E-ISSN 0976-2779 | ISSN 0975-8453
 

Review Article 


Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto.

Abstract
The study aims to estimate and analyze the impact of financial performance on the profitability of pharmaceutical sub-sector companies listed on the Indonesia Stock Exchange (IDX) for the 2014-2018 period. Financial performance is measured by current ratio (CR), fixed asset turnover (FATO), total asset turnover (TATO), and debt to equity ratio (DER), while profitability is measured by return on assets (ROA). The method of data analysis uses a multiple linear regression model of 9 pharmaceutical sub-sector companies selected based on criteria determined in the purposive sampling technique. Based on the results of the study it can be concluded that partially CR, TATO and DER have a negative effect on ROA, while FATO has a positive effect. Simultaneous testing shows that all financial ratios consisting of; CR, FATO, TATO, and DER influence ROA. The results of the research have the implication that in order to improve the performance of the profitability of pharmaceutical companies, the financial manager increases the efficiency of the use of fixed assets, reduces the use of long-term debt, and does not hold current assets for too long because it has an impact on company profits

Key words: Return On Asset, Current Ratio, Fixed Asset Turnover, Total Asset Turnover, and Debt to Equity Ratio


 
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How to Cite this Article
Pubmed Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto. Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia. SRP. 2020; 11(6): 587-597. doi:10.31838/srp.2020.6.89


Web Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto. Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia. http://www.sysrevpharm.org//?mno=117014 [Access: June 20, 2020]. doi:10.31838/srp.2020.6.89


AMA (American Medical Association) Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto. Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia. SRP. 2020; 11(6): 587-597. doi:10.31838/srp.2020.6.89



Vancouver/ICMJE Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto. Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia. SRP. (2020), [cited June 20, 2020]; 11(6): 587-597. doi:10.31838/srp.2020.6.89



Harvard Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto (2020) Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia. SRP, 11 (6), 587-597. doi:10.31838/srp.2020.6.89



Turabian Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto. 2020. Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia. Systematic Reviews in Pharmacy, 11 (6), 587-597. doi:10.31838/srp.2020.6.89



Chicago Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto. "Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia." Systematic Reviews in Pharmacy 11 (2020), 587-597. doi:10.31838/srp.2020.6.89



MLA (The Modern Language Association) Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto. "Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia." Systematic Reviews in Pharmacy 11.6 (2020), 587-597. Print. doi:10.31838/srp.2020.6.89



APA (American Psychological Association) Style

Endri Endri, Lisdawati, Desi Susanti, Luqman Hakim, Sugianto Sugianto (2020) Determinants of Profitability: Evidence of the Pharmaceutical Industry in Indonesia. Systematic Reviews in Pharmacy, 11 (6), 587-597. doi:10.31838/srp.2020.6.89





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