THE ROLE OF FINANCIAL RATIOS ON OPTIMIZING COMPANY
PERFORMANCE AT PT ANGKASA PURA RETAIL
Fakhru Umam Maha1,
Sylviana Maya Damayanti2
Institut Teknologi Bandung
fakhru_umam@sbm-itb.ac.id,
sylvianamaya@sbm-itb.ac.id
Abstract
In the
middle of a situations that are getting full of uncertainty, both caused by
external conditions such as the global economic crisis, the covid 19 pandemic
and internal conditions such as declining financial performance and HR productivity,
it is necessary for the organization's responsiveness to anticipate any changes
by adjusting to a changing business environment that has the potential to
create opportunities and risks for the organization, so it is important for the
organization to carry out risk management. In this study, secondary and primary
data types are used. Secondary data is information that is already accessible
or controlled by another party, in this example PT Angkasa
Pura Retail, in the form of company financial reports, whereas primary data is
information that researchers handle directly in the form of revenue enhancement
data. Based on the results of data
analysis that has been done in the previous chapter, as well as to answer the
problems of this research, the conclusions made in this research as follows: 1.
PT. Angkasa Pura Retail's performance is
significantly impacted negatively by corporate risk between 2020 and 2022. 2. PT.
Angkasa Pura Retail, innovation capabilities
significantly improve company performance between 2020 and 2022. 3. From 2020
to 2022, the performance of the company at PT. Angkasa
Pura Retail is unaffected by leverage. 3. From 2020 to 2022, PT. Angkasa Pura Retail's performance is significantly impacted
by liquidity. 4. From 2020 to 2022, growth will have a substantial beneficial
impact on the corporate performance at PT. Angkasa
Pura Retail. 5. Corporate risk, innovation capability, leverage, liquidity, and
growth have a significant effect on company performance at PT. Angkasa Pura Retail period from 2020 to 2022.
Keywords: finance
against; performance optimization; retail
In the middle of a situations that are getting full of
uncertainty, both caused by external conditions such as the global economic
crisis, the covid 19 pandemic and internal conditions such as declining financial
performance and HR productivity, it is necessary for the organization's
responsiveness to anticipate any changes by adjusting to a changing business
environment that has the potential to create opportunities and risks for the
organization, so it is important for the organization to carry out risk management.
Opportunities can be an opportunity for the organization to go several levels
better while risk is a potential loss and failure, which can even lead to
bankruptcy positions. Risk is defined as an unfavorable incident or the
potential that the outcomes produced may differ from what is expected.
Data from the Ministry of Tourism and Creative Economy in
2020 shows that the tourism sector is under enormous pressure in the Indonesian
economy due to the Covid-19 pandemic. This has led to a decrease in foreign
exchange earnings, limited employment opportunities, and opportunities to do
business in the tourism sector. The number of foreign tourists decreased by 74.84
percent in 2020 to 4 million tourists. Meanwhile, the number of domestic
tourists is around 518 million throughout 2020. Meanwhile, based on the number
of visitors to the tourism sector in Indonesia throughout 2020, the majority
are domestic visitors compared to foreign visitors. The number of Indonesian
visitors reached 193.63 million people, covering 98.22 percent of the total
visitors throughout 2020.
According to data from the Ministry of Tourist and Creative
Economy for 2021, the tourism sector is now contracting in all nations. In
Indonesia, the contraction can be seen in terms of tourist visits, both foreign
and domestic tourists, whose numbers have decreased. Foreign tourist visits
contracted by almost 74.9% or around four million, while the number of domestic
tourist visits decreased by almost 30% or 198 million. As a result, the tourist
industry's contribution to GDP has been disrupted. In terms of foreign
exchange, the contraction was almost 90% or US$3.4 billion. The Covid-19
pandemic has also had an impact on the tourist industry, which has decreased by
6.67%, or around 13.67 million employees. This is one of the effects of
Covid-19 on the tourist impact. The number of foreign tourists from the
American continent visiting Indonesia in 2021 has decreased very sharply. The
number of tourists from the United States (US) and Canada contracted, falling
by around 79% and 77% respectively. These figures show that the tourism
situation in Indonesia has not yet recovered, not even gradually recovered.
However, the tourism sector business began to improve in 2022. This is
evidenced by the fact that the number of international tourist movements
(foreign tourists) visiting Indonesia in June 2022 will reach 345.44 thousand
visits. In comparison to June 2021, this statistic increased by about 2,000
percent, or 1,973.96 percent. The number of international tourist visits to
Indonesia through the major gates reached 743.21 thousand from January to June
2022. When compared to the same period in 2021, this value climbed by 929.66
percent. In June 2022, the room occupancy rate (TPK), also known as star-rated
hotel occupancy, in Indonesia reached 50.28 percent, an increase of 11.73
points over the previous month. The June 2022 TPK also increased by 0.43 points
as compared to May.
The declining state of the tourism business during the Covid
19 pandemic has had an effect on the deterioration of the aviation industry in
Indonesia. This is as stated by the Director General of Civil Aviation,
Ministry of Transportation that the Covid-19 Pandemic has made all airports in
the world lose their activities, namely aircraft flight activities from one
city to another from one country to another, including in Indonesia. In terms
of air transportation, due to the pandemic, airline companies that have air
transportation modes both domestic routes and those with wide access to
international routes have closed their routes.
