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.

3. 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.

4. 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.