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Fareed, Zeeshan, Zahid Ali, Farrukh Shahzad, Muhammad Imran Nazir, and Assad Ullah. "Determinants of Profitability: Evidence from Power and Energy Sector." Studia Universitatis Babe-Bolyai Oeconomica 61, no. 3 (2016): 59–78. http://dx.doi.org/10.1515/subboec-2016-0005.
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Abstract The study examines the impact of key determinants of profitability of power and energy sector in Pakistan such as firm size, firm age, firm growth, productivity, financial leverage and electricity crisis discussed in the broader inter-disciplinary literature. For this purpose panel data of 16 firms of power and energy sector is taken for 2001 to 2012. The study considers profitability determinants at the firm as well as industry affiliation levels in examining hypotheses developed from resource-based approaches. Random effect model is used to detect the combination of variables that best estimated the impact of the explanatory variables on the dependent variable. The empirical results suggest that firm size, firm growth, and electricity crisis positively impact the profitability. However, firm age, financial leverage and productivity negatively influence the firm profitability. This study also propose that during the electricity crisis the profitability of power sector is increased even production of this sector is very low. The findings further indicate that larger and younger firms with high growth and low productivity are more likely to be profitable. This study has found that firm productivity and firm size are the strongest determinants of profitability in power and energy sector of Pakistan.
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Wieczorek-Kosmala, Monika, Joanna Błach, and Iwona Gorzeń-Mitka. "Does Capital Structure Drive Profitability in the Energy Sector?" Energies 14, no. 16 (2021): 4803. http://dx.doi.org/10.3390/en14164803.
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This paper investigates the factors that determine the profitability of non-listed energy firms from four central European countries: Hungary, Poland, Slovakia, and the Czech Republic. We apply the regression analysis, on a large panel of firm-year observations for the 2015–2019 timespan, to verify the hypothesis on the inversed relationship between leverage and profitability of the companies performing in the energy sector. Our results support the inversed relationship for debt in total and long-term debt, which are consistent with the assumptions of the pecking order theory. However, for short-term debt, we have found a direct relationship, which confirms the assumptions of the trade-off theory of capital structure. Our work contributes to the existing debate on the interplay between financial leverage and profitability, by providing evidence for a large panel of non-listed firms, from a single sector (energy)-oriented perspective.
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Klimenko, Roman, Phaninee Naruetharadhol, and Chavis Ketkaew. "Determinants of Market Players’ Profitability in Thailand’s Energy Sector." International Journal of Interdisciplinary Organizational Studies 13, no. 1 (2018): 27–35. http://dx.doi.org/10.18848/2324-7649/cgp/v13i01/27-35.
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Zimon, Grzegorz, and Dominik Zimon. "The Impact of Purchasing Group on the Profitability of Companies Operating in the Renewable Energy Sector—The Case of Poland." Energies 13, no. 24 (2020): 6588. http://dx.doi.org/10.3390/en13246588.
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Purchasing groups are multi-entity organisations that operate in practically every sector. Their greatest role is to improve the financial situation of small and medium enterprises (SMEs). In the case of enterprises operating in the sectors that are just developing, especially those belonging to SMEs, it is particularly difficult to obtain favourable financial results. In Poland, such sectors include, among others, renewable energy, which is slowly developing, but has not yet reached the size set in climate policy. The purpose of the paper is to present how functioning under group purchasing organisations (GPOs) affects the profitability of companies related to the renewable energy sector. For the example of the largest industry purchasing groups, the analysis showed that high profitability results were achieved by enterprises operating in them compared to entities operating independently in the market. In total, 71 enterprises operating in the sector related to the renewable energy sector in Poland were analysed. The enterprises were divided into units operating in the purchasing groups of 46 enterprises, and those that operate independently in the market of 25 enterprises. The research period covered the years 2016–2019. The analysis showed that the scale effect allowed companies to increase profits and had a positive effect on their financial liquidity. The research proved that in the case of commercial enterprises operating in the sector related to renewable energy, functioning within the industry purchasing group allowed high profitability and financial liquidity. There is a dependency that the liquidity increases with a growth in profitability.
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Chakrabarti, Anindita, and Ahindra Chakrabarti. "The capital structure puzzle – evidence from Indian energy sector." International Journal of Energy Sector Management 13, no. 1 (2019): 2–23. http://dx.doi.org/10.1108/ijesm-03-2018-0001.
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Purpose The purpose of this paper is to determine the factors affecting the capital structure of companies engaged in the Indian energy sector. Design/methodology/approach Capital structure theories and empirical literature have been reviewed to formulate propositions concerning the factors/variables determining the capital structure of Indian energy companies. The examination is done using panel data techniques for the sample 141 companies operating in the Indian energy sector. Findings The results show firms’ age, asset turnover ratio, liquidity and firms’ size to be significant determinants of capital structure for the Indian energy companies, while profitability, debt service capacity, sales growth, non-debt tax shield and tangibility ratio to be insignificant determinants. Historically, profitability has shared a significantly negative relationship with debt ratio; however, the relation here is not significant. Research limitations/implications The focus of the current study is on Indian energy sector, the results obtained will not be applicable for other sectors. Originality/value The current research gives an insight into the determinants of capital structure of the companies engaged in the Indian energy sector, which are mostly overlooked due to the laws, policies and regulations governing the sector as a whole.
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Gawlak, Anna. "Profitability of investment in power distribution industry." E3S Web of Conferences 84 (2019): 02003. http://dx.doi.org/10.1051/e3sconf/20198402003.
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Striving towards improving efficiency in the power sector puts an obligation on distribution companies to seek ways of reducing electricity loss. The highest energy loss in the distribution network is attested in electricity meters, in LV and MV lines and in MV/LV transformers. The paper analyses effectiveness of investment aimed to reduce energy loss in a distribution company. The analysis is carried out with the use of SPBP, IRR and NPV.
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Tewari, Devi D., and V. M. Rao. "Modelling Energy Use in Indian Agriculture: A Sectoral Approach." Vikalpa: The Journal for Decision Makers 14, no. 4 (1989): 29–34. http://dx.doi.org/10.1177/0256090919890405.
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Since 1973, prices of energy and energy related inputs have been rising. Rising prices have brought about structural changes not only in agriculture but also in other sectors of the economy. In this article, Tewari and Rao describe the economic and non- economic aspects of rising energy prices in agriculture. Farmers will have to adopt energy saving technologies in the long run to sustain profitability. The magnitude of changes in the agricultural sector brought about by rising prices can be captured through energy modelling. Tewari and Rao outline the salient features of a sectoral model for Indian agriculture which have implications for several policy measures.
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Niyonsaba, H. H., J. Höhler, J. Kooistra, H. J. Van der Fels-Klerx, and M. P. M. Meuwissen. "Profitability of insect farms." Journal of Insects as Food and Feed 7, no. 5 (2021): 923–34. http://dx.doi.org/10.3920/jiff2020.0087.
