MANOCAP ENERGY ASSET COMPANY LIMITED

Executive Summary

Manocap Energy Asset Company Limited exhibits improved net asset value and equity support despite prior accounting restatements; however, persistent negative working capital and a short trading history pose liquidity risks. Conditional credit approval is recommended, contingent on close monitoring of cash flow, debtor management, and continued backing by the parent company to ensure debt obligations can be met.

MANOCAP ENERGY ASSET COMPANY LIMITED - Analysis Report

Company Number: 13454387

Analysis Date: 2025-07-20 18:27 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Manocap Energy Asset Company Limited shows signs of financial recovery in the latest year ending March 2024 with positive net assets of £610,754 versus a prior year restated negative position; however, it continues to hold net current liabilities indicating short-term liquidity pressure. The company’s ability to service debt is cautiously supported by tangible fixed assets and shareholder funds, but tight working capital and declining debtor balances warrant close monitoring. The company’s short trading history since incorporation in 2021 and the prior year accounting misstatement highlight some operational risk. Approval for credit facilities should be conditional on improving liquidity and continued operational cash flow generation.

2. Financial Strength:

• Net assets improved to £610,754 in 2024 from a restated £626,002 in 2023, reflecting asset retention after prior misstatement correction.
• Tangible fixed assets of £887,620 represent a significant asset base supporting borrowing capacity.
• Shareholder funds remain positive at £610,754, indicating equity support, although the profit and loss reserve is negative (£677,646), showing accumulated losses.
• The company’s capital structure is reliant on equity from the ultimate parent, Manocap Energy Limited, which controls 100% shares and voting rights, suggesting strong parent backing.

3. Cash Flow Assessment:

• Current liabilities exceed current assets by £276,866, indicating negative working capital and potential short-term liquidity stress.
• Debtors fell significantly to £691,155 from £1,260,666, which may reflect improved collection or reduced sales; however, this reduction impacts cash inflows.
• Bank loans increased moderately to £221,649 but remain low relative to total liabilities, indicating modest gearing.
• The company holds a receivable of £835,118 secured by a charge, which may support cash flow if collectible.
• Overall, liquidity remains constrained; the company needs to improve debtor collection and manage creditor payments to ensure operational cash flow sufficiency.

4. Monitoring Points:

• Track net current assets quarterly to confirm improvement in working capital position.
• Monitor debtor aging and collection turnaround times to mitigate liquidity risk.
• Review any further accounting adjustments or restatements to ensure financial statement reliability.
• Observe profitability trends and cash flow from operations to confirm sustainable debt servicing capability.
• Maintain oversight of the parent company’s support level, given its full ownership and control.