Risk management strives to manage these risks in order to get
the best possible results. In the framework of organizations, there will be
several risks. If the organization is unable to handle risks effectively, it
may suffer losses. As a result, the risks that the organization faces must also
be controlled in order for the organization to survive or possibly optimize the
risks.
One type of company that also needs to manage risk properly
due to challenges both from the external and internal sides is a retail
company. Where the retail industry continues to change every year and there are
always new challenges that must be faced by players in the competitive retail
industry. The high level of competition and risk in the retail industry in
Indonesia can be seen from several well-known retail companies that decided to
close their stores, including Debenhams, Lotus, and 7-Eleven.
PT Angkasa Pura Retail, like one of
the retail companies, is also embroiled in severe rivalry in this industry and
confronts business risks. (Andersen,
2008) found that effective risk management
results in a significant positive effect on firm performance. Furthermore, (Andersen,
2008) shows that companies with varying
degrees of innovation will have varied risk management effects.
Similarly, (Gupta,
2011) studied risk management in Indian
firms and investigated the causes for the adoption or non-acceptance of an
integrated risk management methodology. According to (Gupta,
2011), while effective risk management may
improve organizational performance, firms lack the necessary infrastructure to
undertake enterprise-wide risk management. (Gupta,
2011) found that a significant shift in
risk perception is necessary to create a risk culture across business sectors
and promote risk management adoption.
In this study, secondary and primary data types are used.
Secondary data is information that is already accessible or controlled by
another party, in this example PT Angkasa Pura Retail,
in the form of company financial reports, whereas primary data is information
that researchers handle directly in the form of revenue enhancement data. Data is gathered by entering all
pertinent information in the company's annual report. The data utilized are
registered and publicized company performance reports from 2020 to 2022. The
data source in this study is from PT. Angkasa Pura
Retail
Figure 1 Research Framework
Research variables are basically anything in any form that
researchers decide to study in order to gather knowledge about it and then draw
conclusions (Sugiyono,
2018). The operational definition of a
variable is the operational understanding of the variable (as given in the
concept definition) within the scope of the research object/object researched.
The operational definition of research variables is a description of each
variable used in the study of the indicators that make up the variable. The
variables used in the research are:
1.
Independent
Variable
Independent variables, according to (Sugiyono,
2017), are factors that are commonly
referred to as stimulus, predictor, and antecedent variables. It is commonly
referred to as the independent variable in Indonesian. The independent variable
is the variable that impacts or causes the dependent variable to change or
emerge. Corporate risk (X1), innovation capability (X2), leverage (X3),
liquidity (X4), and growth (X5) are the independent variables considered in
this study.
2.
Dependent
Variable
(Sugiyono,
2017) defines the dependent variable as a
variable that is frequently referred to as an output variable, criterion, or
consequences. In Indonesian, it is generally referred to as the dependent variable,
which is the variable that is influenced or resulting from the independent
variable. The dependent variable in this study is corporate performance.
|
Variable |
Operationalization |
Skala |
|
Corporate Risk (X1) |
Standard
deviation of annual net sales |
Rasio |
|
Innovation Capability (X2) |
Revenue
enhancement |
Rasio |
|
Leverage (X3) |
Total
debt divided by total equity |
Rasio |
|
Liquidity (X4) |
Current
assets divided by current debt |
Rasio |
|
Growth (X5) |
Current
sales subtract previous sales divided by previous sales |
Rasio |
|
Corporate Performance (Y) |
Net
profit (loss) divided by the average of total assets or the sum of equity and
long-term debt |
Rasio |
Table 1
Operationalization Variable
Data Collection Method
The paradigm used in this study is a positivistic
paradigm. In quantitative/positivistic research, which is based on an assumption
that a symptom can be classified, and the relationship of symptoms is causal
(cause and effect), this research can conduct research by focusing on just a
few variables. The pattern of relationship between the variables to be examined
is hereinafter referred to as the research paradigm
This study employs a quantitative
method with an explanatory or causal design, with the goal of explaining how
one variable influence or is responsible for changes in other variables. Corporate
risk, innovation capability, leverage, liquidity, and growth are the
independent variables in this study, while company performance is the dependent
variable (Anabella & Siregar, 2022).
Data Analysis Method
The data
analysis used in this study was multiple regression with the help of the EViews
10 program. Before carrying out multiple regression analysis and hypotheses,
descriptive statistical tests were first carried out.
A
distribution (data) is a computation of values from lowest to highest, as a consequence
of incident tabulation. Descriptive statistical metrics are used to
characterize the distribution's center, dispersion,
and shape and are highly useful as preliminary tools for data description (Mabasa, 2022). The data distribution is described by the standard
deviation, maximum value, and minimum value. Data with a higher standard
deviation indicates that the data is more dispersed. The distribution of metric
variables is described by standard deviation, maximum value, and minimum value.
Multiple Linear Regression Test
Multiple regression is employed as a
descriptive tool in three contexts, according to (Hwang, Chen, Shadiev, Huang, & Chen, 2014) First, it is
used to create self-weighted estimate equations to predict values for the dependent
variable from values for numerous independent variables. Second, to control
confusing factors so that the impact of other variables may be better
evaluated. Third, put the causal hypothesis to the test and explain it.
Multiple regression is utilized as an inference tool as well as a descriptive
tool to test hypotheses and estimate populations.
In this study, the multiple
regression analysis technique was utilized to assess the hypotheses, which
involved a single dependent variable and two or more independent variables.
