LDS HOMES LIMITED

Executive Summary

LDS Homes Limited is a micro-entity operating in property letting with a stable asset base but limited equity and negative working capital, indicating liquidity pressure. The company has shown slight equity growth but carries significant long-term liabilities relative to its size. Conditional credit approval is recommended with close monitoring of liquidity and financial leverage metrics.

LDS HOMES LIMITED - Analysis Report

Company Number: 13134022

Analysis Date: 2025-07-29 19:49 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   LDS Homes Limited shows a modest but positive net asset position and incremental growth in equity from £4,019 in 2023 to £6,959 in 2024, indicating some financial improvement. However, the company carries a significant long-term liability (£110,625) relative to its fixed assets (£153,206) and current assets (£10,065). The current liabilities position appears inconsistent in the detailed notes but the balance sheet shows a negative net current asset figure, which suggests working capital pressure. Given the micro-entity scale and limited operating history since incorporation in 2021, credit facilities should be granted with caution, ideally supported by additional collateral or personal guarantees.

2. Financial Strength:
   The balance sheet presents a stable fixed asset base valued at £153,206, unchanged over recent years, which likely represents real estate holdings given the SIC classification in property letting. The company’s net assets have improved slightly over the past two years, indicating retained earnings or capital injection. However, the substantial creditor balance due after one year (£110,625) heavily impacts net asset figures, leaving shareholders’ funds at a low level of £6,959. The company’s small capital base (£100 share capital) and minimal equity cushion limit its financial robustness.

3. Cash Flow Assessment:
   Current assets stand at £10,065 versus current liabilities of £45,687, yielding a negative working capital position of approximately -£35,622. This indicates liquidity constraints that could impair the company’s ability to meet short-term obligations without external support or refinancing. The micro-entity accounts do not disclose profit and loss or cash flow statements, but the static fixed assets and modest increase in net assets suggest limited operational cash generation. The company employs only one employee, indicating low operating costs but also minimal scale to generate substantial cash inflows.

4. Monitoring Points:

• Track changes in current liabilities and working capital to ensure liquidity does not deteriorate further.
• Monitor any additional borrowing or changes in long-term creditor balances that could strain solvency.
• Review any subsequent filings for profit generation or capital injections that improve equity reserves.
• Assess director’s management of cash flow and debt servicing capabilities especially given the micro scale and property-based asset profile.
• Confirm any related party transactions or guarantees that might affect credit risk.