MANNING HOUSE DEVELOPMENTS LTD

Executive Summary

Manning House Developments Ltd maintains stable working capital and growing asset investment but faces mild financial distress evidenced by negative net equity and very low cash reserves. While operational liquidity is currently adequate, the company’s leverage and reliance on director-secured loans pose risks. Improving cash flow, strengthening equity, and carefully managing debt are key priorities to restore and maintain financial health.

MANNING HOUSE DEVELOPMENTS LTD - Analysis Report

Company Number: 13142097

Analysis Date: 2025-07-20 12:15 UTC

Financial Health Assessment for Manning House Developments Ltd

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1. Financial Health Score: C

Explanation:
Manning House Developments Ltd shows stable asset levels and consistent working capital but has a concerning small negative net asset position in the latest year, indicating a slight imbalance between total liabilities and assets. While the company is not in immediate distress, the negative equity acts like a mild symptom of financial strain that needs addressing.

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2. Key Vital Signs: Critical Metrics and Interpretation

Vital Sign	Value (2025)	Interpretation
Current Assets	£774,372	Healthy short-term assets, mainly stock (property inventory), supporting liquidity.
Cash Balance	£4,671	Very low cash on hand, suggesting tight day-to-day liquidity despite overall current assets.
Current Liabilities	£500,465	Substantial short-term debts close to current asset levels, necessitating careful cash management.
Net Current Assets (Working Capital)	£499,629	Positive working capital indicates the company can cover short-term debts, a good liquidity sign.
Long-Term Liabilities	£500,465	Significant long-term debt secured personally by directors, indicating financial leverage.
Net Assets / Equity	£-836	Negative equity indicates liabilities slightly exceed assets, a warning sign for financial health.
Share Capital	£1	Minimal share capital, typical for small private companies but limits equity buffer.
Turnover	Not disclosed	Unable to assess revenue trends, limiting insight into operational performance.
Employee Count	1	Very small workforce, indicating either a micro operation or heavily outsourced activities.

Additional Notes:

• The stock (property inventory) increased steadily from £562k in 2021 to £770k in 2025, showing ongoing investment in assets.
• Cash is very low compared to liabilities, which is a symptom of constrained liquidity despite positive working capital.
• Long-term debt secured on directors' personal assets at 3.85% interest adds a layer of personal risk and financial burden.

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3. Diagnosis: What the Financial Data Reveals About Business Health

The company exhibits the symptoms of a business with stable operational assets but strained financial structure:

• Healthy working capital ("pulse") indicates the company manages short-term obligations well, suggesting operational stability or at least no immediate liquidity crisis.
• However, the negative net assets ("weak heart") indicate that total liabilities slightly exceed total assets, reflecting accumulated losses or high leverage. This is a red flag that the company is technically insolvent on a balance sheet basis.
• The very low cash reserves ("low blood volume") raise concerns about the ability to meet urgent cash demands or unexpected expenses.
• The long-term debt secured on directors' personal assets ("backbone stress") implies reliance on external funds with personal guarantees, increasing risk exposure.
• The minimal equity base means there is little cushion to absorb financial shocks or losses.
• No turnover data was provided, making it difficult to evaluate profitability or revenue health, which are key "vital signs" for a full diagnosis.

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4. Recommendations: Specific Actions to Improve Financial Wellness

1. Improve Cash Flow Management:
   Boost cash reserves to build a healthy "blood flow" ensuring day-to-day operations are not cash-starved. Consider accelerating receivables, managing payables, or securing short-term financing if needed.

2. Address Negative Equity:
   Explore options to strengthen the equity base—this could include capital injection from shareholders or restructuring debt. Reducing liabilities or increasing assets will improve the "heart condition" of the company.

3. Debt Management Strategy:
   Review the terms and necessity of long-term debt secured on directors' personal assets. Refinancing at better rates or negotiating repayment terms could reduce financial strain and risk exposure.

4. Increase Revenue Transparency:
   Establish clear tracking and reporting of turnover and profitability metrics to identify operational strengths and weaknesses. This will enhance the "diagnostic clarity" for ongoing financial management.

5. Stock Optimization:
   Evaluate the property inventory turnover to ensure stock is not tying up excessive capital unnecessarily. Efficient inventory management will improve liquidity and overall financial health.

6. Professional Financial Review:
   Given the borderline negative net assets and financial leverage, a detailed financial review or business plan update with expert advice would help in early detection and prevention of deeper financial distress.

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