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Despite growing interest from entrepreneurs, knowledge on the profitability of commercial-scale insect production is scarce. Insight into the economic figures of insect production is needed by farmers aiming to start insect farms, by banks seeking to provide financing, and by governments planning policy interventions. This review provides an overview of the profitability and underlying economic figures relating to the production of Hermetia illucens, Alphitobius diaperinus, Tenebrio molitor and Acheta domesticus. To enhance data interpretation, we also provide a brief overview of the global insect sector, with specific attention to farm-level operational practices. Sales prices refer to fresh larvae, dried larvae or larvae meal, whereas operational costs include costs for feed, labour, electricity, water and gas. Operational cost components differ per insect species, and therefore the relevant margins are specified for three insect species. The energy, feed, and labour margin for production of H. illucens ranges from € -798 to 15,576 per tonne of dried larvae. The feed and labour margin for production of T. molitor ranges from € 7,620 to 13,770 per tonne of fresh larvae. For production of A. domesticus the feed margin ranges from € 12,268 to 78,676 per tonne of larvae meal. The margin range for A. diaperinus cannot be estimated, due to a lack of data in the literature. The ranges mainly reflect the differences in sales prices, which are found to heavily depend on the geographical market location, type of market (feed or food) and quantity sold. Major operational costs include feed and labour, with feed costs varying substantially within and between insect species. The economic figures and margins presented in this article provide a foundation for the further development of the insect production sector.
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Zimon, Grzegorz, Marek Sobolewski, and Grzegorz Lew. "An Influence of Group Purchasing Organizations on Financial Security of SMEs Operating in the Renewable Energy Sector—Case for Poland." Energies 13, no. 11 (2020): 2926. http://dx.doi.org/10.3390/en13112926.
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European countries are increasingly using renewable energy. Poland is an outsider of such solutions. The Polish energy sector is primarily based on energy produced from coal. However, environmental changes and regulations of the European Union are forcing the increased use of energy from renewable sources. Renewable energy is an industry that is still developing in Poland. At the same time, Poland is a country where the political decisions of the government over the last few years have resulted in a significant limitation of the possibilities of renewable energy development. These actions have also resulted in lowering the profitability of the currently operating renewable energy enterprises, especially those from the sector of small and medium-sized enterprises. An opportunity for SMEs operating in the renewable energy sector is to merge into industry purchasing groups. The aim of the article—and at the same time the research question—is: Is it financially safer for renewable energy companies to operate within purchasing groups compared to companies operating independently in this industry? Traditional ways of purchasing can be transferred to integrated purchasing systems, which will be created by purchasing groups associating renewable energy companies. For this purpose, the financial effects of the implementation and functioning of the purchasing groups in the renewable energy sector in relation to entities operating independently were examined. In the research of renewable energy SMEs, a comparative analysis of key indicators determining the possibility of continuing the activity of these entities was made. The following indicators were examined: current financial liquidity ratio, return on sales, operating cycle, cash conversion cycle, share of receivables in current assets, share of inventory in current assets, turnover ratios, level of receivables, liabilities and profitability. The scientific literature is dominated by studies on purchasing groups in the pharmaceutical and construction industries. Thanks to the research conducted, it has been indicated that the renewable energy industry can also improve its profitability, and thus the possibility of safe continuation of operations by extending the business model to inter-entity cooperation within purchasing groups. Increasing the efficiency of individual entities of the renewable energy industry within purchasing groups becomes particularly important during the COVID-19 pandemic. Statistical analyses and their graphic presentation present the significant impact on the safety and profitability of renewable energy entities in the form of purchasing groups.
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Schwarzbauer, Peter, and Martin Braun. "Auswirkungen von Nutzungsrestriktionen auf die Wertschöpfungskette Holz – Beispiel Österreich." Schweizerische Zeitschrift fur Forstwesen 168, no. 1 (2017): 41–48. http://dx.doi.org/10.3188/szf.2017.0041.
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Impacts of harvest reductions on the value-added wood chain – the case of Austria Wooden biomass availability and the possibility of a scarcity due to a potential harvest reduction are of crucial importance to the Austrian forest-based sector but also relevant for decision makers in environmental policy. The simulation model of the Austrian forest-based sector (model: “Forst- und Holzwirtschaft”, FOHOW) was used to simulate two independent scenarios with harvest reduction in forests available for wood supply (FAWS). In one scenario the reductions are implemented on FAWS of “average” profitability, in the other scenario the reductions take place on FAWS with “poor” profitability. On the one hand, the aim of the study was the analysis of the impacts of reduced wood supply on the value-added wood chain until 2025, on the other hand the impact intensities of the two scenarios have been compared. In general, a harvest reduction resulting in less wood supply has a negative impact on the Austrian forest-based sector. While forestry and the sawmill industry suffer more from a harvest reduction in FAWS with average profitability (because of the lower supply of coniferous roundwood), a harvest reduction in FAWS with lower profitability would affect the panel and paper industry as well as the wood-based energy sector more negatively; reduced harvests in these forest areas would mainly reduce the supply of non-coniferous wood. This, in turn would fuel the competition between the use of wood for materials vs. energy and push pulp- and fuelwood prices up.
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Nylund, Petra A., Nuria Arimany-Serrat, Xavier Ferras-Hernandez, Eric Viardot, Henry Boateng, and Alexander Brem. "Internal and external financing of innovation." European Journal of Innovation Management 23, no. 2 (2019): 200–213. http://dx.doi.org/10.1108/ejim-09-2018-0207.
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Purpose Successful innovation requires a significant financial commitment. Therefore, the purpose of this paper is to investigate the relation between internal and external financing and the degree of innovation in European firms. Design/methodology/approach An empirical investigation is carried out using a longitudinal data set including 146 large, quoted, European firms over ten years, resulting in 1,460 firm years. Findings The authors find that only firms in the energy sector will be more innovative when they are profitable. For the sectors of basic materials, manufacture and construction, services, financial and property services, and technology and telecommunications, profitability is negatively related to innovation. External financing in the form of debt reduces the focus on innovation in profitable firms. Research limitations/implications The authors analyze the findings through the lens of evolutionary economics. The model is not valid for firms in the consumer-goods sector, which indicates a need for adapting the model to each sector. We conclude that the impact of profitability on innovation varies across sectors, with debt financing as a moderating factor. Originality/value To the best of authors’ knowledge, this is the first study that analyzes the internal and external financing and the degree of innovation in European firms on a longitudinal basis.
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Szpulak, Piotr, Szczepan Paszkiel, Stanisław Wawrzyniak, and Mirosław Gryszpiński. "INVESTMENT PROFITABILITY ANALYSIS OF AN ON-GRID PHOTOVOLTAIC SYSTEM." Informatics Control Measurement in Economy and Environment Protection 7, no. 2 (2017): 36–39. http://dx.doi.org/10.5604/01.3001.0010.4835.
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The potential of the solar energy sector is starting to become increasingly important. The possibility to produce electrical power for household needs, as a result of an investment in photovoltaics is gaining popularity, and storing its surplus in a power grid and settlement of its consumption on the basis of an annual balance, allows to limit electricity bills to the minimum. The implementation stage, which promotes investing in solar renewable energy for own household needs was introduced by the new Act on RES, promoting the prosumer On-Grid system. The paper focuses on presenting the analysis of profitability of installing photovoltaic On-grid systems.
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Westerman, Wim, Adri De Ridder, and Marijn Achtereekte. "Firm performance and diversification in the energy sector." Managerial Finance 46, no. 11 (2020): 1373–90. http://dx.doi.org/10.1108/mf-11-2019-0589.