Multiple regression can be used to address regression-related issues by
including additional independent variables (Malhotra, 2017). Corporate
performance is the dependent variable in this study, whereas the independent
variables are corporate risk, innovation capability, leverage, liquidity, and
growth. Thus, the multiple regression model in this study can be written in the
form of an equation as follows:
Y = α + β1X1+ β2X2 +
β¬3X3 + β¬4X4 + β¬5X5 + ε
Where:
Y =
Company Performance
α = Constants
β1 – β3= Regression coefficients of each
independent variable
X1 =
Corporate Risk
X¬2 =
Innovation Capability
X3 =
Leverage
X4 =
Liquidity
X5 =
Growth
e =
error term
Hypothesis Testing
To test the
hypothesis, the following steps are taken: To test the hypothesis and the
coefficient of determination, the t test and f test is utilized. In this study,
the t test, f test and coefficient of determination tests are utilized to
determine how much influence each independent variable has on the dependent
variable.
Partial Hypothesis Test with T test
1.
Determine
ttabel
To determine the first ttable, df (degree of freedom) is determined. In this study the
specified α is 5%. df is obtained from the
formula (n-k) or the amount of data minus the number of variables.
2.
Determine
tcount
3.
To
determine tcount, data processing was carried out
using the EViews 10 statistical program tool.
where to enter the formula
r = correlation
coefficient
n = number of respondents
k = variable number
4.
Compare
tcount with ttable.
To determine whether the hypothesis is accepted or
rejected with the following conditions:
tcount < ttable,
means that Ho is accepted (no effect)
tcount ≥ ttable,
means Ho is rejected (effect)
5.
Decision
making
Decision making is done according to the results of
the comparison of tcount with ttablel.
To find out the t-table, the n-k provisions are used at a
level of significance of 5% (error rate of 5% or 0.05) or a confidence level of
95% or 0.95. So if the error rate of a variable is more than 5%, it means that
the variable is not significant (Hayter,
1986).
Simultaneous Hypothesis Test with F test
A test to
determine how the effects of all independent variables combined against
dependent variables are known as a F test, referred to as a concurrent test or
Model Test/Anova test. Or to determine whether the
regression model we develop is effective/significant or
ineffective/non-significant (Ghozali, 2016). The steps of the test are as follows:
Creating
the null hypothesis (H0) and the alternative hypothesis (H1).
H0: ρ
= 0, the expected independent variables together are not significant effect on
the dependent variable.
H1: ρ
≠ 0, suspected substantial significant between independent variables and
the dependent variable.
Set the
test criteria are:
§
Reject H0
if the significance number is greater than α = 5%
§
Accept H0
if the significance number is less than α = 5%
Determination Coefficient Test
According to (Malhotra 2017: 525), the coefficient of
determination (R2) is the strength of the association measured by the coefficient
of determination (R2) ranging between 0 and 1 and reflecting the proportion of
the total variation in Y that is recorded by variation X. Furthermore, (Malhotra
2017: 535) calculated diminishing returns by changing R2, or the coefficient of
determination, for the number of independent variables and sample size.
Additional independent variables contribute little beyond the first few variables
Results and Dicsussion
The research data
were analyzed using both descriptive and inferential statistics. The
descriptive statistical test aims to describe the distribution of data seen
from the maximum, minimum, and average values, while the inferential
statistical test, especially multiple linear regression, aims to test the
research hypothesis, for further business solutions and implementation.
Descriptive
Statistics
In this study, descriptive statistical
analysis aims to find the research data's lowest, maximum, average (mean), and
standard deviation values. The results of descriptive statistical tests on all
variables can be seen in table IV.1 as follows:
Tabel 2 Descriptive Statistical Test Results
Source:
results of data processing with Eviews 10 (2022)
Where:
Y
: Company Performance (ROA)
X1 : Corporate Risk (RISK)
X2 : Innovation Capability (INNOV)
X3 : Leverage (LEV)
X4 : Liquidity (LIQ)
X5 : Growth (GR)
Based
on the descriptive statistical test table above, information is obtained that:
1.
Company
Performance (Y)
According
to the data processing, the company performance (ROA) variable has a mean or
average value of -0.245000, with a maximum value of -0.168000 in 2021 and a
lowest value of -0.356000 in 2020. With a standard deviation of 0.098504, this
suggests that the average variable increased the most. The average variable
company performance (ROA) increased by +0.098504, whereas the average variable
company performance (ROA) decreased by -0.098504. These results explain that on
average PT Angkasa Pura Retail's ability to generate
ROA per year of -0.098504 is still relatively low because it is still very far
below the risk free value of 4.25% (BPS, 2022). Or in other words, PT Angkasa Pura Retail has not managed to maximize its
potential assets to generate returns.
2.
Corporate Risk (X1)
According
to the data processing, the corporate risk (RISK) variable has a mean or
average value of 52.34667, with a maximum value of 114.1650 in 2022 and a
minimum value of 16.56500 in 2021. The size of the highest rise in the average
variable has a standard deviation of 53.75631. The greatest rise in the average
corporate risk (RISK) variable is +53.75631, whereas the maximum reduction is -53.75631.
These results explain that PT Angkasa Pura Retail's corporate
risk level is medium, because the level of increase or decrease in the standard
deviation is above the average value. This shows that PT Angkasa
Pura Retail is quite vulnerable to external shocks which ultimately have an
impact on internal performance. This condition can be seen from the Covid-19
pandemic that hit Indonesia in early 2020, which then made PT Angkasa Pura Retail's business sluggish which in the end
made the company suffer losses in 2020. Things like this show that PT Angkasa Pura Retail is not ready to face risks or risk
control by the management of PT Angkasa Pura Retail
is still not optimal.
