Company Number: 14524943

Analysis Date: 2025-07-20 17:45 UTC

Financial Health Assessment Report for HAVEN 2 HOMES CIC

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1. Financial Health Score: B-

Explanation:
HAVEN 2 HOMES CIC demonstrates a stable and improving financial position for a young social enterprise. The company has moved from a net liability position in the previous year to a positive net asset base, showing early signs of financial recovery and operational success. However, the scale of operations remains small, with limited turnover and cash reserves that require cautious management. Overall, the company’s financial health is satisfactory but with room for improvement to ensure sustainable growth.

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2. Key Vital Signs

Metric	2024 Figure	Interpretation
Turnover	£51,741	Start of revenue generation; positive "vital sign" indicating business activity growth.
Operating Profit	£8,519	Profitable operations after expenses, indicating healthy operational control.
Net Assets (Shareholders' Funds)	£5,734	Positive equity reflects financial stability, improved from prior year deficit.
Current Assets (Cash)	£39,741	Healthy cash flow “heartbeat,” sufficient liquidity to cover short-term obligations.
Current Liabilities	£14,007	Manageable short-term debts; working capital positive (£25,734), indicating good liquidity.
Long-term Creditors	£20,000	Debt maturing beyond one year; manageable but should be monitored.
Employees	0	No employees reported; reliance on volunteers or external service providers likely.

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3. Diagnosis

Symptoms Analysis:

• The company has transitioned from loss-making to profitable within the reported 12-month period, reflecting effective cost management and commencement of income generation.
• Positive working capital and cash reserves act like a healthy pulse, ensuring the company can meet short-term liabilities without distress.
• The net asset improvement from negative to positive indicates the company has begun to stabilize its financial "vital signs" and build equity.
• Absence of employees suggests low operational overhead but may limit scalability and service delivery capacity.
• The presence of £20,000 long-term creditors is a "chronic condition" that requires ongoing monitoring to avoid future liquidity strain.
• The company operates in a social care sector focused on mental health and learning disabilities, which often relies on grant funding and public sector contracts, potentially exposing it to funding volatility.

Overall Diagnosis:
HAVEN 2 HOMES CIC is in a recovering but fragile financial state. The company shows clear signs of operational viability and liquidity health but remains at an early stage of financial development with limited revenue and reliance on external funding or guarantees. The balance sheet strength is moderate, with a manageable level of debt and positive net assets.

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4. Recommendations

• Enhance Revenue Streams: Focus on increasing turnover through diversified funding sources such as grants, contracts, and donations to build a stronger financial base.
• Manage Cash and Debt Prudently: Maintain strong cash reserves and monitor long-term creditors to avoid liquidity stress, ensuring timely repayment plans.
• Build Operational Capacity: Consider recruiting employees or committed volunteers to expand service delivery and organizational capacity, facilitating growth.
• Financial Forecasting and Budgeting: Implement regular financial forecasting to anticipate funding gaps and manage expenditure proactively, akin to preventive healthcare.
• Stakeholder Engagement: Strengthen relationships with local councils, healthcare providers, and community organisations to secure sustainable funding and partnerships.
• Governance and Compliance: Continue adhering to filing deadlines and statutory requirements to avoid penalties and maintain stakeholder confidence.
• Risk Management: Identify potential risks linked to funding volatility or sector changes, and develop contingency plans to mitigate financial shocks.

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