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PurposeThe study aims to fill a gap in the literature on the economic impact of industrial and international diversification on firm performance in the energy sector. Li et al. (2016) investigate firms listed in China, and this study analyzes firms listed in (Western) Europe.Design/methodology/approachA sample of 129 energy firms is extracted from Datastream and covers the period from January 2009 to December 2015. Univariate and multivariate regression analyses are used to determine a plausible relation of diversification on corporate performance. Also, the difference between renewable energy firms and conventional energy firms is explored.FindingsA univariate analysis using both return on assets and Tobin's Q as a variable shows that renewable energy firms have a higher profitability than conventional energy firms. However, a multivariate analysis does not confirm this result. The authors also document a negative relation between diversification strategies and firm performance.Research limitations/implicationsThe study uses main industry codes. Yet, one might make a distinction between renewable energy and conventional energy amounts with corporations. Also, the authors cover financial crisis years. Researchers might take into account more recent years.Practical implicationsThe findings of the study highlight the importance of short-term and long-term considerations for practitioners related to demand, the energy mix, oil prices and firm strategies.Originality/valueThe authors contribute to the debate and the literature when identifying similarities and differences between conventional energy firms and renewable energy firms in their application of diversification strategies and their (relation to) firm performance.
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Taylor, Miranda. "Our energy future: the power of collaboration to transform Australia's energy resources sector." APPEA Journal 57, no. 2 (2017): 552. http://dx.doi.org/10.1071/aj17014.
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After decades of sustained economic growth, Australia is experiencing declining productivity, accelerating technological change and disruption. At the same time, the energy sector is emerging from a massive investment phase, while facing its own perfect storm of disruptive challenges. The industry must navigate these challenges to remain globally competitive. Continuing old practices is a sure pathway to stagnation and decline; we must urgently find different ways to do things. Global benchmarking of the Australian energy resources sector, undertaken recently on behalf of NERA, indicated substantial room to improve the efficiency and productivity of the sector. The report outlines more than AU$5 billion of value through improvements across the following four key areas: supply chain, research and innovation, workforce and regulatory reform, and collaboration is the key. Over the past 24 months, Australian energy-resource companies have focussed on lowering capital cost and improving profitability through efficiency, ensuring the industry has the fundamentals needed to be globally competitive. However, transformational change is needed if the sector is to survive and thrive in this age of innovation and disruption. Further, Australia’s energy resources marketplace is too small to focus only internally. Industry, suppliers, innovators and knowledge experts must collaborate locally, forming connections to access the global marketplace. The size of the prize is significant for everyone. The Australian energy resources sector has the potential to continue to meet the regions energy-resource needs for many years, generate substantial revenue for the nation and grow an export-orientated service and technology sector.
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Bambang Setiawan, Muhammad Ayip Fathani, Erry Rimawan, Antonius Setyadi,. "ANALYSIS OF THE IMPACT OF ELIMINATION EIGHT MAJOR LOSSES IN CO-GENERATION POWER PLANT TO INCREASE PROFITS IN THE PULP & PAPER MILLS MANUFACTURING INDUSTRY." Psychology and Education Journal 57, no. 9 (2021): 6574–83. http://dx.doi.org/10.17762/pae.v57i9.3482.
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In the industrialized world, increasing productivity and profitability is very important for companies as a benchmark of success in business processes. Some literature has defined the success factor of the successful application of the concept of TPM as a tool to improve the productivity performance of the company, therefore improving the productivity performance of the company becomes the main thing in improving long-term sustainable profitability for the company .
 In the manufacturing industry pulp and paper mills, the contribution of the highest production costs is in raw materials (Pulp and chemical raw materials), followed by energy and packaging. The energy sector occupies the top three in the cost contributor to variable costs, it is triggered because in the pulp paper industry sector, the consumption value for electrical energy and heat is very high. Therefore, success in eliminating eight major losses is a major success factor in improving the profitability of the company.
 To analyze the effects of elimination of eight major losses, reduction of production costs and increase in profitability can be solved by evaluating the influence of all indicators of eight major losses using PLS-SEM. The data used is operational data co-generation plant production of PT. XYZ in 2019.
 From the research conducted it is known that the variable Overall Plant Effectiveness (OPE) is significantly influenced by 2 (two) of the 3 (three) constituent indicators, namely Availability and Performance, both indicators affect: Productivity Improvement, Decreased Production Costs and Increased Profitability of the Company. The priority of improvement that must be done by considering the production cost performance data from the review of variable costs of energy is elimination: Loss Shutdown losses (A1), Loss Production adjustment loss (A2), Equipment failure (A3), Process failure ( A4), Normal Production (A5), and abnormal production (A6).
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ASAD, MUZAFFAR, and HASSAN QADEER. "COMPONENTS OF WORKING CAPITAL AND PROFITABILITY: A CASE OF FUEL AND ENERGY SECTOR OF PAKISTAN." Paradigms 8, no. 1 (2014): 41–51. http://dx.doi.org/10.24312/paradigms080104.
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Zieliński, Mariusz, and Izabela Jonek-Kowalska. "Does CSR Affect the Profitability and Valuation of Energy Companies? An Example from Poland." Energies 14, no. 12 (2021): 3668. http://dx.doi.org/10.3390/en14123668.
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The article refers to the issues of financial profitability of undertaking CSR activities, which is widely reported in literature. The four largest electricity producing companies in Poland were selected for the analysis. The research period covers the years 2009–2019, when the index of socially responsible companies was operating on the Warsaw Stock Exchange. The main purpose of the article is to compare the profitability ratios and quotations of energy companies in Poland declaring themselves socially responsible with companies of the same sector that have not expressed such a declaration. The results obtained on the basis of descriptive statistics, concerning profitability ratios and stock market quotations, indicate no relationship between their level and stability and the companies’ declarations of compliance with social responsibility. Companies declaring themselves socially responsible were placed in the ranking between the results of companies that did not belong to the indicated index. This may be the result of the specific situation of energy companies in Poland.
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Wasilewski, Mirosław, and Robert Stolarski. "Determinanty i tendencje zmian efektywności ekonomicznej Colian S.A. na tle ogółu przedsiębiorstw przemysłu spożywczego w Polsce." Zeszyty Naukowe SGGW - Ekonomika i Organizacja Gospodarki Żywnościowej, no. 123 (October 28, 2018): 101–15. http://dx.doi.org/10.22630/eiogz.2018.123.25.
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The subject of the study undertaken was determination of relations between the level and structure of costs and the economic efficiency of the company of Polish food production sector, using the case study of Colian joint-stock company. The study adopted aggregated data of the prices and costs level, the profitability indicators of revenue of assets (ROA), the economic viability of sales (ROS), the net value added, and data from periodic reports on the structure of costs by comparative cost system. The level of costs in the sector and in the company increased, despite the decrease in the share of costs of materials and energy, wages and salaries, social security and other benefits, depreciation as well as taxes and fees in the cost structure. The rate of decline in the operating profitability of assets, the economic profitability of sales and the level of value added at enterprise was lower than the increase in the level of costs, which may result from non-operational activities.
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Malinic, Dejan, and Vlade Milicevic. "The financial and structural capabilities of key infrastructure sectors in Serbia." Ekonomski anali 57, no. 195 (2012): 7–42. http://dx.doi.org/10.2298/eka1295007m.
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Experts and economic policy creators debate various economic growth rates without a direct insight into the capabilities of the different economic sectors motivated us to devote this paper to the research of key infrastructure sector capabilities, both in terms of the economic prosperity of the Serbian national economy and as a support for the development of other sectors. This paper examines the energy, transportation, and telecommunications sectors? exposure to short-term and long-term risks, and assesses their financial strength, investment possibilities, and long-term profitability. We believe that the following results will be a valuable information input for making better strategic decisions and more expedient planning of economic sustainable growth.
