WILLOW TREE PRODUCTION AND SERVICES LIMITED

Executive Summary

Willow Tree Production and Services Limited shows early signs of financial stabilization following initial losses, with a thin but positive net asset position and maintained regulatory compliance. However, limited cash reserves and reliance on director and related party funding present liquidity and operational risks. Further due diligence on cash flows and related party transactions is recommended to clarify financial resilience and sustainability.

WILLOW TREE PRODUCTION AND SERVICES LIMITED - Analysis Report

Company Number: 14062816

Analysis Date: 2025-07-29 15:56 UTC

1. Risk Rating: MEDIUM
   The company has recently transitioned from a net current liability position in 2023 to a marginally positive net current asset position in 2024, indicating some improvement. However, the working capital remains extremely thin (£172), which poses liquidity risk. The company is early in its lifecycle (incorporated 2022) and has a small equity base, which increases vulnerability to operational or cash flow shocks.

2. Key Concerns:

• Liquidity Constraints: Current assets barely cover current liabilities with only £5,332 in cash, limiting operational flexibility and ability to meet short-term obligations promptly.
• Thin Equity and Marginal Net Assets: Shareholders’ funds are minimal at £172, which may limit capacity to absorb losses or invest in growth without additional funding.
• Dependence on Director and Related Parties: The company shows director advances and intercompany balances, which may indicate reliance on insider financing rather than external capital, potentially signaling funding fragility.

3. Positive Indicators:

• Recent Profitability Improvement: The company moved from a significant deficit in retained earnings (-£12,782) to a small positive retained earnings balance (£72), indicating a profitable or breakeven year.
• No Overdue Filings: All statutory accounts and confirmation statements are filed timely, suggesting regulatory compliance and good governance in administrative matters.
• Single Director with Full Control: The sole director and 75-100% shareholder, Mrs Sarada Woods, provides clear accountability and control, which can be advantageous for swift decision-making.

4. Due Diligence Notes:

• Review the company’s cash flow statements and forecasts to assess liquidity management and ability to sustain operations under stress.
• Investigate the nature and terms of the related party transactions and director advances to understand financial dependencies and risk of insider funding withdrawal.
• Examine client contracts, revenue streams, and market positioning within the television and video production sector to evaluate operational stability and growth prospects.
• Confirm the company’s insurance, licensing, and compliance with broadcasting regulations given its SIC codes related to media production.