WILLIAMS TREE WORKS LTD

Executive Summary

Williams Tree Works Ltd is a micro-sized landscaping and forestry support company showing financial recovery with positive net assets after prior losses. However, negative working capital and limited liquidity constrain its ability to comfortably meet short-term obligations. Credit approval is recommended on a conditional basis with close monitoring of cash flow and working capital metrics. The company’s small scale and reliance on a single director require cautious credit risk management.

WILLIAMS TREE WORKS LTD - Analysis Report

Company Number: 13575173

Analysis Date: 2025-07-19 12:40 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Williams Tree Works Ltd is a very small, micro-entity operating in landscape and forestry support services. The company has demonstrated a recent positive turnaround in net assets, moving from a negative equity position in 2023 (-£1,752) to positive net assets of £11,466 in 2024. However, the business still shows significant net current liabilities (£-38,098), indicating ongoing working capital pressure. Given its micro size, limited operational scale (1 employee), and reliance on a single director/shareholder, the company carries moderate risk. Credit approval could be considered with conditions such as monitoring of cash flow, short-term liabilities, and requiring personal guarantees or collateral due to limited financial buffer and liquidity constraints.

2. Financial Strength:
   The balance sheet shows fixed assets of £61,221 (down from £78,520 the previous year), which supports the company's operational capacity. Current assets increased from £9,494 to £25,969, reflecting improved liquidity. However, current liabilities remain high at £64,067, creating a negative working capital position of £-38,098. Long-term liabilities have reduced slightly from £14,777 to £10,457. Overall shareholders’ funds improved to £11,466, indicating the company has generated some retained earnings or capital injection. The balance sheet is thin but trending positively from prior losses.

3. Cash Flow Assessment:
   The negative net current assets suggest that short-term obligations exceed liquid assets, raising concerns about the company's ability to meet immediate liabilities without refinancing or additional capital. The increase in current assets is encouraging but still short of covering current liabilities. Given only one employee/director and limited operational scale, cash flow generation may be constrained. Close scrutiny of cash inflows, receivables collection, and creditor terms is warranted to ensure liquidity is maintained. There is no indication of overdue filings or administration risks, which is positive.

4. Monitoring Points:

• Working capital trends: ongoing net current liabilities could stress cash flow.
• Timely payment record and creditor ageing reports to detect payment delays.
• Profitability trends and retained earnings development in future accounts.
• Any changes in director/director’s financial standing or personal guarantees.
• Business growth indicators such as turnover increases or client diversification.
• Compliance with filing deadlines and absence of legal or regulatory issues.