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Yue, Peng, Yaodong Fan, Jonathan A. Batten, and Wei-Xing Zhou. "Information Transfer between Stock Market Sectors: A Comparison between the USA and China." Entropy 22, no. 2 (2020): 194. http://dx.doi.org/10.3390/e22020194.
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Information diffusion within financial markets plays a crucial role in the process of price formation and the propagation of sentiment and risk. We perform a comparative analysis of information transfer between industry sectors of the Chinese and the USA stock markets, using daily sector indices for the period from 2000 to 2017. The information flow from one sector to another is measured by the transfer entropy of the daily returns of the two sector indices. We find that the most active sector in information exchange (i.e., the largest total information inflow and outflow) is the non-bank financial sector in the Chinese market and the technology sector in the USA market. This is consistent with the role of the non-bank sector in corporate financing in China and the impact of technological innovation in the USA. In each market, the most active sector is also the largest information sink that has the largest information inflow (i.e., inflow minus outflow). In contrast, we identify that the main information source is the bank sector in the Chinese market and the energy sector in the USA market. In the case of China, this is due to the importance of net bank lending as a signal of corporate activity and the role of energy pricing in affecting corporate profitability. There are sectors such as the real estate sector that could be an information sink in one market but an information source in the other, showing the complex behavior of different markets. Overall, these findings show that stock markets are more synchronized, or ordered, during periods of turmoil than during periods of stability.
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Lima, Samuel Lyncon Leandro de, Adhmir Renan Voltolini Gomes, Roberto Francisco de Souza, and Delci Grapégia Dal Vesco. "Earnings Management versus Capital Structure: What Are the Chances of Companies Occurring Within the Discretionary Limit?" Revista de Negócios 24, no. 4 (2019): 55. http://dx.doi.org/10.7867/1980-4431.2019v24n4p55-63.
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The discussions about companies' debts have been pertinent to researches for decades, but it is still a puzzle issue. The mainly aspect this issue is how managers chooses funding sources. In this sense, the purpose of this study is analyzing the chances of occurring companies within the discretionary limit in relation to their capital structure. This research was conducts by logistic regressions with a sample of 706 energy sector firms from 37 countries around the world, with financial data from the period 2015 to 2017, making the total of 2.118 observations. So, results shows that profitability, investment opportunities, firm size, low capital structure are variables that affect to the chances of companies occurring within the discretionary limit. These results evidenced that the discretionary limit can be greater than 1% of the return on asset (ROA). Based on this findings we suggest that for some sectors, the discretionary limit may be different from the energy sector. Besides this, it depends by the attention of the regulatory agents of each country, as well as the relevance of the companies sector to the others.
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Barberán, Ramón, Diego Colás, and Pilar Egea. "Water Supply and Energy in Residential Buildings: Potential Savings and Financial Profitability." Sustainability 11, no. 1 (2019): 295. http://dx.doi.org/10.3390/su11010295.
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This article examines the suitability of water supply installations in residential buildings for the pressure conditions of the main water network, and evaluates the energy saving possibilities associated with pumping water into homes. It assesses the situation and the options for renovation in a sample of 151 buildings in the city of Zaragoza (Spain), estimating the savings in electric power and the possible financial returns that could be obtained. The results show that in half the buildings, the installations are inadequate and lead to inefficient energy use, which could be avoided by renovation. However, they also show that in many cases, this type of retrofitting would not be profitable for the building owners, meaning that technically viable solutions may not necessarily be financially viable. To mitigate or avoid the energy inefficiency in question, the public sector could step in by informing and financing support for building owners and regulating in the areas of town planning and construction.
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Shukla, Akanksha, Geetika Goel, and Nimesh Shukla. "Evaluating the impact of corporate social responsibility expenditure on profitability of energy sector firms in India." International Journal of Sustainable Society 11, no. 3 (2019): 220–34. http://dx.doi.org/10.1504/ijssoc.2019.103695.
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Sabău-Popa, Claudia Diana, Luminița Rus, Dana Simona Gherai, Codruța Mare, and Ioan Gheorghe Țara. "Study on Companies from the Energy Sector from the Perspective of Performance through the Operating Cash Flow." Energies 14, no. 12 (2021): 3667. http://dx.doi.org/10.3390/en14123667.
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In this paper we analyzed the link between companies’ performance, in terms of cash and income, and the labor productivity or management rates, in case of the companies from the energy sector listed on the Bucharest Stock Exchange. We focused on the energy sector because of the impact that its expansion has on the evolution of economies around the world and because of its dynamics in the sense of gradually shifting to the use of energy from renewable sources. We have used panel regression models to analyze the operating cash flow and the profitability rates and the determination of a causal or dependency relationship with labor productivity or management rates. The results of this study show a significant negative correlation between operating cash flows and the average duration of stock rotation, and no correlation between productivity and the operating cash flow. Instead, the average duration of stock turnover does not at all influence the profitability rates, and productivity is always significant for the return on assets, ie forthe return on equitywith a positive coefficient, as expected. The gap between the average duration of payment of suppliers and the average duration of receivables does not significantly influence neither the cash flow nor the rates of return.
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Bhangu, Parneet Kaur. "Persistence of profitability in top firms: does it vary across sectors?" Competitiveness Review: An International Business Journal 30, no. 3 (2020): 269–87. http://dx.doi.org/10.1108/cr-12-2018-0087.
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Purpose The purpose of this paper is to analyze variations in the degree of persistence of profitability across diverse economic sectors and industry groups over the time period of 1990-2014 for a sample of top publically listed firms belonging to a selected set of developed and developing economies. Design/methodology/approach Degree of profit persistence has been estimated using Mueller’s (1990) autoregressive methodology. Firms were classified into different economic sectors and industry groups as per the Global Industry Classification Standard (GICS). The examination of inter-sectoral variations in profit persistence has been performed by comparing mean values of estimated short-run and long-run profit persistence parameter for all firms and between firms belonging to the developed and developing countries, respectively. Findings Firms in consumer staples, consumer discretionary and health care enjoy persistent above the norm returns, unlike firms in traditional industries, utilities and energy sectors, which are characterized by low persistence and below the norm returns. A high degree of profit persistence is observed in health care and idea- and technology-intensive sector in the developed countries; however, in the developing countries, profits persist higher in consumer discretionary and capital-intensive telecommunication services sectors. Originality/value The study provides a holistic examination of inter-sectoral variations in profit persistence of top firms in developed and developing economies using a uniform methodology and data set. It can serve as an aid to the competition commissions and anti-trust regulatory authorities to formulate policies for curtailing anti-competitive activities in certain sectors.
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Trachenko, M. B., and A. O. Volodina. "Efficiency of multi-factor models for evaluating the yield on financial assets in the Russian stock market." Financial Analytics: Science and Experience 13, no. 2 (2020): 147–66. http://dx.doi.org/10.24891/fa.13.2.147.
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Subject. The article addresses the use of multi-factor models, like CAPM model, Fama-French model, Carhart model, for evaluating profitability of financial assets in the Russian economy. Objectives. The purpose is to show the expediency of using multi-factor models for evaluating the profitability of financial assets of Russian companies; identify the most effective models for companies operating in various sectors of economy; make evaluation over different periods of time (two years, one year, half year, quarter, and month). Methods. The study draws on the CAPM model, Fama-French model and Carhart model, and general scientific and statistical methods applied for the analysis of economic processes. Results. We evaluated expected return on financial assets of 41 companies in 5 different areas, i.e. the chemical industry (9 companies), oil and gas sector (9 companies), telecommunications (7 companies), transport (7 companies), and electric energy sector (9 companies) for different time periods. The paper includes estimations of expected yield in portfolios of financial assets by industry and time interval, assesses the effectiveness of multi-factor models, if they are used in the Russian economy, and identifies models, which are most suitable for predicting profitability of financial assets in the context of industry and time period. Conclusions. The Carhart model is the most preferable for evaluation of expected return on financial assets. It is impractical to use multi-factor models for companies operating in the transport and telecommunications industry. The considered models enable to make more accurate short-term forecasts.
