MANCHESTER TREES & LANDSCAPES LTD

Executive Summary

Manchester Trees & Landscapes Ltd shows improving financial strength with positive working capital and net asset growth, supported by a single director-owner. While the current liquidity position appears adequate to service short-term obligations, a significant long-term creditor balance warrants cautious credit limits and regular monitoring. Approval is recommended with conditions focused on verifying ongoing cash flow and clarifying the nature of long-term liabilities.

MANCHESTER TREES & LANDSCAPES LTD - Analysis Report

Company Number: 13111450

Analysis Date: 2025-07-29 20:51 UTC

1. Credit Opinion: APPROVE with caution. Manchester Trees & Landscapes Ltd is a micro-entity operating since 2021 with a small asset base and a single director who is also the principal shareholder. The company’s recent financials show a positive turnaround from prior years, with improved net current assets and net assets. However, the company carries a significant long-term creditor balance (£61,129) relative to its net assets (£18,911), indicating some reliance on external financing or deferred liabilities. Given its micro size, limited staff (1 employee), and manageable liabilities, it appears capable of meeting short-term obligations, but credit limits should be conservative and closely monitored.

2. Financial Strength: The balance sheet shows fixed assets of £43,082 and current assets of £66,093 as of January 2024, up from zero current assets in the prior year, indicating a strengthening liquidity position. Net current assets improved from negative £5,549 to positive £50,854, reflecting better working capital management or increased cash/debtors. Total net assets rose from £8,305 to £18,911, demonstrating gradual equity growth. The long-term liabilities have increased to £61,129, which is significant compared to equity but not unusual for a small construction/support services company investing in assets. Overall, the company shows improving financial health but remains vulnerable to liquidity shocks.

3. Cash Flow Assessment: Current assets now cover current liabilities comfortably, suggesting adequate short-term liquidity. However, the absence of detailed cash flow statements means reliance on balance sheet proxies. Positive net current assets and increased accruals/deferred income (£13,896) imply some advance payments or deferred revenue, which may support cash inflows. The company’s micro scale and limited employee count reduce overhead complexity, but operational cash generation capacity should be verified before extending large credit. Close attention is needed on working capital cycles and creditor terms given the sizeable long-term creditor balance.

4. Monitoring Points:

• Liquidity trends: Monitor quarterly updates for sustained positive net current assets and cash balances.
• Long-term liabilities: Clarify nature and repayment terms of the £61,129 long-term creditors to assess refinancing or default risk.
• Profitability and cash generation: Obtain periodic management accounts or cash flow forecasts to confirm ongoing debt servicing ability.
• Director’s financial conduct and commitment: As sole controller, director’s personal financial stability and business engagement are critical.
• Industry risks: Construction and forestry support services can be cyclical; watch for market or regulatory changes impacting revenue stability.