Manolete Partners Reports Strong H2, Forward Book Surges to £67m

Manolete Partners FY26 trading update: strong second half, but one audit risk still hangs over the numbers

Manolete Partners has used this trading update to tell investors that the second half of FY26 came in strongly, just as management had forecast. The headline message is simple enough: trading improved, cash receipts rose, and the forward book jumped to a much bigger £67 million.

That is the good bit. The catch is that there is still an unresolved debtor issue which could lead to a provision of around £1.5 million to £2.0 million, and that matters because the company’s expected Adjusted Realised Profit Before Tax is only £1.9 million before any such hit.

So this is a positive update overall, but not a clean one. Investors have some decent reasons to be encouraged, yet they also need to keep one eye firmly on the audit.

Key numbers from the Manolete Partners RNS that matter most to investors

Metric	FY26	FY25	What it tells us
Realised Revenue	c.£28.0 million	£29.5 million	Slightly down year-on-year, but said to be in line with expectations
Gross cash receipts	£26.6 million	£25.6 million	Cash collection improved by £1.0 million
Net debt	£11.5 million	£11.1 million	Debt edged higher, not lower
Free cash flow	£0.2 million outflow	£0.5 million inflow	Cash generation softened
Forward book	£67 million	£49 million	Up 37%, a major positive for FY27 visibility
New cases signed	£32 million	£26 million	Up 23%, showing stronger pipeline growth
Adjusted Realised PBT	£1.9 million	£0.6 million	Improved materially before any debtor provision

One important caveat: all figures remain subject to audit. That is especially relevant here because of the debtor review.

Why the £67 million forward book is the biggest positive in this Manolete update

The standout number in this release is the forward book rising to £67 million from £49 million. Manolete defines the forward book as the aggregate forecast revenue on live cases, excluding cartel cases.

That matters because Manolete’s model depends on building and monetising a portfolio of insolvency-related claims over time. A bigger forward book does not mean cash in the bank today, but it does give investors more visibility over future revenue opportunities.

The mix also looks stronger. Large cases with a forecast revenue value of more than £0.5 million make up £32 million of the forward book, up from £21 million a year earlier.

In plain English, the company is not just signing more work. It is signing bigger work. If executed well, that can support better revenue and profit in FY27.

Manolete’s FY26 revenue and profit: better second half, but not a blowout year

Realised Revenue for FY26 is expected to be about £28.0 million, compared with £29.5 million in FY25. On the face of it, that is a decline, so this is not a record revenue year.

However, context matters. The company had already flagged that the second half would be stronger, driven by a greater number of higher-value, higher-margin case completions, and it says that is exactly what happened.

The company-compiled consensus before this update was £28.3 million of Realised Revenue and £1.5 million of Realised Profit Before Tax. So the revenue line is a touch below that consensus number, but close enough for management to call it in line with expectations.

More encouragingly, expected Adjusted Realised Profit Before Tax is £1.9 million, versus £0.6 million last year, before any adjustment for the debtor issue. That is a decent improvement and suggests the second-half recovery was real.

The debtor risk in Manolete shares: why £4.7 million exposure is the awkward part

This is the section investors should not skim. Manolete says two delayed payments from a small number of large debtors are still outstanding, and its net exposure to these debtors is about £4.7 million.

The Board says it remains confident that the full amount will be received in due course. That is reassuring, but it is not the same thing as having the cash in hand.

Because the bad debt review has not yet been concluded with the auditors, the company says that if circumstances do not change before the audit finishes, it will consider taking a provision of around £1.5 million to £2.0 million. A provision is an accounting charge recognising the risk that some money may not be collected.

Why does this matter so much? Because against expected Adjusted Realised PBT of £1.9 million, a provision in that range would be significant. It would materially reduce profit and could take a lot of the shine off the year.

This does not mean the business model is broken. It does mean the final audited outcome could look meaningfully different from the headline trading update.

Cash, debt and free cash flow: solid receipts, but not a perfect balance sheet story

Gross cash receipts rose to £26.6 million from £25.6 million, which is a welcome sign. In a litigation and claims-financing business, cash collection is crucial because profits can be lumpy and timing can move around.

That said, net debt increased slightly to £11.5 million from £11.1 million. Free cash flow also moved the wrong way, from a £0.5 million inflow in FY25 to a £0.2 million outflow in FY26.

That is not alarming on its own, especially as the company continued investing in new cases. But it does mean investors should avoid looking only at the forward book and ignoring the balance sheet.

New hires, bigger case signings and leadership changes point to Manolete preparing for growth

Operationally, this looks like a business still leaning into growth. Manolete made three new hires into the legal team, pushed new business development initiatives, and says that helped it sign £32 million of new cases in FY26, up 23% from £26 million.

That is the kind of number I would pay attention to because it helps explain why the forward book has expanded so strongly. It also suggests the company is trying to build a wider and more valuable stream of future work rather than simply relying on existing cases to land well.

There were also leadership changes during the year. Mena Halton became Chief Executive Officer in August 2025, Will Sawyer joined as Chief Financial Officer in December 2025, and Marcia Shekerdemian KC joined the Board as a Non-Executive Director in March 2026.

On the financing side, HSBC waived the requirement for former CEO Steven Cooklin to maintain a minimum shareholding in the company. This is not a major trading driver, but it does remove a specific loan-facility condition and tidies up one potential point of complexity.

What this Manolete RNS means for FY27 and for retail investors considering the shares

The Board says it is confident of increasing Realised Revenue and Realised PBT in FY27, supported by the stronger forward book and what it describes as an improving insolvency market. Based on the numbers in this update, that optimism looks understandable.

If you strip it back, the bullish case is fairly clear. The second half improved, case signings are up, the value of live cases is up sharply, and larger cases now make up more of the pipeline.

The cautious case is also clear. Revenue was still lower year-on-year, free cash flow slipped into outflow, net debt nudged up, and the audit may yet force a meaningful provision against delayed debtor payments.

My read is that this is a genuinely better operational update than last year’s profit number alone might suggest. But until the debtor issue is resolved, investors should probably treat the headline improvement with a bit of discipline rather than full-blown excitement.

In short, Manolete looks to have momentum going into FY27. The growth engine appears to be working. The question is whether the audit lets that story come through cleanly.