JDC ENVIRONMENTAL CONTRACTORS LTD

Executive Summary

JDC Environmental Contractors Ltd is an early-stage company showing balance sheet growth and asset investment consistent with its waste management activities. However, relatively low cash reserves against rising short-term liabilities and the addition of hire purchase debt present liquidity concerns. The company maintains good compliance with filing requirements, but further due diligence on cash flow and debtor quality is advised to fully assess operational sustainability.

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Company Analysis

This analysis is opinion only and should not be interpreted as financial advice.

JDC ENVIRONMENTAL CONTRACTORS LTD - Analysis Report

Company Number: 13884922

Analysis Date: 2025-07-29 20:08 UTC

  1. Risk Rating: MEDIUM
    JDC Environmental Contractors Ltd shows modest net assets and positive working capital but has a relatively low cash balance and significant short-term liabilities, suggesting potential liquidity pressure. The presence of hire purchase debt increases leverage risk. The company is early in its lifecycle, limiting historical financial data.

  2. Key Concerns:

  • Liquidity Constraints: Cash on hand (£1,839) is very low relative to current liabilities (£69,157), raising concerns about the company's ability to meet immediate obligations despite positive net current assets.
  • Rising Short-Term Liabilities: Current liabilities increased substantially from £47,491 to £69,157 within one year, driven largely by taxation and social security (£37,093), which could indicate tax payment timing or cash flow management issues.
  • Leverage via Hire Purchase Debt: Introduction of £16,528 hire purchase liabilities after more than one year adds to financial commitments, potentially impacting future cash flows.
  1. Positive Indicators:
  • Growth in Net Assets and Working Capital: Net assets more than doubled year-on-year from £4,138 to £8,856, and net current assets improved from £3,316 to £4,996, indicating incremental strengthening of the balance sheet.
  • Asset Investment: Significant increase in tangible fixed assets (plant and machinery) from £1,015 to £20,581 suggests investment in operational capacity aligned with business activities in remediation and waste management.
  • No Filing or Compliance Issues: All statutory accounts and confirmation statements are filed on time, with no overdue filings or indication of regulatory non-compliance.
  1. Due Diligence Notes:
  • Cash Flow Analysis: Obtain detailed cash flow statements or management accounts to assess timing of cash inflows/outflows, particularly related to tax payments and working capital management.
  • Debtors Quality and Collectability: Review ageing and collectability of trade debtors (£43,152) to assess whether receivables are being realised timely.
  • Hire Purchase Terms: Examine the terms, interest rates, and repayment schedule of hire purchase debt to understand impact on future liquidity.
  • Profitability and Revenue Trends: Since income statements are not filed publicly, request P&L data to evaluate operational profitability and sustainability.
  • Directors' Backgrounds: Confirm no adverse regulatory or conduct issues with directors, given they hold significant control and management roles.

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