3.
Innovation Capability (X2)
According
to the data processing, the innovation variable (INNOV) has a mean or average
value of 150,6630 with a maximum value of 224,8980 in 2021 and a minimum value
of 2.317000 in 2022. With a standard deviation of 128,4714, the maximum rise in
the average variable is possible. The largest rise in average variable
innovation (INNOV) is +128,4714, whilst the maximum fall in average variable innovation
(INNOV) is -128,4714, These results explain that PT Angkasa
Pura Retail's level of innovation is very good, because the company's ability
to record sales exceeds the target set by the company per year.
4.
Leverage (X3)
Based
on the data analysis, the leverage variable (LEV) has a mean or average value
of 65.02700, with a maximum value of 201.8620 in 2021 and a minimum value of -9.128000
in 2022. With a standard deviation of 118.6414 the magnitude of the greatest
increase in the average variable is. The average variable leverage (LEV) increases
by +118.6414, while the maximum falls by -118.6414. These findings explain why
PT Angkasa Pura Retail's debt ratio is relatively high
on average, indicating that the entire debt carried by the firm is more than
the total equity. With such a large debt level, if not managed properly by
management, there will be a potential risk of default and can lead to
bankruptcy. The condition of PT Angkasa Pura Retail's
debt ratio which is 200 times greater than equity because the company's equity
has decreased very significantly to only IDR 600.606.544 in 2021.
5.
Liquidity (X4)
According
to the data processing, the liquidity variable (LIQ) has a mean or average
value of 0.895667, with a maximum value of 0.973000 in 2020 and a lowest value
of 0.838000 in 2021. With a standard deviation of 0.069616, the greatest
increase in the average variable is shown. The largest gain in average variable
liquidity (LIQ) is +0.069616, while the maximum loss in LIQ is -0.069616. These
findings suggest that PT Angkasa Pura Retail's liquidity
ratio is relatively secure, since there is still a 1:1 ratio between current
liabilities and current assets, indicating that the company could meet its
short-term obligations.
6.
Growth (X5)
According
to the data processing, the growth variable (GR) has a mean or average value of
1.525667, with a maximum value of 5.855000 in 2021 and a lowest value of -0.649000
in 2020. With a standard deviation of 3.749326, the magnitude of the greatest
increase in the average variable is. The largest rise in average variable
growth (GR) is +3.749326, while the maximum fall in average variable growth
(GR) is -3.749326. These results explain that on average the growth rate of PT Angkasa Pura Retail is quite good, because the average
growth value is greater than the standard deviation value which is the value of
increase and decrease.
Multiple Linear
Regression Analysis
The
purpose of this study's multiple linear regression test is to identify the
impact of corporate risk, innovation capability, leverage, liquidity, and growth
on company performance. The results of several linear regression tests are
shown in Table IV.2.
Tabel 3
Multiple Regression Test Results
|
Dependent Variable:
ROA |
|
|
||
|
Method: Least
Squares |
|
|
||
|
Date: 01/02/23 Time: 12:17 |
|
|
||
|
Sample: 2020Q1
2022Q4 |
|
|
||
|
Included
observations: 12 |
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable |
Coefficient |
Std. Error |
t-Statistic |
Prob. |
|
|
|
|
|
|
|
|
|
|
|
|
|
C |
1.277131 |
0.411809 |
3.101268 |
0.0211 |
|
RISK |
-0.122530 |
0.029055 |
-4.217139 |
0.0056 |
|
INNOV |
0.119338 |
0.027841 |
4.286362 |
0.0052 |
|
LEV |
-0.000460 |
0.000877 |
-0.524423 |
0.6188 |
|
LIQ |
0.052856 |
0.017643 |
2.995858 |
0.0241 |
|
GR |
-0.060691 |
0.019261 |
-3.150990 |
0.0198 |
|
|
|
|
|
|
|
|
|
|
|
|
|
R-squared |
0.980000 |
Mean
dependent var |
-0.245000 |
|
|
Adjusted R-squared |
0.970000 |
S.D.
dependent var |
0.102924 |
|
|
S.E. of regression |
1.50E-06 |
Akaike
info criterion |
-23.67369 |
|
|
Sum squared resid |
1.35E-11 |
Schwarz
criterion |
-23.43123 |
|
|
Log likelihood |
148.0421 |
Hannan-Quinn
criter. |
-23.76345 |
|
|
F-statistic |
103E+10 |
Durbin-Watson
stat |
1.757673 |
|
|
Prob(F-statistic) |
0.000000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Source: results of data
processing with Eviews 10 (2022)
Based
on Table IV.2 above, it can be concluded that the corporate risk, innovation
capability, liquidity, and growth variables have an effect on company
performance because they have a probability value smaller than alpha 0.05 while
leverage has no effect on company performance because it has a probability
value of 0,6188 is greater than alpha 0.05. And the F test or simultaneous test
of corporate risk, innovation capability, leverage, liquidity and growth
together affect company performance because it has a probability value of
0.0000 < alpha 0.05.
Hypothesis Testing
Testing this hypothesis is intended to test whether
corporate risk, innovation capability, leverage, liquidity and growth affect
company performance. The hypothesis test is divided into two parts, namely: 1.
