The Firm-Specific Determinants of Capital Structure in Beverage Industry in Europe

İlhan Dalci (), Hasan Ozyapici () and Doğan Unlucan ()
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İlhan Dalci: Eastern Mediterranean University
Hasan Ozyapici: Eastern Mediterranean University
Doğan Unlucan: Eastern Mediterranean University

A chapter in Global Issues in Banking and Finance, 2019, pp 161-172 from Springer

Abstract: Abstract This study investigates the firm-specific capital structureCapital structure determinants for the listed firms operating in the beverage industryBeverage industry in Europe. The financial data related to the period 2010–2018 are obtained from Orbis. A total of 83 companies with 747 observations are used. According to the results, profitabilityProfitability is negatively correlated with total debtDebt ratio, long-term debtDebt ratio, and short-term debt ratio. Tangibility and liquidity are also negatively correlated with both total debt ratio and short-term debt ratio. Also, it is found that growth has a statistically significant negative impact on both total debt ratio and long-term debt ratio. On the other hand, the results underline that non-debt tax-shield is positively correlated with total debt ratio and short-term debt ratio. Similarly, size is positively correlated with both total debt ratio and long-term debt ratio. To sum up, growth, tangibility, liquidity, profitabilityProfitability, size, and non-debt tax shield have statistically significant influences on debtDebt ratios. This study may help managers and policy makers interested in capital structureCapital structure determinants to make accurate decisions. Creditors may also utilize this study to analyze the capital structureCapital structure of borrowers while they are considering the issues related to lending money.

Keywords: Beverage industry; Capital structure; Debt; Profitability (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-030-30387-7_11

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DOI: 10.1007/978-3-030-30387-7_11

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