Kurumsal Finans ve Strateji Rehberi | Finance & Strategy Insights

One of the most important tools in financial analysis is the Altman Z-Score, which measures a company’s bankruptcy risk. For investors, finance managers, and lenders, this score provides critical insights into a company’s financial stability. In this article, we calculate and evaluate the Altman Z-Score of Ulusoy Un Sanayi ve Ticaret A.Ş. (ULUUN) based on its financial statements as of December 31, 2024.

What is the Altman Z-Score?

Developed by Edward Altman in 1968, this model is primarily used to assess the bankruptcy risk of manufacturing companies. The formula is a weighted combination of five different financial ratios:

Z=1.2×X1+1.4×X2+3.3×X3+0.6×X4+1.0×X5

• X₁: Working Capital / Total Assets
• X₂: Retained Earnings / Total Assets
• X₃: EBIT / Total Assets
• X₄: Market Value of Equity / Total Liabilities
• X₅: Sales / Total Assets

Calculation with 31.12.2024 Data

• Total Assets: 31,676,072,903 TL
• Working Capital (Current Assets – Current Liabilities): 2,254,248,318 TL
• Retained Earnings: 3,720,697,994 TL
• EBIT: 2,436,783,848 TL
• Total Liabilities: 20,349,615,812 TL
• Sales (Revenue): 48,922,492,933 TL
• Market Capitalization (as of 31.12.2024): 4,808,000,000 TL

Ratios:

• X₁ = 0.0711
• X₂ = 0.1174
• X₃ = 0.0769
• X₄ = 0.2363
• X₅ = 1.544

Final Z-Score: Z=0.0853+0.1644+0.2538+0.1418+1.544≈2.19

Interpretation of the Score

• Z < 1.8 → High bankruptcy risk
• 1.8 ≤ Z < 3.0 → Grey zone (moderate risk)
• Z ≥ 3.0 → Safe zone

ULUUN’s year-end 2024 Z-Score of 2.19 places it in the grey zone, indicating that:

• The company is not under high bankruptcy risk, yet it is not fully in the safe zone.
• Strong sales and operating profitability support its financial stability, while leverage and market value weigh on the score.

Strategic Assessment

• Strengths: High sales volume and positive operating profit.
• Areas for Improvement: Debt-to-equity balance and market capitalization growth.
• Investor Perspective: If the Z-Score approaches 3.0, the company would be perceived as lower risk and a more attractive investment alternative.

Conclusion

The Altman Z-Score does not determine a company’s destiny on its own, but it is a valuable tool for measuring financial health. Ulusoy Un’s 2024 results indicate that while the company is not in a risky position, it would benefit from strengthening its capital structure to ensure greater financial security.

Therefore, ULUUN stands as a moderate-risk company with solid operational fundamentals, making it a business to watch closely for both investors and financial institutions.