Partial hypothesis (t test), 2. Simultaneous hypothesis (F test). The results
of the hypothesis as follows:
Partial Hypothesis Test
(T test)
The
T statistical test may be used to measure the influence of an independent
variable on explaining the variance of the dependent variable. If the
significance probability value of an independent variable is less than 0.05, it
is considered to be a significant explanation of the dependent variable. The
following are the findings of the partial hypothesis test in this study, as
shown in table IV.3:
Tabel 4
Partial Hypothesis Results (T test)
|
Variable |
t |
Sig. |
Conclusion |
|
|
1 |
Corporate
Risk |
-4.217139 |
0.0056 |
H1 Supported |
|
2 |
Innovation
Capability |
4.286362 |
0.0052 |
H2 Supported |
|
3 |
Leverage |
-0.524423 |
0.6188 |
H3 Not Supported |
|
4 |
Liquidity |
2.995858 |
0.0241 |
H4 Supported |
|
5 |
Growth |
3.150990 |
0.0198 |
H5 Supported |
Source:
results of data processing with Eviews 10 (2022)
Table
IV.3 contains the t test findings, which will be used to discuss the study
hypothesis as follows:
Hypothesis 1
The
first hypothesis in this study seeks to ascertain the impact of corporate risk
factors on PT. Angkasa Pura Retail's performance. The
following is the hypothesis:
H01=
Corporate risk has not positive effect a company's performance.
Ha1=
Corporate risk has positive effect a company's performance.
The
predicted t value produced by the corporate risk variable is -4.217139 and is
significant at 0.0056, as shown in Table IV.3. The estimated t value is more
than the t table (-4.217139 > 2.365), and the significant value is less than
0.05 (0.0056 < 0.05), suggesting that H01 is rejected and Ha1 is approved.
As a result, it is reasonable to assume that corporate risk has a negative
influence on PT. Angkasa Pura Retail's performance.
Hypothesis 2
The
second hypothesis in this study aims to determine the effect of innovation
capability on company performance at PT. Angkasa Pura
Retail. The hypothesis put forward is:
H02=
Innovation Capability has not positive effect a company's performance.
Ha2=
Innovation Capability has positive effect a company's performance.
Table
IV.3 displays the computed t value for the innovation capability variable,
which is 4.286362 and significant at 0.0052. The estimated t value is more than
the t table (4.286362 > 2.365), and the derived significant value is less
than 0.05 (0.0052 < 0.05), suggesting that H02 is rejected and Ha2 is
approved. As a result, it is possible to infer that PT. Angkasa
Pura Retail's innovation capabilities has a favorable impact on the company's
performance.
Hypothesis 3
The
third hypothesis in this study seeks to ascertain the impact of the leverage
variable on PT. Angkasa Pura Retail's performance.
The following is the hypothesis:
H03=
Leverage has not positive effect a company's performance.
Ha3=
Leverage has positive effect a company's performance.
The
computed t value derived by the leverage variable is -0.524423 and is
significant at 0.6188, as shown in Table IV.3. The estimated t value is less than
the t table (-0.524423 < 2.365) and the significant value is more than 0.05
(0.6188 < 0.05), suggesting that Ha3 is rejected and H03 is approved. Thus
it can be concluded that leverage has no effect on company performance at PT. Angkasa Pura Retail.
Hypothesis 4
The
fourth hypothesis in this study is to ascertain the impact of changing
liquidity on PT. Angkasa Pura Retail's performance.
The following is the hypothesis:
H04
= Liquidity has not positive effect a company's performance.
Ha4
= Liquidity has positive effect a company's performance.
Table
IV.3 displays the computed t value of the liquidity variable, which is 2.995858
and significant at 0.0241. The estimated t value is bigger than the t table (2.995858
> 2.365), and the derived significant value is less than 0.05 (0.0241 >
0.05), suggesting that H04 is rejected and Ha4 is approved. As a result, it is
possible to conclude that liquidity has a beneficial impact on PT. Angkasa Pura Retail's performance.
Hypothesis 5
The
fifth hypothesis in this study is to ascertain the impact of growth factors on
PT. Angkasa Pura Retail's performance. The following
is the hypothesis:
H05
= Growth has not positive effect a company's performance.
Ha5
= Growth has positive effect a company's performance.
The
computed t value acquired by the growth variable is equal to 3.150990 and is
significant at 0.0198, as shown in Table IV.3. The estimated t value is bigger
than the t table (3.150990 > 2.365) and the significant value is less than
0.05 (0.0198 < 0.05), suggesting that H05 is rejected and Ha5 is approved.
As a result, it is possible to conclude that growth has a beneficial impact on
PT. Angkasa Pura Retail's performance.
Simultaneous Hypothesis
Test (F Test)
At
the same time, the F test may be used to analyze the effect of the independent
variables on the dependent variable. If the significant value is less than
0.05, the independent variables have an effect on the dependent variable at the
same time. Table IV.4 displays the results of the F test in this inquiry.
Tabel
IV.5 Simultaneous Hypothesis Results (F test)
|
F-statistic |
103.10 |
|
Prob(F-statistic) |
0.0000 |
Source:
results of data processing with Eviews 10 (2022)
The
results of the F test in Table IV.4 obtained an F-statistic value of 103.10 and
a Prob (F-statistic) of 0.000000. When the estimated F value is less than the F
table (103.10 > 4.120) and the probability is less than the significance
threshold (0.000000 < 0.05), H06 is rejected; otherwise, Ha6 is approved.