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Sorrentino, Arianna, Antonio M. Pantaleo, Niccolò Le Brun, et al. "Energy performance and profitability of biomass boilers in the commercial sector: A case study in the UK." Energy Procedia 148 (August 2018): 639–46. http://dx.doi.org/10.1016/j.egypro.2018.08.152.
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Sotnyk, Iryna, Yevhen Kovalenko, Yuliia Chortok, and Yevheniia Kripak. "Prospects of Investment in Green Energy Projects in Ukrainian Households." ЕКОНОМІКА І РЕГІОН Науковий вісник, no. 2(73) (September 23, 2019): 12–21. http://dx.doi.org/10.26906/eir.2019.2(73).1621.
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For Ukraine the issue of renewable energy development is extremely relevant in view of energy (increase in energy independence), economic (reduction of energy resources import costs), environmental (reduction of environmental pollution) and social (improvement of energy supply, increase in income of the population) problems that can be solved at its expense. Based on the existing potential, if there exist adequate mechanisms of government support for the renewable energy development, Ukraine may increase the share of renewable energy sources in the energy balance up to 25% by 2035, reducing to import a significant share of energy resources. In order to justify the economic feasibility of investing in households’ renewable energy projects until 2029 and to identify the promising trends in this sector development in Ukraine, the authors have assessed the economic efficiency of a project of 10 kW solar power plant construction in a typical Ukrainian household under some conditions. The results have shown that it is expected to observe a gradual outflow of investments from renewable energy sector of households since 2022-2023 due to the decrease in feed-in tariff rates and a corresponding decrease in the profitability of private renewable energy projects with small power capacities. Therefore an alternative powerful state support will be needed to provide the development of renewable energy sector.
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Fernández-González, Raquel, Andrés Suárez-García, Miguel Ángel Álvarez Feijoo, Elena Arce, and Montserrat Díez-Mediavilla. "Spanish Photovoltaic Solar Energy: Institutional Change, Financial Effects, and the Business Sector." Sustainability 12, no. 5 (2020): 1892. http://dx.doi.org/10.3390/su12051892.
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Spain is a country with a high dependence on fossil fuels. For this reason, in 2007, it implemented a bonus system that aimed to encourage the production of renewable energies, particularly photovoltaic solar energy. These production bonuses, guaranteed by the Spanish government, led to an exponential increase in the number of companies in the market and, consequently, the MWh produced. However, in 2012, given the excessive budgetary burden involved in maintaining this “feed-in tariff” system and after several years of institutional instability, the aforementioned system of incentives for phoyovoltaic (PV) energy was eliminated. This paper has tried to analyze the consequences of this institutional change, a clear example of the “hold up” problem. For this purpose, a sample of 5354 companies, which was divided, geographically, into Spanish regions and, temporarily, into three different periods, has been taken, considering diverse economic and financial variables. The results show a notable weakening of the sector that, due to the effects of the regulatory change, has lost attractiveness and profitability for investors and is consequently suffering from stagnation, which has led to the disappearance of many companies in the sector.
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Hazarika, Natasha. "R&D Intensity and Its Curvilinear Relationship with Firm Profitability: Perspective from the Alternative Energy Sector." Sustainability 13, no. 9 (2021): 5060. http://dx.doi.org/10.3390/su13095060.
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There is an inconclusive debate concerning the relationship between environmental research and development (R&D) and corporate financial performance (CFP). The debate becomes more complex because a win–win situation between environmental and financial goals is not as plausible in practice as it is in theory. Though arguments have been made that when time-lag is considered, the relationship can produce positive outcomes for both entities, ambiguities persist because linear models dominate this analysis. This study, therefore, empirically tested the existence of a curvilinear relationship between R&D intensity and CFP in the context of the alternative energy sector. Using a panel dataset of 24 companies and 232 unbalanced firm-year observations for 10 years, it was found that after passing the inflection points, investment in R&D reaps financial benefits that will eventually offset the cost of the initial investment. The curvilinear relationship of R&D intensity on return on sales and net profit margin is strongly supported.
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Torre Olmo, Begoña, María Cantero Saiz, and Sergio Sanfilippo Azofra. "Sustainable Banking, Market Power, and Efficiency: Effects on Banks’ Profitability and Risk." Sustainability 13, no. 3 (2021): 1298. http://dx.doi.org/10.3390/su13031298.
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The financial crisis seriously damaged the reputation of the banking sector, as well as its profitability and risk of insolvency, which led many banks to adopt a sustainable approach aimed at balancing long-term goals with short-term performance pressures. This article analyses how sustainable banking practices affect the profitability and the insolvency risk of banks. Moreover, we examine how sustainable strategies determine the effects of market power and efficiency on bank profitability. We used a two-step System-GMM to analyze an unbalanced panel of 1236 banks from 48 countries over the period 2015–2019. We found that sustainable banking practices increased profitability, and market power was an important determinant of profitability among conventional banks, but not among sustainable banks. Higher levels of cost scale efficiency led to greater profitability for both sustainable and conventional banks. However, there was no significant relationship between sustainable banking and insolvency risk. These results indicate that the traditional determinants of bank profitability are not relevant in explaining the superior profits of sustainable banks, which suggests the emergence of a new paradigm related to sustainability among the drivers of bank profitability.
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Purba, Jan Horas Veryady, and Muhammad Rayno Septian. "Analysis of Short Term Financial Performance: A Case Study of an Energy Service Provider." Journal of Accounting Research, Organization and Economics 2, no. 2 (2019): 113–22. http://dx.doi.org/10.24815/jaroe.v2i2.14632.
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Objective – This study aims to analyze the short-term financial performance of an energy service company, and compared to companies in the oil and gas mining sub-sector. The results of this study indicate the profit and loss, asset management, and profitability of the company in the last 5 years. Design/methodology – The method used is descriptive method and quantitative method. The period of analysis of financial statement data is 2013-2017. This study uses (1) trend analysis to see a comprehensive picture of the company (2) financial ratio analysis to see company performance (3) comparative analysis comparing company financial statements with similar industries (4) SWOT analysis to determine strengths, weaknesses, opportunities, and threats and strategies needed by the company. Results – The Cost of Goods per Sales ratio tends to decrease, so sales decline. The company's EBIT trends are relatively smaller than the industry average. This reflects that the sampled company has not maximized the company's EBIT. The company has tried to maximize gross profit and with good asset management will have an impact on increasing profitability in the future.
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Selcuk, Isil Sirin, and Serap Durusoy. "The Relationship Between Financial Crisis and Energy Efficiency: A Sectoral Study in Turkey." Research in World Economy 10, no. 3 (2019): 78. http://dx.doi.org/10.5430/rwe.v10n3p78.
