strategies to increase turnover, such as marketing, customer retention, and service diversification.
   • Strengthen client relationships to ensure steady cash inflows.

5. Regular Monitoring:

   • Institute monthly financial reviews to catch early signs of distress and act promptly.
   • Use simple financial dashboards to track cash flow, receivables, and liabilities closely.

6. Professional Advice:

   • Engage with a financial advisor or accountant for tailored cash flow forecasting and restructuring advice.
   • Consider mentoring or support programs aimed at small businesses to enhance financial discipline.

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