GURCAY LIMITED

Executive Summary

GURCAY LIMITED is a micro-entity showing early signs of liquidity strain with negative working capital but maintains solvency with modest net assets. The company should prioritize improving cash flow management and increasing capital reserves to prevent financial distress. With focused action, its financial health can stabilize and improve.

GURCAY LIMITED - Analysis Report

Company Number: 13159499

Analysis Date: 2025-07-20 14:39 UTC

Financial Health Assessment for GURCAY LIMITED (As of 30 June 2024)

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1. Financial Health Score: C (Fair)

Explanation:
GURCAY LIMITED shows signs of financial strain, particularly in its working capital management, with net current liabilities indicating potential liquidity constraints. While the company remains solvent with positive net assets, the shrinking asset base and persistent negative net current assets warrant attention. The score reflects a company that is not in immediate danger but exhibits symptoms of financial stress requiring remedial action to avoid deterioration.

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2. Key Vital Signs

Vital Sign	Current Value (£)	Interpretation
Net Current Assets	-342	Negative working capital indicates the company has more short-term liabilities than assets, posing liquidity risk.
Net Assets (Equity)	397	Positive but very low, showing minimal buffer to absorb losses or liabilities.
Fixed Assets	739	Low fixed asset base, typical for micro-entities; indicates limited investment in long-term resources.
Current Assets	5,000	Cash, receivables, and stock available for operations; slightly decreased from prior year.
Current Liabilities	5,356	Increased short-term obligations that must be settled within a year; marginally exceeds current assets.
Share Capital	100	Minimal paid-in capital, common in small private companies.
Trend in Net Assets	397 (up from 221)	Slight improvement in net assets compared to prior year, indicating some retained earnings or asset growth.

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3. Diagnosis: What the Financial Data Reveals

• Liquidity Symptoms: The company shows "symptoms of distress" in liquidity, evidenced by negative net current assets (-£342). This suggests GURCAY LIMITED may face challenges meeting short-term obligations on time without securing additional financing or improving cash inflows.

• Solvency Status: Despite liquidity concerns, the company remains solvent with positive net assets (£397). This "healthy core" indicates that total assets exceed liabilities, but the narrow margin means any significant adverse event could tip the company into insolvency.

• Asset Base & Investment: The fixed asset base is minimal (£739), which is typical for service-oriented micro-entities and consistent with the company's SIC codes in management consultancy and business support activities.

• Working Capital Management: The persistent negative working capital over recent years (2022 & 2023 net current assets were -£703) points to ongoing challenges in balancing receivables, inventory, and payables. The slight improvement in 2024 is encouraging but still insufficient.

• Scale and Growth: The company is very small (micro-entity), with only one employee reported and nominal share capital, indicating a lean operation. Net assets have increased modestly from £221 to £397, which may reflect retained profits or reduced liabilities.

• Governance & Control: Mrs. Ozge Gurcay Odabas holds full control (75-100% shares and voting rights), which can mean swift decision-making but also concentration risk.

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4. Recommendations: Actions to Improve Financial Wellness

• Improve Liquidity: Focus on tightening working capital management by accelerating receivables collection, negotiating longer payment terms with suppliers, or reducing inventory holdings if any. This will help transform negative net current assets into a positive buffer, reducing liquidity risk.

• Cash Flow Planning: Implement detailed cash flow forecasting and monitoring to anticipate periods of tight cash and prepare accordingly (e.g., arranging short-term credit lines).

• Increase Capital Reserves: Consider injecting additional equity or retaining more earnings to build reserves and improve solvency margins, providing a cushion against unforeseen expenses or downturns.

• Cost Control & Profitability: Review operating costs and pricing strategies to improve profitability, which will support stronger working capital and net asset growth.

• Explore Financing Options: If liquidity constraints persist, explore alternative funding such as invoice financing or small business loans to ensure operational continuity.

• Monitor Financial Metrics Regularly: Regularly track key ratios like current ratio, quick ratio, and net asset value to detect early warning signs.

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Medical Analogy Summary

GURCAY LIMITED currently exhibits "symptoms of distress" in its financial "circulatory system" — specifically, a "strained cash flow" and "restricted liquidity." While its "financial heart" (net assets) remains beating, the company is at risk of "circulatory failure" if working capital issues are not remedied. Proactive financial "therapy" focusing on liquidity management and capital strengthening is essential to restore full "financial health."

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