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Energy efficiency, which refers to services and output being produced with less energy input, has become an important issue in terms of increasing environmental performance, energy security and international competitiveness today. Sectoral energy efficiency directly affects energy consumption per output on one hand, and contributes positively to profitability through costs on the other. It results in a competitive advantage by enabling investments to be made at a lower cost compared to other sectors and shortening the break-even period of the investments. However, a decrease in cash flow due to difficult financing conditions created by the financial crisis, which emerged in the housing market in the US in 2008 and became a global crisis through the financial sector, affected the energy sector by creating a negative impact on energy demand and supply. The cancellation of projects due to lack of financing, reduction of oil supply and drilling operations of energy companies, and reductions in refined pipelines are examples of the problems experienced on the supply side. On the consumption side, equipment and device sales decreased. The effect of the financial crisis on energy efficiency will be examined in this study. Using the Logarithmic Mean Divisia Index Decomposition method, the causes of changes in energy intensity and energy use will be analyzed on a sectoral basis in Turkey. The aim of this study is to explain the sectoral changes caused by the financial crisis with the help of energy intensity measure based on an analysis conducted with current data.
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Radl, Johannes, Andreas Fleischhacker, Frida Huglen Revheim, Georg Lettner, and Hans Auer. "Comparison of Profitability of PV Electricity Sharing in Renewable Energy Communities in Selected European Countries." Energies 13, no. 19 (2020): 5007. http://dx.doi.org/10.3390/en13195007.
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The economic value of photovoltaic (PV) systems depends on country-specific conditions. This study investigates the impact of grid fees, solar irradiance and local consumption on the profitability and penetration of PV systems and batteries in renewable energy communities. The linear optimization model calculates the optimal investments into PV and storages applied on a test community, which represents the European housing situation. The comparison of eight countries considers individual heat and cooling demands as well as sector coupling. Results show that renewable energy communities have the potential to reduce electricity costs due to community investments and load aggregation but do not necessarily lead to more distributed PV. Besides full-load hours, the energy component of electricity tariffs has the highest impact on PV distribution. Under current market conditions, battery energy storage systems are rarely profitable for increasing PV self-consumption but there is potential with power pricing. Renewable energy communities enable individuals to be a prosumer without the necessity of owning a PV system. This could lead to more (community) PV investments in the short term. Hence, it hinders investments in a saturated PV market.
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Shanmugam, Mohana, Vinitha Karunakaran, and Asra Amidi. "Formulation of an integrated social commerce framework to promote social capital for energy sectors." Indonesian Journal of Electrical Engineering and Computer Science 15, no. 1 (2019): 427. http://dx.doi.org/10.11591/ijeecs.v15.i1.pp427-434.
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<p>Social capital refers to the resources available in personal and business networks. In developing a culture that values and practices social capital, social factors are considered one of the main precursors. With the proliferation of social commerce and the maturing of social media, social capital can be acquired and further developed for productive benefits, particularly for energy sectors in Malaysia. In this study, an integrated social commerce framework to promote social capital is presented and evaluated. The framework attempted to define the relationship between the Theories of Planned Behavior (TPB) and Social Support Theory (SST) alongside satisfaction and perceived value factors towards promoting social capital development in energy sectors. This research uses SPSS to analyse the data collected from employee in the energy sectors in Malaysia. Research reveals that social capital is present when there is trust and loyalty among the users and the significance of social capital is monumental for energy sectors’ productivity, efficiency and profitability. A survey is adapted and distributed to 20 respondents from the energy sector in Malaysia as a mean to study on the validity and reliability of the research factors. Results indicate that all proposed factors are significant in promoting social capital except one, which is the Perceived Behavioral Control (PBC) of the TPB.</p>
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SOKOLYUK, Sergyi, and Natalia FISCHUK. "FINANCIAL AND ECONOMIC STATE OF ENTERPRISES OF THE AGRICULTURAL SECTOR OF ECONOMY IN CHERKASY REGION." "EСONOMY. FINANСES. MANAGEMENT: Topical issues of science and practical activity", no. 9 (49) (September 25, 2019): 19–24. http://dx.doi.org/10.37128/2411-4413-2019-9-2.
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The article analyzes the average annual cost and dynamics of the introduction of new fixed assets of enterprises of the agricultural sector of economy. It is established that starting from 2016 there is a tendency to increase the value of fixed assets of enterprises of agricultural sector, which led to an increase in the growth rate of production of agrarian products and profitability. It is emphasized that in spite of positive changes in the dynamics of the new fixed assets introduction, the problem of fixed assets updating at the agricultural enterprises in the region remains unresolved. The tendency of operating assets value increase at the enterprises of the agricultural sector in the region is established. The significance of the analysis of the financial and economic state of agricultural enterprises according to the criteria of stability, solvency and business activity are considered through the prism of indices of capital structure, liquidity and turnover, which makes it possible to quantify the impact of quality management of financial resources on the level of profitability and dynamics of enterprise development. According to the results of the analysis of the enterprises of the agricultural sector of the region, their unsatisfactory financial and economic status was established. In this regard, it is proposed to strengthen the material and technical base of enterprises, to introduce material, energy and labor-saving technologies; develop and implement in agrarian production progressive methods of economy.
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Kareva, A. S. "Problems of Assessing Relative Profitability of Modern Russian Electric Power Industry." Voprosy statistiki 26, no. 8 (2019): 43–50. http://dx.doi.org/10.34023/2313-6383-2019-26-8-43-50.
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The contraction in investment activity and capital reversals from the electric power industry to other energy sectors in Russia poses a potential threat to the country’s energy supply. Identifying the causes of low investment attractiveness of the electric power industry in order to justify directions of regulatory impacts relates to a comparative assessment of the industry profitability. It gives greater urgency to the development of the relevant methodological guidelines.The paper presents the study of the two mutually reinforcing methods for measuring the profitability of the Russian energy industries and comparative analysis of electric power industry and industries related to the extraction and processing of oil and gas using data from Rosstat. The authors identified the strengths and weaknesses of the two methods used. In particular, it is shown that the method for calculating macroeconomic profitability thought versatile and straightforward is sensitive to changes in the initial data generation technique and its quality. Whereas, the application of the second method based on the aggregation of data on prices and structure of intermediate consumption of enterprises is limited to industries not participating in export-import operations.Through the practical application of the abovementioned methods, the author did not find any gaps in profitability between the power industry and other energy sectors. Hence, the relatively low investment attractiveness of the power industry is mainly due to structural causes (for example, pricing; low market efficiency). Economic and statistical analysis of the current situation allows, in the authors’ opinion, to make target government actions. Moreover, adequate management is a precondition for further improvements to the methodology of profitability analysis of energy sectors, primarily, advancement towards disaggregation of the considered indicators and data availability.
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Besley, Timothy, Nicola Fontana, and Nicola Limodio. "Antitrust Policies and Profitability in Nontradable Sectors." American Economic Review: Insights 3, no. 2 (2021): 251–65. http://dx.doi.org/10.1257/aeri.20200316.
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Firms in tradable sectors are more likely to be subject to external competition to limit market power, while nontradable firms are more dependent on domestic policies and institutions. This paper combines an antitrust index available for multiple countries with firm-level data from Orbis covering more than 12 million firms from 94 countries, including 20 sectors over 10 years and finds that profit margins of firms operating in nontradable sectors are significantly lower in countries with stronger antitrust policies compared to firms operating in tradable sectors. The results are robust to a wide variety of empirical specifications. (JEL D22, E02, L44)
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Copiello, Sergio, and Edda Donati. "Is investing in energy efficiency worth it? Evidence for substantial price premiums but limited profitability in the housing sector." Energy and Buildings 251 (November 2021): 111371. http://dx.doi.org/10.1016/j.enbuild.2021.111371.