These results indicate that corporate risk, innovation capability, leverage,
liquidity and growth simultaneously affect company performance at PT. Angkasa Pura Retail.
Determination Coefficient
Test
The coefficient of determination (R2) measures the
model's ability to explain the independent variable. Table IV.4 displays the
results of the coefficient of determination test in this study:
The modified R2 value is 1.000000 based on the data
processing findings. This means that the independent variables examined in this
study, namely corporate risk, innovation capability, leverage, liquidity, and
growth, can explain 100% of the dependent variable, namely company performance.
Based on the results of
hypothesis testing with multiple linear regression on corporate risk,
innovation capability, leverage, liquidity and growth on company performance,
business solutions can be described that can be run by PT. Angkasa Pura Retail.
Effect of Corporate Risk
on Company Performance
The first hypothesis illustrates that corporate risk
has a computed t value bigger than t table (-4.217139 > 2.365) and a significant value less than
0.05 (0.0056 < 0.05). These
findings suggest that corporate risk has a negative impact on company
performance at PT. Angkasa Pura Retail from 2020 to
2022.
By managing the company's risk level properly, the
company will be more focused on controlling various company risks that occur.
Referring to stakeholder theory, all stakeholders have the right to information
about how organizational activities are carried out (Phillips, Freeman,
& Wicks, 2003). According to (Mardiana &
Purnamasari, 2018) risk management is used as a basis for taking,
defining, and implementing the right actions or steps for the company. Risk
management is frequently viewed as impeding growth, delaying internal
operations, and burdening a company's budget, among other things. A solid risk
management system may help to control hazards and enhance financial
performance.
This study's findings are consistent with those of (Mamari et al. 2022); (Ghazieh and
Chebana 2019) find that risk management has a
substantial negative association with performance. (Damayanti and Venusita's 2022) research found a negative association
between a company's risk and its performance. Corporate risk, according to (Mohammed
and Knapkova 2016) and (Bertinetti
et al. 2013), has a negative impact on company performance.
There is a significant negative influence between
company risk and company performance because the higher the risk, the lower the
company's net profit. This happens because companies that have high risk, will
bear the cost of financing capital which is also high, this will erode the
company's profits. Besides that, high-risk companies are very vulnerable to
changes in external conditions, so that it will be very easy to affect a
decrease in sales or company revenue, which in turn will make the Return on Assets
ratio also decrease.
Research results have proven that high corporate
risk can reduce the level of company profitability. Therefore, business
solutions that can be run by the management of PT. Angkasa
Pura Retail, namely the need to strengthen the risk management team and carry
out planning and measurable actions so that risks can be minimized. This can be
done, among others by: identifying risks, in which the company's risk
management must identify the possibility of risks that will arise both from
internal and external factors, management also needs to analyze the impact
arising from these risks from the impacts from mild to severe, then management
also needs to prepare problem solving for risks that might arise, and finally
take control measures. By exercising control will help the company to be able
to evaluate if there is a shortage.
Effect of Innovation
Capability on Company Performance
The second hypothesis
illustrates that innovation has a computed t value bigger than t table (4.2863
>
2.365) and a significant value less than 0.05 (0.0052 < 0.05). These findings
suggest that PT. Angkasa Pura Retail's innovation
capabilities has a beneficial influence on firm success from 2020 to 2022. This
suggests that more innovation potential will lead to improved company
performance.
According to (Fagerberg,
Mowery, and Nelson 2006), the importance of innovation is emphasized in their
study, which shows that innovative organizations have greater levels of
production and income than less inventive companies. The Covid-19 pandemic that
happened in Indonesia in 2020 resulted in a drop in revenues and assets controlled
by PT. Angkasa Pura Retail, despite the fact that PT.
Angkasa Pura Retail is claimed to have a high degree
of innovation. Companies that innovate can extend their market and capitalize on
new possibilities, resulting in increased profitability (Francis et al., 2020).
These findings confirm the stakeholder theory which explains that companies do
not only act in their own interests but must provide benefits to stakeholders.
These benefits can be in the form of added value to improve the financial performance
of the company's innovation activities.
The findings of this
hypothesis corroborate the findings of (Jayani and Hui 2018), who found that
effective innovation skills that help give more effective innovation outcomes
result in greater performance, which benefits management. There is a
considerable positive relationship between innovation capability and company
performance, because companies with high innovation capabilities will be more effective
and productive in their business operations procedures, resulting in reduced
operating expenses. In addition, with innovation, companies have the ability to
earn business income from various service businesses, this will increase
company revenue so that the Return on Assets ratio increases.
Research results have proven
that high innovation capability can increase the level of company
profitability. Therefore, the management of PT. Angkasa
Pura Retail needs to strengthen the research and development division and
allocate sufficient budget to the R&D division so that they can more easily
carry out research activities to discover new things. Besides that, companies
also need to turn on the learning and sharing process in the corporate
environment so that employees' innovative abilities increase so that the
company's innovation capabilities increase.
Effect of Leverage on
Company Performance
The third hypothesis illustrates that leverage
produces a computed t value less than the t table (-0.5224423
< 2.365) and a significant value
more than 0.05 (0.6188 > 0.05). These findings suggest that leverage has no
influence on firm performance at PT. Angkasa Pura
Retail between 2020 and 2022. High leverage cannot yet affect company
performance.
