KIAANA MOTORSPORT LTD

Executive Summary

Kiaana Motorsport Ltd exhibits significant liquidity constraints with negative working capital persisting over multiple years, though a recent improvement in net assets is noted. The company remains compliant with filing obligations and maintains a tangible asset base, but its ability to consistently meet short-term liabilities and sustain operations requires further scrutiny. Potential investors should prioritize detailed cash flow and creditor analysis to fully understand solvency risks.

KIAANA MOTORSPORT LTD - Analysis Report

Company Number: 13815341

Analysis Date: 2025-07-20 18:26 UTC

1. Risk Rating: HIGH
   Justification: The company demonstrates a pattern of significant current liabilities exceeding current assets, resulting in negative net current assets for multiple years, indicating liquidity challenges. Although there was a positive swing in net assets in 2024, current liabilities remain substantial relative to current assets and cash balances, posing solvency and cash flow risks.

2. Key Concerns:

• Liquidity Risk: The company’s current assets (£1,698) and cash (£821) as of 2024 year-end are significantly lower than current liabilities (£34,582), resulting in a negative working capital position (-£32,884). This raises concerns about the ability to meet short-term obligations.
• Volatility in Net Assets: The net assets position moved from a negative £4,250 in 2023 to a positive £26,964 in 2024 primarily due to a reduction in current liabilities rather than a material increase in current assets, suggesting reliance on creditor settlements or refinancing.
• Small Scale and Concentrated Control: With only two directors and two PSCs controlling 100% of shares, the company appears closely held, which could amplify operational risks if key individuals encounter difficulties or if there is limited management depth.

3. Positive Indicators:

• Current Status and Compliance: The company is active and up to date with both accounts and confirmation statement filings, indicating regulatory compliance and governance diligence.
• Asset Base: Tangible fixed assets remain stable (£59,848 in 2024), suggesting some capital investment that could support ongoing business activities within the sports sector.
• Turnaround in Equity: The return to positive shareholders’ funds in 2024 after prior years of deficit may reflect improved operational results or restructuring efforts.

4. Due Diligence Notes:

• Investigate the nature and terms of current liabilities, including creditor composition and payment schedules, to assess refinancing risks or potential defaults.
• Review cash flow statements and management forecasts (not provided) to evaluate the sustainability of liquidity improvements and operational cash generation.
• Assess revenue trends and contract pipeline within the "Other sports activities" SIC classification to verify business viability and growth prospects.
• Confirm if there are any contingent liabilities or off-balance-sheet obligations that could affect solvency.
• Examine related party transactions given the close ownership and management structure.