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KALETNIK, Grygorii, and HONTARUK Yaroslav. "DIFFERENTIATION OF DEVELOPMENT OF SUB-SECTOR OF PROCESSING INDUSTRY OF AGRICULTURAL SECTOR OF VINNITSA REGION." "EСONOMY. FINANСES. MANAGEMENT: Topical issues of science and practical activity", no. 3 (53) (September 25, 2020): 7–23. http://dx.doi.org/10.37128/2411-4413-2020-3-1.
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The article analyzes the approaches to the interpretation of the concept of differentiation. The own interpretation of the concept of differentiation of development of branches as process of development of the enterprises on indicators of efficiency of use of actives, own capital, labor resources, efficiency of manufacture and possibility of creation of new kinds of production is offered. The components of the processing industry of the agro-industrial complex of Vinnytsia region are studied and the main ones are determined. The main factors influencing the development of differentiation of enterprises of the processing industry of the agricultural sector are analyzed. The analysis on the basic financial indicators of activity of the processing enterprises of agrarian sector of Vinnytsia region depending on the size of the organizations is carried out. Prospects for the privatization of distilleries in Ukraine are highlighted. The possibility of product differentiation at the enterprises of agro-industrial complex processing with orientation on creation of new productions is substantiated. The low level of management of distilleries was confirmed and the prospects of privatization of these organizations in accordance with the current legislation were outlined. It is determined that the main promising area of sectoral differentiation of the processing industry of the agro-industrial complex is the formation of sugar, meat processing, agricultural and alcohol industries on the basis of raw materials - production of biofuels (biogas, bioethanol). These studies show that the developed areas of differentiation of processing enterprises will avoid the practice of concealing profits at enterprises, increase revenues to the state budget from the alcohol industry; achieve growth in foreign investment. Improving the management of enterprises in the agro-industrial processing industry will contribute to the growth of the gross regional product and the profitability of production in the processing sectors of the agricultural sector. This will increase the energy independence of the region, reduce energy costs of distilleries, improve the environmental condition of water resources in the region, reduce greenhouse gas emissions and provide the livestock industry with protein feed.
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Milanés-Montero, Patricia, Alberto Arroyo-Farrona, and Esteban Pérez-Calderón. "Assessment of the Influence of Feed-In Tariffs on the Profitability of European Photovoltaic Companies." Sustainability 10, no. 10 (2018): 3427. http://dx.doi.org/10.3390/su10103427.
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Feed-in tariff policies have been the most common and effective tool contributing towards the important growth in photovoltaic solar energy in Europe. The purpose of this study is to analyze their influence on the economic profitability of photovoltaic companies operating in the most characteristic regions, Germany, Italy, France and Spain in the period 2008–2012. Variables characterizing these companies are also included. Regarding the method, a static linear panel data model is used. The results show how feed-in tariffs (FITs henceforth) have in fact had a significant positive influence on the economic profitability of these companies. In addition, the findings suggest that the expansion of these companies in terms of assets implies increased competition in the sector, positively influencing their profitability given the economies of scale generated. Moreover, contrary to expectations, photovoltaic companies with the highest leverage ratios are those with the largest return on investment in the analyzed period, what could be a consequence of their higher possibilities of investing the obtained external funds on PV technology.
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Guaita-Pradas, Inmaculada, and Ana Blasco-Ruiz. "Analyzing Profitability and Discount Rates for Solar PV Plants. A Spanish Case." Sustainability 12, no. 8 (2020): 3157. http://dx.doi.org/10.3390/su12083157.
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The widespread use of renewable energy sources and the growing concern about climate change, together with Spain’s exceptional weather and solar radiation conditions, have led to an increase in the use of photovoltaics for energy production in the country. Solar power generation has been tightly regulated, although the legal framework has changed frequently over the years. When assessing the potential financial performance of any business venture, legal as well as financial aspects must be considered, but a critical factor is the discount rate used, which must reflect the company’s capital cost. Other factors are the period of interest, the firm’s activity, market risk, and the level of debt of firms in the sector. The main objective of this study is thus to estimate the discount rate for companies using photovoltaics to produce solar power. We calculate it by employing two financial techniques: capital asset pricing model and historical return analysis. We then evaluate the investment in a photovoltaic plant with a capacity of 5000 kW located in eastern Spain, assuming it started its activity in different years which coincide with changes in the regulatory framework. The results show the relevance of the initial outlay costs for the profitability of photovoltaic power plants.
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Kamisli, Melik, Serap Kamisli, Fatih Temizel, and Ethem Esen. "What Affects the Relationships between Oil and Industrial Sector? Case of Eurozone." International Journal of Economics and Finance 9, no. 9 (2017): 52. http://dx.doi.org/10.5539/ijef.v9n9p52.
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Oil, which is one of the fundamental energy sources, is an important cost item especially for industrial sector. Increases in oil prices decrease the profits of the firms by causing increase in the production costs. For this reason, it is claimed that there is a strong relationship between oil price and industrial sector profitability. On the other hand, oil is an alternative investment vehicle that can be included to the portfolio. Therefore, in this study the relationships between oil price and industrial sector returns of European countries are analyzed with Maki (2012) cointegration test under multiple structural breaks, on the basis of European Debt Crisis. The results show that announcements of credit rating agencies, elections, resignations, announcements of European Central Bank and IMF, recovery packages and economic developments cause structural breaks in relationships. Results also indicate that there is no cointegration between oil price and industrial sector returns of Austria, Belgium and Holland.
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Soana, Maria Gaia, Laura Barbieri, Andrea Lippi, and Simone Rossi. "The Effect of Multiple Large Shareholders on Banks’ Profitability and Risk." Sustainability 13, no. 4 (2021): 1888. http://dx.doi.org/10.3390/su13041888.
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The wide-ranging academic literature on corporate governance in the banking sector includes only a few studies on bank ownership and, specifically, on the comparative power of shareholders within the corporate structure. This paper reports an investigation into the presence of multiple large shareholders and their influence on profitability and risk in the long-term, considering a sample of 697 U.S. and European listed commercial banks from 2008 to 2018. It was found that the number of large and institutional shareholders has a positive impact on profitability, but no effect on risk. However, long-term ownership by multiple large shareholders contributes to decreasing risk in banks.
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Teresienė, Deimantė, Greta Keliuotytė-Staniulėnienė, and Rasa Kanapickienė. "Sustainable Economic Growth Support through Credit Transmission Channel and Financial Stability: In the Context of the COVID-19 Pandemic." Sustainability 13, no. 5 (2021): 2692. http://dx.doi.org/10.3390/su13052692.
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All countries worldwide faced the COVID-19 pandemic and had to take actions to lower the economic shock. Financial authorities play an especially significant role in economics and can help to manage the negative consequences. This article focuses on the European central bank monetary policy and actions taken for COVID-19 risk management. This research aims to identify the significant factors influencing the long-term loans for enterprises’ credit conditions in a forward-looking approach and determine the impact of the spread of COVID-19 pandemic on banking sector credit risk, financial distress, lending growth, and financial soundness indicators. This research is focused on the credit transmission channel and the role of the Pandemic Emergency Purchase Program in different countries of the euro area. To reach the main goal, panel data regression models are used. Our findings showed that the banks’ risk tolerance is a principal factor influencing long-term loan credit standards. We also identified that the spread of the COVID-19 pandemic has a statistically significant negative effect on banking sector credit risk, financial distress, banking sector profitability, and solvency. Furthermore, after analyzing the euro area banking sector, we found that liquidity increased. Hence, it means that banks have enough funds to support sustainable economic growth, but on the other side, commercial banks do not want to take credit risk because of their risk tolerance. Our research findings show the mixed effect of the COVID-19 pandemic on financial stability: while the overall financial distress decreased and banking sector liquidity increased, the profitability and solvency decreased some extent.
