Financial Health Assessment: TENENGE LIMITED

1. Financial Health Score: F

Explanation: This patient is in critical condition. The company is technically insolvent on a group basis with negative equity of £6.2M, sustained massive losses totalling approximately £66.6M over two years at the group level, and is entirely dependent on life support from its parent company (CBPO Overseas Ltd.) to remain a going concern. The company's own loss in 2024 was a staggering £28.9M — nearly 10 times its total assets. This is not a business with a temporary illness; this is a business on financial life support.

2. Key Vital Signs

Blood Pressure — Solvency (Equity Position)

Reading: Dangerously low. The group moved from positive equity of £34.7M in 2022 to negative equity of £6.2M. The accumulated P&L reserve has haemorrhaged from -£46.2M to -£112.8M — a catastrophic bleed of over £66M in just two years. This is the financial equivalent of losing 70% of your blood volume.

Pulse — Cash Flow & Liquidity

Reading: Feeble and irregular. The group has virtually no cash (£86k) against current liabilities of £6.3M. At the company level, there is literally zero cash. The current ratio is deeply negative — for every £1 of current assets, the group owes over £5 in current liabilities. The patient cannot breathe without a ventilator (parent company support).

Heart Rate — Profitability

Reading: The heart has effectively stopped. The company-level loss of £28.9M in 2024 is particularly alarming — this represents a write-off of the investment in subsidiaries (from £28,847k to £0). The group lost £66.5M in 2023 and a further £140k in 2024. There is no revenue generation to speak of — this is an organism that has lost its ability to sustain itself.

Temperature — Asset Quality

*Group current assets only (no fixed assets reported)

Reading: The body is wasting away. The most dramatic symptom is the complete write-off of the company's investment in subsidiaries — from £28.8M to zero. This signals that the subsidiaries' value has been entirely destroyed. Group assets are now just £128k in debtors and cash — a skeleton of the former structure.

3. Diagnosis

Primary Condition: Severe Insolvency with Total Dependency on Parent Support

The clinical picture reveals a company that has suffered a catastrophic financial collapse between 2022 and 2024. The transition from healthy net assets of £34.7M to negative equity of £6.2M represents a systemic failure of the business model.

Key Pathologies Identified:

1. Investment Impairment — The Amputated Limb The company's investment in its subsidiaries was written down from £28.8M to zero in 2024. This is the financial equivalent of a limb that has become gangrenous and required amputation. The underlying subsidiaries (likely Tenenge UK Limited) have proven to be worthless on the balance sheet, suggesting either massive accumulated losses, failed operations, or both.

2. Going Concern — On Financial Life Support The accounts explicitly state the company is a going concern only because: - The immediate holding company (CBPO Overseas Ltd.) has given an undertaking not to recall the £6.177M payable within 12 months - Directors believe cash flow forecasts are sufficient

Remove the parent's ventilator, and this patient cannot survive independently. This is not recovery; this is artificial sustenance.

3. Operational Dormancy — A Comatose Business Despite the strategic pivot in 2023 toward EPC+F (Engineering, Procurement, Construction, and Finance) infrastructure projects, actual operations remain non-existent: - No revenue is being generated - Key projects (Luena-Saurimo Rail and Submarine Interconnector Cable in Angola) are delayed to 2026 and 2027 - The "service agreement" with related company BPC has merely been extended

The business plan exists on paper but not in practice.

4. Odebrecht Legacy — The Pre-Existing Condition The company's history is inseparable from the Odebrecht group, which was at the centre of one of the largest corruption scandals in global history (Operation Car Wash/Lava Jato). The name change from ODEBRECHT SERVICES LIMITED to TENENGE LIMITED in 2020 was a rebranding exercise following this scandal. This historical context casts a long shadow over the company's governance and risk profile.

5. Group Structure Complexity — Weakened Immune System The complex web of related-party transactions (payable to CBPO Overseas Ltd., service agreement with Bento Pedroso Construções S.A.) creates opacity and dependency. The patient's immune system — its ability to withstand external shocks — is compromised by this interdependency.

4. Prognosis

Short-term (12 months): Stable but Critical

The parent company's undertaking provides a temporary reprieve. The company will likely continue to exist as a shell, incurring minimal costs while awaiting the projected 2026-2027 project commencements. However, this is not recovery — it is suspended animation.

Medium-term (2-3 years): Highly Uncertain

The entire business model depends on: - Successfully securing EPC+F projects in Angola - UK Export Finance (UKEF) and export credit agency support materialising - The Odebrecht/CBPO group maintaining its financial support

Any failure in these dependencies could prove terminal. The macroeconomic headwinds noted in the accounts (inflation, interest rates, supply chain volatility, geopolitical instability) add further risk.

Long-term: Guarded at Best

Even if projects commence, the company must first dig out of a £112.8M accumulated loss hole at the group level. The path to profitability is long and uncertain.

5. Recommendations

Immediate — Stabilise the Patient

1. Ring-fence Parent Support: Convert the £6.177M payable to CBPO Overseas Ltd. into a formal long-term loan agreement or equity injection. The current informal undertaking provides insufficient protection for creditors and stakeholders.

2. Cash Conservation: With only £86k in group cash, implement strict cash management protocols. Every expenditure must be justified against the minimal reserves available.

Short-term — Address Underlying Conditions

3. Governance Transparency: Given the Odebrecht legacy and complex related-party relationships, implement enhanced governance and transparency measures. Independent director appointment would improve credibility with potential project financiers.

4. Project Pipeline Validation: Commission an independent assessment of the Angola project pipeline. The repeated delays (now pushed to 2026/2027) require honest evaluation — are these realistic timelines or aspirational targets?

5. Write-down Justification: Provide detailed disclosure to stakeholders explaining the complete write-off of subsidiary investments. What happened to the £28.8M in value? Was this impairment properly timed, or should it have been recognised earlier?

Medium-term — Rehabilitation

6. Revenue Diversification: The current single-project dependency on Angola infrastructure is high-risk. Develop alternative revenue streams or project pipelines to reduce concentration risk.

7. Stakeholder Communication: The gap between the 2022 balance sheet (positive equity) and 2024 (massive negative equity) demands clear communication to any remaining stakeholders about what went wrong and how it will be prevented in future.

8. Consider Orderly Wind-Down: If the EPC+F strategy does not yield tangible contracts by end of 2026, the parent company should consider an orderly wind-down rather than continuing to fund accumulated losses. Prolonging an unviable entity serves neither shareholders nor creditors.

Risk Factors Summary