The research results dismissed the theory expressed
by (Modigliani Miller 1963) explaining that companies that have leverage will
have higher performance than companies that do not have leverage, because the
level of leverage is high, the interest expense is also high. As revealed by (Horne
& Wachowicz in Nano 2020), financial leverage will
be unfavorable (unfavorable) occurs when the company has income from using
funds that is smaller than the fixed expenses that must be paid. The lower the
debt ratio, the better off the company. This signifies that just a tiny
fraction of the company's assets are supported by debt; the higher this ratio,
the larger the company's leverage. Inflated debt faced with weak capital
conditions caused the company to no longer focus on its main goal, which is to
generate profits. So that there is an insignificant effect because there is no
performance efficiency from the company in optimizing capital to guarantee all
of the company's debts.
This result is consistent with (Tambunan
and Prabawani's 2018) finding that leverage has no
influence on a company's financial performance. At the same time, our study
rejects (Nano's 2020) finding that financial leverage has a substantial impact
on the financial performance of PT. Japfa Comfeed Indonesia, Tbk. According
to (Prastia and Hasanah's
research 2022), leverage as measured by debt to assets has a negative influence
on company performance, which means that the more the leverage, the poorer the
company's performance. The results of the study show that the higher the debt,
the lower the company's performance, this is because companies that have large
debts will have a burden to pay interest and repay the principal of the debt,
so that the company's operational costs become larger and have an impact on
decreasing company profits.
Research results have proven that high leverage can
reduce the level of company profitability. Therefore, the management of PT. Angkasa Pura Retail needs to increase its ability to generate
profits, so that the company can use internal funding sources through retained
earnings for business development. And to reduce the level of leverage, company
management can also issue new shares to the parent company.
Effect of Liquidity on
Company Performance
The fourth hypothesis illustrates that liquidity has
a computed t value larger than the t table (2.995858
> 2.365) and a significant
value less than 0.05 (0.0241 < 0.05). These findings suggest that liquidity has a beneficial impact on
corporate performance at PT. Angkasa Pura Retail from
2020 to 2022. The high value provided by the current ratio may be stated to be
a guarantee for the firm to be able to pay off its obligations that are due
soon, because the high value of current assets is undoubtedly beneficial for
the company.
The loss of a company's opportunity to earn
additional profits is due to the use of funds required for investment which are
then reserved to fulfill the liquidity aspect of the company. In this case the
liquidity aspect is used as material in considering specifically for investors
in investing. This is because high or low liquidity has an influence on
financial performance from the company's equity side because liquidity is seen
from the current assets side. High liquidity means that the company's ability
to meet its short-term obligations is getting better. However, it can also be
understood that the company entity misses out on further earnings since funds
that should be used for beneficial investments are retained to fulfill
liquidity. As a result, liquidity is employed as a metric to measure the
effectiveness of business entities (Hermawan, 2017).
This study is consistent with previous research
conducted by (Novela et al. 2020) which has the
result that liquidity has a positive effect on financial performance. Likewise,
(Nariman 2022) states that liquidity has a positive influence on company
performance. There is a significant positive relationship between liquidity and
company performance because liquid companies can capitalize on every business
opportunity more quickly, and because companies have better cash reserves to
finance their investment activities, this has an impact on increasing company
income, resulting in an increase in ROA.
Business solutions that can be run by the management
of PT. Angkasa Pura Retail, among other things,
always ensures that the company has a minimum liquidity ratio greater than 1,
so that the company is always ready to fulfill short-term obligations, and the
company is more flexible in taking advantage of business opportunities if the
company is in a high liquidity condition.
Effect of Growth on
Company Performance
The fifth hypothesis illustrates that growth results
in a computed t value bigger than the t table (3.150990 > 2.365) and a significant value less than 0.05
(0.0198 < 0.05). These
findings suggest that growth has an influence on the company's performance at
PT. Angkasa Pura Retail from 2020 to 2022.
Sales growth represents the previous performance of
the company's operations and may be used to forecast future growth. A company's
capacity to sustain earnings and prospects will be impacted by sales growth.
The capacity of a company to sustain earnings and possibilities in the future
is dependent on the stability of its sales growth, and the firm's sales growth
is an indication of successful development. Increased sales growth can be used
as an aspect to assess that the company has increased financial performance. If
a company has a low level of sales, it will affect profits and have an impact
on a decreased level of financial performance (Sitanggang &
Pratama, n.d.).
Research on growth on financial performance that has
been carried out by (Asiandu &
Malayudha, 2022), shows the results that company growth has a
significant positive effect on company financial performance. (Fahlevi & Dewi, 2019) found that sales growth has a beneficial influence
on a company's financial performance. This is consistent with the findings of
Lutfi and (Sunardi &
Sasmita, 2019), who indicated that the variable of sales growth had a beneficial
influence on the company's financial performance. There is a large positive
association between growth and company performance because expanding companies
have income that grows year after year, implying that market share increases
year after year; this circumstance boosts corporate profits and ROA.
Business solutions that can be implemented by
company management include expanding market share, this can be done by forming
an effective sales team so that sales levels increase and the company will grow
significantly.
The Influence of Corporate
Risk, Innovation Capability, Leverage, Liquidity, and Growth on Company Performance
The first hypothesis
illustrates that corporate risk has a computed f value more than the f table
(103.10 > 4.120) and a significant value less than 0.05 (0.000 < 0.05).
These findings demonstrate that business risk, innovation capabilities, leverage,
liquidity, and growth all have a major impact on PT. Angkasa
Pura Retail's success from 2020 to 2022.