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Kim, Dong-Hyun, Eul-Bum Lee, In-Hyeo Jung, and Douglas Alleman. "The Efficacy of the Tolling Model’s Ability to Improve Project Profitability on International Steel Plants." Energies 12, no. 7 (2019): 1221. http://dx.doi.org/10.3390/en12071221.
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To overcome profitability deterioration in executing steel price projects, companies are seeking overseas expansion, which increases market size while reducing profit certainty. Special purpose companies (SPCs) have been found to better manage these risks through tolling agreements which transfer the local pricing volatility risks (raw material, steel sales, licensing and income tax) to the project sponsor. The energy market has benefited from policy changes allowing the use of the tolling model, finding an increase in profitability for both project sponsors and SPCs through more effective risk sharing. While successes have been published in the energy, gas, and highway sectors, the tolling model’s efficacy has yet to be tested on the steel sector. As such, this research adds to the existing body of knowledge by testing the financial feasibility of using the tolling model on three million ton/year capacity steel projects. The data analyzed has been collected from “Company A”, a company with 50 years of domestic and 20 years international steel-iron plant project execution and operation experience. An economic analysis is performed on the best, most likely, and worst-case cost/revenue scenarios of a virtual project (which represents the average of all Company A projects) and two Company A projects under construction/operation. The findings support the use of the tolling model in volatile markets, showing a net present value (NPV) profitability increase of up to $940 versus the traditional project company model under worst case market conditions. However, the traditional project company model was found to be superior in best case market conditions. With these findings, international steel companies are able to consider alternative financing structures when executing projects in volatile markets, potentially resulting in greater project sponsor and SPC profit.
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Eder, L., and I. Filimonova. "The Financial Significance of the Oil and Gas Sector for the Russian Economy." Voprosy Ekonomiki, no. 10 (October 20, 2012): 76–91. http://dx.doi.org/10.32609/0042-8736-2012-10-76-91.
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The article describes the complex of economic and financial indicators reflecting the results of Russia’s oil and gas industry in 2011. Price environment of the major energy resources with regard to their realization at the domestic and international markets is analyzed. Main indicators of economic performance of the oil and gas industry (revenue, profit, profitability) are reviewed with differentiation by companies. The authors consider the tax burden for the oil and gas companies; show their role in forming federal budget revenues. The paper presents the analysis of specialized funds and reserves that are formed at the expense of oil and gas industry sources; examines Russia’s balance of payments as well as revenues generated by oil and gas exports. The stock market structure of Russia and the world is described with consideration of particular oil and gas companies.
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Gea-Bermúdez, Juan, Kaushik Das, Hardi Koduvere, and Matti Juhani Koivisto. "Day-Ahead Market Modelling of Large-Scale Highly-Renewable Multi-Energy Systems: Analysis of the North Sea Region towards 2050." Energies 14, no. 1 (2020): 88. http://dx.doi.org/10.3390/en14010088.
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This paper proposes a mathematical model in order to simulate Day-ahead markets of large-scale multi-energy systems with a high share of renewable energy. Furthermore, it analyses the importance of including unit commitment when performing such analysis. The results of the case study, which is performed for the North Sea region, show the influence of massive renewable penetration in the energy sector and increasing electrification of the district heating sector towards 2050, and how this impacts the role of other energy sources, such as thermal and hydro. The penetration of wind and solar is likely to challenge the need for balancing in the system as well as the profitability of thermal units. The degree of influence of the unit commitment approach is found to be dependent on the configuration of the energy system. Overall, including unit commitment constraints with integer variables leads to more realistic behaviour of the units, at the cost of considerably increasing the computational time. Relaxing integer variables significantly reduces the computational time, without highly compromising the accuracy of the results. The proposed model, together with the insights from the study case, can be especially useful for system operators for optimal operational planning.
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Hussain, Ijaz. "Growth and Financing Behaviour of Firms of Textile Industry in Pakistan: A Panel Data Analysis." Pakistan Development Review 50, no. 4II (2011): 699–714. http://dx.doi.org/10.30541/v50i4iipp.699-714.
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High economic growth, extremely low nominal interest rate and negative real interest rate gave a boost to financial leverage (gearing ratio) of the textile sector to its peak in 2005. Firms are now are facing the consequence of high gearing. An explosion in their financing costs along with removal of textile quota from 2005 onwards and later on an acute energy crisis hampered their profitability and ability to repay their debt. This in turn contributed to non-performing loans which is now is likely to pose a big challenge for financial sector and push economy into another crisis. Most of the previous studies including a very few on capital structure of Pakistani firms focus on understanding only the firm specific determinants of financial leverage and completely ignore macroeconomic or institutional factors. Findings of this paper prove that all firm specific determinants including profitability and efficiency, firms‘ growth, risk and collateral excluding size significantly influence corporate financial leverage of textile industry in Pakistan. All macroeconomic variables including overall economic growth, equity market conditions and nominal cost of debt also have significant impact on corporate gearing. Negative sign with the composite measure of profitability and efficiency implies that banks are compelled to fund inefficient and unprofitable firms because demand for loans comes more from inefficient and unprofitable firms. Positive sign with growth and negative sign with risk is indicative of the fact that banks prefer to lend to growing rather than riskier firms. JEL classification: C13, C23, C51, L65, G10, G30 Keywords: Capital Structure Determinants, Corporate Financial Leverage, Corporate Gearing Ratio
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Straková, Jarmila, Ismi Rajiani, Petra Pártlová, Jan Váchal, and Ján Dobrovič. "Use of the Value Chain in the Process of Generating a Sustainable Business Strategy on the Example of Manufacturing and Industrial Enterprises in the Czech Republic." Sustainability 12, no. 4 (2020): 1520. http://dx.doi.org/10.3390/su12041520.
Full textAbstract:
This paper presents a method of generating a business strategy using value chain analysis. There were 186 manufacturing and industrial enterprises from the Czech Republic. The analysis was carried out using mathematical–statistical methods (dimensional reduction, logit regression and its transformation in order to objectify the opinion level of the managers) and with a neural network in terms of validation of the results of the mathematical–statistical methods. The aim was to determine the significance of different parts of the value chain in terms of their impact on the profitability of an enterprise and to demonstrate its important role in the process of generating business strategy. The significance for the profitability of the enterprises was statistically proven in the area of scientific and technological development, input logistics and human resource management. These parts were identified by the authors as the golden triangle of manufacturing and industry. Purchasing and output logistics were identified as the parts with a negative impact to the profitability of the enterprises. Strong underestimation of scientific and technological development by the top managers of the manufacturing and industrial enterprises is seen as a very negative finding. Neural networks showed higher statistical sensitivity compared to the mathematical–statistical methods (dimensional reduction and logit regression). They defined the value sector chain with the following structure (ranked from the highest degree of positive impact on the profitability of the enterprise): human resource management, scientific and technological development, production, input logistics, purchasing, material management, output logistics, enterprise infrastructure, marketing and sales, service and other supporting services. In conclusion, it is stated that the sector value chain of manufacturing and industrial enterprises will be further decomposed into value chain models of specific industries of the production and industry, such as engineering and construction, intended for direct use in different business entities to generate their unique value chains and corporate strategies.