MULBERRY CHASE PROPERTIES LTD

Executive Summary

Mulberry Chase Properties Ltd shows asset backing through investment properties and modest growth in net assets but currently suffers from weak liquidity with negative working capital and declining cash reserves. While governance is straightforward under a sole director-shareholder, credit exposure is conditional on the company demonstrating sustainable cash flow and managing short-term liabilities. Close monitoring of liquidity and cash flows is essential to mitigate repayment risks.

MULBERRY CHASE PROPERTIES LTD - Analysis Report

Company Number: 14362838

Analysis Date: 2025-07-29 19:34 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Mulberry Chase Properties Ltd operates in a stable sector of real estate letting with tangible fixed assets (investment property) valued at £176,522. The company is relatively new (incorporated 2022) and shows modest net asset growth from £4,516 in 2023 to £9,043 in 2024. However, current liabilities (£195,251) substantially exceed current assets (cash £27,772), resulting in a negative net working capital (£-167,479). This weak liquidity position raises concerns about short-term cash flow sufficiency to meet immediate obligations. The director is the sole shareholder and appears to have full control, enhancing governance clarity but concentration risk. Credit approval should be conditional on regular monitoring of liquidity and confirmation of an adequate cash flow plan or external funding arrangements.

2. Financial Strength:
   The balance sheet is asset-heavy with £176,522 in investment properties and negligible depreciation. Net assets increased slightly year on year, reflecting retained earnings growth. Nonetheless, the company has significant current liabilities relative to current assets, indicating dependence on longer-term asset realization or external financing to cover short-term debts. Share capital is minimal (£3), suggesting limited equity buffer. Overall, the company’s financial strength is moderate with adequate asset backing but constrained working capital.

3. Cash Flow Assessment:
   Cash holdings have decreased from £64,382 in 2023 to £27,772 in 2024, indicating cash outflows or investment use. Negative net current assets highlight a mismatch between short-term liabilities and liquid assets, implying potential liquidity stress. The absence of employees reduces overhead costs, but the company must ensure rental income or other operating cash inflows are sufficient to service liabilities and operating expenses. Without an income statement, cash flow visibility is limited; caution is warranted until stable positive cash flow is demonstrated.

4. Monitoring Points:

• Liquidity ratios (current ratio, quick ratio) to track improvements in working capital.
• Cash flow statements or management accounts to confirm operational cash inflows.
• Changes in tenant occupancy or rental income impacting revenue stability.
• Director’s capital injections or external funding to support liquidity.
• Timely filing of accounts and confirmation statements to maintain transparency.