DAVEY INDEPENDENT TRADER LIMITED

Executive Summary

DAVEY INDEPENDENT TRADER LIMITED has demonstrated a notable financial recovery in the most recent year after several years of negative equity and working capital deficits. While the company remains small and tightly controlled by a single director, current filings are up to date and the business shows signs of operational viability. Further investigation into the sustainability of recent gains and governance arrangements is recommended to fully assess investment risk.

DAVEY INDEPENDENT TRADER LIMITED - Analysis Report

Company Number: 12727535

Analysis Date: 2025-07-20 18:45 UTC

1. Risk Rating: MEDIUM
   The company has shown a significant turnaround in its financial position over the latest year, moving from negative net assets and working capital to a positive net asset position and net current assets. However, the relatively low level of fixed assets and modest current assets, coupled with a small share capital and limited financial history, suggest some vulnerability. The company remains a micro-entity with limited scale, which increases risks related to operational and liquidity fluctuations.

2. Key Concerns:

• Historical Negative Net Assets: For the three preceding years (2021-2023), the company reported negative net assets and net current liabilities, indicating periods of financial stress and potential insolvency risk.
• Modest Share Capital and Limited Equity Cushion: Share capital is minimal (£100), and while net assets improved to approximately £14k in 2024, this remains a thin equity buffer against unforeseen losses or liabilities.
• Concentration of Control and Limited Governance: The company has a single director, Mr Luke Davey, with no identified Persons with Significant Control beyond the director, raising concerns regarding governance, succession, and potential related-party risks.

3. Positive Indicators:

• Recent Financial Improvement: The 2024 accounts show a robust improvement with net current assets of £4,696 and net assets of £13,984, reversing prior losses and indicating a return to operational stability.
• Compliance and Timely Filings: The company’s accounts and confirmation statements are up to date, with no overdue filings or indications of regulatory non-compliance.
• Consistent Employment and Activity: The company has maintained at least one employee, suggesting ongoing operational activity in its manufacturing niche (SIC 31090 - Manufacture of other furniture).

4. Due Diligence Notes:

• Review Underlying Causes of Financial Turnaround: Investigate the drivers behind the sharp improvement in net assets between 2023 and 2024, including any capital injections, asset disposals, or changes in business operations.
• Assess Cash Flow and Working Capital Trends: Examine cash flow statements if available to confirm liquidity improvements and sustainability beyond balance sheet snapshots.
• Governance and Management Structure: Confirm any additional management or control arrangements beyond the single director to evaluate continuity and risk of management concentration.
• Examine Related Party Transactions: Given the director’s sole control, check for any transactions that may pose conflicts of interest or affect financial stability.