Key Details:
- £1.8m total working capital facility
- Receivables-led structure with term loan overlay
- Full consolidation of short-term debt
- Improved DSCR and working capital headroom
An established business ith approximately £4.5m annual turnover and a strong base of recurring, institutional clients approached Enness to review its existing funding structure.
Despite consistent profitability and clear forward revenue visibility, the business was experiencing increasing pressure on cash flow. This was driven by a combination of short-term borrowing and an overreliance on overdraft facilities, limiting its ability to operate efficiently and reinvest in growth.
The company’s existing funding arrangements included approximately £500,000 in short-term loans, alongside a £250,000 overdraft facility, which created significant monthly repayment pressure and restricted available liquidity.
While the underlying business fundamentals remained strong, the structure of the debt was misaligned with the company’s cash flow profile. Traditional term lending options alone did not provide the flexibility required, particularly given the need for a more dynamic working capital solution.
Previous attempts to refinance had failed to fully address these structural issues, leaving the business exposed to ongoing cash flow constraints and limited headroom.
We structured a circa £1.8m working capital facility, combining a receivables-led finance line (£1.3m) with a £550,000 term loan overlay.
This blended approach enabled the full consolidation of existing short-term liabilities while introducing a scalable funding solution aligned to the company’s revenue cycle. By leveraging receivables finance, the facility allowed the business to access liquidity tied up in outstanding invoices, creating a more responsive and flexible funding structure.
The result was a significant reduction in monthly repayment obligations, accompanied by a meaningful improvement in the debt service coverage ratio (DSCR) and overall financial stability.
Crucially, the new structure provided increased working capital headroom and a funding platform capable of supporting continued growth, allowing the business to focus on operations rather than short-term liquidity pressures.
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