MEASURING FINANCIAL PERFORMANCE OF CEMENT INDUSTRY DURING INFRASTRUCTURE DEVELOPMENT IN INDONESIA

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Daryanto, Wiwiek Mardawiyah (2018) MEASURING FINANCIAL PERFORMANCE OF CEMENT INDUSTRY DURING INFRASTRUCTURE DEVELOPMENT IN INDONESIA. South East Asia Journal of Contemporary Business, Economics and Law, 16 (1). pp. 44-56. ISSN 2289-1560

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Abstract

Infrastructure development is currently one of the main concerns of the Indonesian government. The increase of development projects across Indonesia will consequently require cement companies to increase their production capacity and performance. It has been perceived by the increase of cement sales volume of 48 million tons in 2011 to 62 million tons in 2016. This study aims to analyze and measure the financial health conditions of two State-Owned Enterprises (SOEs) cement industries for periods of 2011 to 2015. The Decree No.KEP-100/MBU/2002 issued by Indonesia Ministry of SOEs in June 2002 provides the mandatory of measuring and rating of the SOEs financial health condition. The results of eight financial ratios investigating; 1) return on equity, 2) return on investment, 3) cash ratio, 4) current ratio, 5) collection period, 6) inventory turnover, 7) total asset turnover, 8) total equity to total asset, then be validated by the said Ministry of SOEs Decree to conclude the yearly financial health conditions of each SOEs. The result shows that from 2011 - 2015, both SOEs have achieved financial healthy condition levels and rating as follows; PT. Semen Baturaja (A, AAA, AA, A, and AA); and PT. Semen Indonesia (AA, AAA, AA, AA, and AA) respectively. This study has added the knowledge in the financial literature. It also gives a strong insight for managers in cement industry about the financial performance. Therefore, the managers could make decisions to increase the market share and the profitability. Keywords: financial performance, financial ratios, SOEs, cement

Item Type: Article
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HF Commerce > HF5601 Accounting
H Social Sciences > HG Finance
Divisions: Research And Community Empowerment > Journals
Depositing User: Rizky Amalia
Date Deposited: 17 Jan 2020 11:01
Last Modified: 22 Dec 2021 04:12
URI: http://repository.ipmi.ac.id/id/eprint/430

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