Capital Structure & Firm's Profitability: Petrochemical Sector of KSA

ISBN-13: 9783330048959 / Angielski / Miękka / 2017 / 88 str.

Dalya Bahanshal; Naelah Alkhowaiter; Hanouf Alothman

Opis

This study is exploratory that examines the impact of capital structure on the performance of 14 petrochemical firms listed in Tadawul during period 2011-2014. Previous researches were carried out mostly on firms operating in developed countries and only few studies were made on firms operating in countries characterized by having emerging or transitioning economies such as Saudi Arabia. Data needed for this research were collected from previous researches, companies' financial statements, questionnaires and interview. Simple linear regression was run to examine the relationship between capital structure and firm's financial performance. The capital structure is the independent variable measured by long-term debt to total asset and firm's performance is the dependent variable is measured by EPS, PM, ROA, ROE and PE ratio. Results have lacked consensus from previous researches and based on simple linear regression analysis the researcher concluded that most petrochemical firms have shown a strong negative relationship between LTD and PM and ROA. Major finding showed no relationship between LTD to total assets, EPS and PE-ratio.

O autorze

Dalya Bahanshal with an outstanding GPA got her BBA degree with a finance major from AlYamamah University.She participated in many international and national forums such as the G200 Youth Forum and Undergraduate Research Forum. Currently she is working in a private firm and looks forward to prepare the CFA to enhance her career in the finance field.