These results explain that
PT. Angkasa Pura Retail can pay attention to and
manage the five factors, namely corporate risk, innovation capability, leverage,
liquidity, and growth together so that the company's performance can be
improved.
Implementation Plan & Justification
According to the above data,
PT Angkasa Pura Retail has not been able to fully
utilize all of its potential assets to produce returns, thus this
implementation plan will place a greater emphasis on raising Return on Assets.
Tabel 6
Implementation Plan
|
Variable |
Month
and Year |
Activity
Plan |
|
Corporate
Risk |
January
- Maret 2023 |
Identify
hazards, both internal and external, to strengthen the risk management
division team. |
|
Innovation
Capability |
Maret
- Juni 2023 |
Utilize
the funds for research and development activities as much as possible by
undertaking study to find new business possibilities or product development. |
|
Leverage |
October
2023 |
Using
debt restructuring procedures to reduce the company's leverage ratio, which
lowers interest costs and boosts profitability by reducing interest expense. |
|
Liquidity |
January–
December 2023 |
Always
set aside money for idle funds so that the firm is prepared to take advantage
of opportunities whenever a new business opportunity arises. |
|
Growth |
February-November
2023 |
Increasing
market share to drive sales and promote business growth |
Based
on the results of data analysis that has been done in the previous chapter, as
well as to answer the problems of this research, the conclusions made in this
research as follows: 1. PT. Angkasa Pura Retail's performance is significantly
impacted negatively by corporate risk between 2020 and 2022. 2. PT. Angkasa Pura Retail, innovation capabilities significantly improve
company performance between 2020 and 2022. 3. From 2020 to 2022, the performance of the
company at PT. Angkasa Pura Retail is unaffected by
leverage. 4. From 2020 to 2022, PT. Angkasa Pura
Retail's performance is significantly impacted by liquidity. 5. From 2020 to
2022, growth will have a substantial beneficial impact on the corporate
performance at PT. Angkasa Pura Retail.
Anabella, Anabella, & Siregar,
Anitaria. (2022). Pengaruh Pengungkapan Sustainability Report, Leverage Dan
Activity Terhadap Kinerja Perusahaan. BALANCE: Jurnal Akuntansi, Auditing
Dan Keuangan, 19(1), 65–98.
Andersen, Torben Juul. (2008). The
performance relationship of effective risk management: Exploring the
firm-specific investment rationale. Long Range Planning, 41(2),
155–176.
Asiandu, Angga Puja, & Malayudha,
Achmad Gusti. (2022). The Bioprospecting of Mangrove Red Snapper Cultivation
(Lutjanus argentimaculatus Forsskå l, 1775) Using Floating Cages. Biology,
Medicine, & Natural Product Chemistry, 11(1), 27–33.
Fahlevi, Pahri, & Dewi,
Anthanasia Octaviani Puspita. (2019). Analisis Aplikasi Ijateng Dengan Menggunakan
Teori Technology Acceptance Model (TAM). Dalam Jurnal Ilmu Perpustakaan,
8(2).
Ghozali, Imam. (2016). Aplikasi
Analisis Multivariete IBM SPSS 23, Badan Penerbit Universitas Diponegoro,
Semarang. 2016. Aplikasi Analisis Multivariate Dengan Program IBM SPSS, 23.
Gupta, Pankaj Kumar. (2011). Risk
management in Indian companies: EWRM concerns and issues. The Journal of
Risk Finance, 12(2), 121–139.
Hayter, Anthony J. (1986). The
maximum familywise error rate of Fisher’s least significant difference test. Journal
of the American Statistical Association, 81(396), 1000–1004.
Hwang, Wu Yuin, Chen, Holly S. L.,
Shadiev, Rustam, Huang, Ray Yueh Min, & Chen, Chia Yu. (2014). Improving
English as a foreign language writing in elementary schools using mobile devices
in familiar situational contexts. Computer Assisted Language Learning, 27(5),
359–378.
Mabasa, Peace Nhlawutelo. (2022). Selected
motivational variables that influence spectator attendance of professional
woman’s soccer matches. Vaal University of Technology.
Mardiana, Mardiana, &
Purnamasari, Puji Endah. (2018). The effect of risk management on financial
performance with good corporate governance as a moderation variable. Management
and Economics Journal (Mec-J), 2(3), 257–268.
Phillips, Robert, Freeman, R. Edward,
& Wicks, Andrew C. (2003). What stakeholder theory is not. Business
Ethics Quarterly, 13(4), 479–502.
Sitanggang, Laura Sabatini, &
Pratama, Arie. (n.d.). Covid-19 Related Disclosures And Firm Value: Evidence
From Indonesia. Jurnal Pendidikan Akuntansi & Keuangan, 10(2),
42–55.
Sugiyono. (2018). Metode Penelitian
Kuantitatif, Kualitatif, dan R&D. Bandung: Alfabeta.
Sugiyono, F. X. (2017). Instrumen
Pengendalian Moneter: Operasi Pasar Terbuka (Vol. 10). Pusat Pendidikan Dan
Studi Kebanksentralan (PPSK) Bank Indonesia.
Sunardi, Nardi, & Sasmita, Anisa
Sari. (2019). Pengaruh Likuiditas, Leverage Dan Growth Terhadap Kinerja
Industri Makanan Dan Minuman Yang Tercatat Di Indonesia Stock Exchange Selama
Periode Tahun 2011-2015. Jurnal Sekuritas, 2(2), 83.