 BANKRUPTCY PREDICTION IN THE CROATIAN RESTAURANT INDUSTRYEconomic Thought and Practice, 2021, vol. 30, issue 1, 99-119 Abstract: The purpose of this paper is to explore the possibility of predicting bankruptcy of restaurants in Croatia. The research was conducted in the period from 2017 to 2019 on a sample of 297 bankrupt and 308 non-bankrupt companies which belong to sector I subdivision 5610 — Restaurants and mobile food service activities. The two-factor model was estimated by logistic regression and it showed prediction accuracy of 82.8% one year prior to bankruptcy, 76.7% two years prior to bankruptcy and 76.4% three years prior to bankruptcy. The model suggested that the equity ratio (which shows the proportion of assets which is financed by equity) and the EBITDA margin (which shows company’s EBITDA as a percentage of its operating income), play an important role in predicting restaurant bankruptcy. This paper provides new insights into the assessment of restaurant bankruptcy prediction in Croatia. Keywords: logistic regression; logit; financial indicators; restaurant bankruptcy (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:avo:emipdu:v:30:y:2021:i:1:p:99-119 Ordering information: This journal article can be ordered from Access Statistics for this article Economic Thought and Practice is currently edited by Nebojsa Stojcic More articles in Economic Thought and Practice from Department of Economics and Business, University of Dubrovnik Contact information at EDIRC. |
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