Capital Structure and Financial Performance of Malaysian Construction Firms
| العنوان: | Capital Structure and Financial Performance of Malaysian Construction Firms |
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| المؤلفون: | Taufik Abd Hakim, Hapsah S. Mohammad, Imbarine Bujang |
| المصدر: | Asian Economic and Financial Review. 9:1306-1319 |
| سنة النشر: | 2019 |
| مصطلحات موضوعية: | Variables, Return on assets, Capital structure, media_common.quotation_subject, 05 social sciences, Equity (finance), Monetary economics, Development, General Business, Management and Accounting, Return on equity, Pecking order theory, Debt, 0502 economics and business, Economics, 050211 marketing, Debt ratio, General Economics, Econometrics and Finance, 050203 business & management, media_common |
| الوصف: | This study investigated the impact of capital structure on financial performance of Malaysian construction firms. The empirical data was taken from 41 construction firms listedon the main board of Bursa Malaysia and observed from 2011 to 2015. Capital structure is the financing decision on the proportion between debt and equity. The right proportion leads to optimal capital structure. This study adopts two theories namely trade-off theory and pecking order theory, to explain the concept of optimal capital structure. Capital structure is the independent variable and is measured by short-term debt (STD), long-term debt (LTD), total debt (TD), meanwhile the dependent variable, financial performance, is proxy by return on asset (ROA) and return on equity (ROE). The results indicated positive and significant association between LTD and ROE. However, STD was significant but negatively correlated with ROE. Meanwhile, TD was positive but insignificantly associated with ROE. Nevertheless, STD, LTD and TD were negatively and insignificantly associated with ROA. The findings suggested that financing decisions are influenced by the objective of the firms. If the goal of the firms was to maximize return on asset, the pecking order theory was employed, however if the firms’ objective was to maximize return on equity then the trade-off theory was appropriate to explain the concept of optimal capital structure. The concentration on one industry and the relatively narrow five-year period for data collection were the main limitations of this study. The findings of the research will contribute towards capital structure literature. |
| تدمد: | 2222-6737 2305-2147 |
| الوصول الحر: | https://explore.openaire.eu/search/publication?articleId=doi_________::91e91f617d42fe48989ecb7a47961d2aTest https://doi.org/10.18488/journal.aefr.2019.912.1306.1319Test |
| حقوق: | OPEN |
| رقم الانضمام: | edsair.doi...........91e91f617d42fe48989ecb7a47961d2a |
| قاعدة البيانات: | OpenAIRE |
| تدمد: | 22226737 23052147 |
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