The determinants of the profitability of Malaysian public listed companies

The determinants of the profitability of Malaysian public listed companies

This study explores the determinants of public listed companies’ profitability in Malaysia during the financial crisis period in 2008. Return on assets (ROA) is used as a measurement for company profitability while for independent variables, the company specifics determinants (internal factor) and m...

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Main Author: Ulfana Nisa Adlina,
Format: Thesis
Language:eng
eng
Published: 2015
Subjects:
HG Finance
Online Access:https://etd.uum.edu.my/4662/1/s813062.pdf
https://etd.uum.edu.my/4662/2/s813062_abstract.pdf
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id my-uum-etd.4662
record_format uketd_dc
institution Universiti Utara Malaysia
collection UUM ETD
language eng
eng
advisor Abdul Adzis, Azira
topic HG Finance
spellingShingle HG Finance
Ulfana Nisa Adlina, ,
The determinants of the profitability of Malaysian public listed companies
description This study explores the determinants of public listed companies’ profitability in Malaysia during the financial crisis period in 2008. Return on assets (ROA) is used as a measurement for company profitability while for independent variables, the company specifics determinants (internal factor) and macroeconomic determinant (external factor) are used to determine the company profitability. The company specific determinants are size, liquidity, leverage, and sales growth while for macroeconomic determinant, gross domestic product (GDP) is used. This study utilizes a sample of 161 companies listed in Bursa Malaysia for over the period 2001-2012. All sectors are included in this sample except financial sector because their nature of reporting business is different from the ordinary sectors. The data are analyzed using Ordinary Least Squares (OLS) and fixed effects estimation. The findings show that leverage has a negative and significant relationship with the ROA, implying that companies that have low debt ratio will have higher profit. On the other hand, size, liquidity, and sales growth have a positive and significant relationship with the ROA, indicating that, bigger size companies, highly liquid companies, and companies that able to generate higher sales will have more profits. As for macroeconomic determinant GDP and 2008 dummy are not significant, indicating that the profitability of Malaysian public listed companies is not affected by the economic condition and 2008 global financial crisis.
format Thesis
qualification_name masters
qualification_level Master's degree
author Ulfana Nisa Adlina, ,
author_facet Ulfana Nisa Adlina, ,
author_sort Ulfana Nisa Adlina, ,
title The determinants of the profitability of Malaysian public listed companies
title_short The determinants of the profitability of Malaysian public listed companies
title_full The determinants of the profitability of Malaysian public listed companies
title_fullStr The determinants of the profitability of Malaysian public listed companies
title_full_unstemmed The determinants of the profitability of Malaysian public listed companies
title_sort determinants of the profitability of malaysian public listed companies
granting_institution Universiti Utara Malaysia
granting_department Othman Yeop Abdullah Graduate School of Business
publishDate 2015
url https://etd.uum.edu.my/4662/1/s813062.pdf
https://etd.uum.edu.my/4662/2/s813062_abstract.pdf
_version_ 1747827775788548096
spelling my-uum-etd.46622021-03-18T08:47:56Z The determinants of the profitability of Malaysian public listed companies 2015 Ulfana Nisa Adlina, , Abdul Adzis, Azira Othman Yeop Abdullah Graduate School of Business Othman Yeop Abdullah Graduate School of Business HG Finance This study explores the determinants of public listed companies’ profitability in Malaysia during the financial crisis period in 2008. Return on assets (ROA) is used as a measurement for company profitability while for independent variables, the company specifics determinants (internal factor) and macroeconomic determinant (external factor) are used to determine the company profitability. The company specific determinants are size, liquidity, leverage, and sales growth while for macroeconomic determinant, gross domestic product (GDP) is used. This study utilizes a sample of 161 companies listed in Bursa Malaysia for over the period 2001-2012. All sectors are included in this sample except financial sector because their nature of reporting business is different from the ordinary sectors. The data are analyzed using Ordinary Least Squares (OLS) and fixed effects estimation. The findings show that leverage has a negative and significant relationship with the ROA, implying that companies that have low debt ratio will have higher profit. On the other hand, size, liquidity, and sales growth have a positive and significant relationship with the ROA, indicating that, bigger size companies, highly liquid companies, and companies that able to generate higher sales will have more profits. As for macroeconomic determinant GDP and 2008 dummy are not significant, indicating that the profitability of Malaysian public listed companies is not affected by the economic condition and 2008 global financial crisis. 2015 Thesis https://etd.uum.edu.my/4662/ https://etd.uum.edu.my/4662/1/s813062.pdf text eng public https://etd.uum.edu.my/4662/2/s813062_abstract.pdf text eng public masters masters Universiti Utara Malaysia Akbas, H. E., &Karaduman, H. A. (2012). The effect of firm size on profitability: An empirical investigation on Turkish manufacturing companies. European Journal of Economics, Finance and Administrative Sciences, 55, 21-27. Audretsch, D. B., &Elston, J. A. (2002). Does firm size matter? Evidence on the impact of liquidity constraints on firm investment behavior in Germany. International Journal of Industrial Organization, 20(1), 1-17. Baumol, W. J. (1962). On the theory of expansion of the firm. The American Economic Review, 52(5), 1078-1087. Beekman, A. 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