HERITAGE DAMP SOLUTIONS LTD

Executive Summary

Heritage Damp Solutions Ltd is a small, recently incorporated company showing modest solvency improvements but constrained liquidity and operational capacity. Reliance on director loans and absence of employees present risks that warrant further scrutiny. However, the company maintains good compliance and has strengthened its net asset position in the latest year.

HERITAGE DAMP SOLUTIONS LTD - Analysis Report

Company Number: 13570783

Analysis Date: 2025-07-29 20:24 UTC

1. Risk Rating: MEDIUM
   Heritage Damp Solutions Ltd shows signs of modest improvement in solvency with net current assets turning positive in 2023 after prior years of deficit. However, minimal cash on hand, reliance on director loans, and absence of employees highlight operational and liquidity vulnerabilities typical of a very small or start-up business.

2. Key Concerns:

• Liquidity Constraints: The company reported zero cash at year-end 2023, with current assets mainly comprising debtors, which may delay cash inflows. This raises concerns about the ability to meet short-term obligations without additional director support.
• Director Loans and Related Party Risk: Significant loans from directors (£7,164 at 2023 year-end) indicate dependence on insider financing. Additionally, a bad debt write-off of £6,515 owed by an ex-director signals potential governance or credit control issues.
• Operational Sustainability: The company had no employees during the reporting period, suggesting limited operational capacity or outsourcing reliance, which may affect business continuity and growth potential.

3. Positive Indicators:

• Improved Working Capital: Net current assets improved from a negative £4,819 in 2022 to a positive £294 in 2023, reflecting better short-term financial management or collection of receivables.
• Modest Net Asset Growth: Shareholders’ funds increased from £948 to £2,710, indicating retained earnings or capital injections supporting solvency.
• Compliance and Timely Filings: The company is active, not in liquidation, and has no overdue filings for accounts or confirmation statements, demonstrating regulatory compliance and good governance in this regard.

4. Due Diligence Notes:

• Investigate the nature and aging of debtor balances (£7,563) to assess collectability and actual liquidity.
• Review the terms and sustainability of director loans, including any repayment plans or potential risks if director support ceases.
• Understand the business model given zero employees—determine if services are outsourced or if operations are minimal, and how this impacts revenue generation.
• Examine the circumstances around the write-off linked to the ex-director for potential governance or related party transaction concerns.
• Assess future cash flow projections and the director’s commitment to ongoing financial support to confirm going concern assumptions.