DAVIES GROUP HOLDINGS LTD

Executive Summary

Davies Group Holdings Ltd exhibits a high risk profile due to a substantial decline in net assets and the loss of current assets within one year, raising solvency and liquidity concerns. The company maintains good regulatory compliance and transparent ownership but operates with minimal assets and activity. Further investigation into asset valuations and operational plans is recommended to assess financial stability and sustainability.

DAVIES GROUP HOLDINGS LTD - Analysis Report

Company Number: 13042228

Analysis Date: 2025-07-20 13:02 UTC

1. Risk Rating: HIGH
   This rating is based on the significant and unexplained reduction in net assets from £24,100 in 2023 to only £100 in 2024, coupled with the complete disappearance of debtors from the balance sheet. Such a drastic drop within one year raises concerns about the company's solvency and liquidity.

2. Key Concerns:

• Sharp Decline in Net Assets: Net assets fell from £24,100 to £100 in one year, indicating potential financial distress or asset write-offs.
• Absence of Current Assets in Latest Accounts: Debtors of £24,000 present in 2023 are not reported in 2024, suggesting possible collection issues, write-offs, or reclassification that materially affects liquidity.
• Limited Operational Activity: The company is a holding company with only one employee (the director), minimal fixed assets (£100 investment), and no reported income or turnover data, which raises questions about operational sustainability and cash flow generation.

3. Positive Indicators:

• Compliance with Filing Requirements: The company has filed accounts and confirmation statements on time, with no overdue filings or penalties, indicating good regulatory compliance.
• Clear Ownership and Control: The sole director and 75-100% shareholder is identified, providing transparency in governance.
• Small Company Accounting Standards Applied: Accounts prepared under the small companies regime with no audit required, consistent with company size and activity level.

4. Due Diligence Notes:

• Investigate the reason for the disappearance of debtors and current assets in the 2024 accounts compared to 2023. Clarify whether this reflects cash collection, impairment, or other accounting adjustments.
• Review the nature and recoverability of the £100 fixed asset investment to determine its significance and valuation basis.
• Obtain additional financial information, including profit and loss details, cash flow statements, and any intercompany balances if the company is part of a group structure.
• Assess the company's business model and future strategy to understand how it plans to generate revenues or support its investments given the minimal asset base and operational footprint.