Working capital management and profitability of manufacturing companies in Kosovo
This article aims to demonstrate the profitability of the manufacturing companies in Kosovo impacted by the managing practices in the working capital. We use multiple regression analyses to estimate the effect of working capital indicators on profit. The Pearson correlation is used to calculate whet...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
University of Split, Faculty of Economics
2021-01-01
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| Series: | Management : Journal of Contemporary Management Issues |
| Subjects: | |
| Online Access: | https://hrcak.srce.hr/file/388685 |
| _version_ | 1827282190301396992 |
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| author | Amant Fejzullahu Florije Govori |
| author_facet | Amant Fejzullahu Florije Govori |
| author_sort | Amant Fejzullahu |
| collection | DOAJ |
| description | This article aims to demonstrate the profitability of the manufacturing companies in Kosovo impacted by the managing practices in the working capital. We use multiple regression analyses to estimate the effect of working capital indicators on profit. The Pearson correlation is used to calculate whether the variables are positively or negatively correlated and to what extent. The sample includes thirty-six manufacturing companies for the period 2012-2013. The data show that the increase in cash conversion cycle (CCC) and extension in the receivables term positively influenced operating profit and net return on assets. On the contrary, the increase in payables days had a negative effect on the operating profit and the net return on assets. The rise in inventory days led to increased profit. Therefore, the companies' competitiveness is maintained mainly by extending trade credit terms to their customers and keeping the cash engaged longer in operating activities. |
| first_indexed | 2024-04-24T09:13:56Z |
| format | Article |
| id | doaj.art-935623a27b6c4632bf79b4fe404287ab |
| institution | Directory Open Access Journal |
| issn | 1331-0194 1846-3363 |
| language | English |
| last_indexed | 2024-04-24T09:13:56Z |
| publishDate | 2021-01-01 |
| publisher | University of Split, Faculty of Economics |
| record_format | Article |
| series | Management : Journal of Contemporary Management Issues |
| spelling | doaj.art-935623a27b6c4632bf79b4fe404287ab2024-04-15T17:23:10ZengUniversity of Split, Faculty of EconomicsManagement : Journal of Contemporary Management Issues1331-01941846-33632021-01-0126227729410.30924/mjcmi.26.2.16Working capital management and profitability of manufacturing companies in KosovoAmant Fejzullahu0Florije Govori1NewCo Switzerland SAFaculty of Economics, University of Prizren “Ukshin Hoti”This article aims to demonstrate the profitability of the manufacturing companies in Kosovo impacted by the managing practices in the working capital. We use multiple regression analyses to estimate the effect of working capital indicators on profit. The Pearson correlation is used to calculate whether the variables are positively or negatively correlated and to what extent. The sample includes thirty-six manufacturing companies for the period 2012-2013. The data show that the increase in cash conversion cycle (CCC) and extension in the receivables term positively influenced operating profit and net return on assets. On the contrary, the increase in payables days had a negative effect on the operating profit and the net return on assets. The rise in inventory days led to increased profit. Therefore, the companies' competitiveness is maintained mainly by extending trade credit terms to their customers and keeping the cash engaged longer in operating activities.https://hrcak.srce.hr/file/388685financial performancemanufacturing companiesmanagementworking capitalprofitability |
| spellingShingle | Amant Fejzullahu Florije Govori Working capital management and profitability of manufacturing companies in Kosovo Management : Journal of Contemporary Management Issues financial performance manufacturing companies management working capital profitability |
| title | Working capital management and profitability of manufacturing companies in Kosovo |
| title_full | Working capital management and profitability of manufacturing companies in Kosovo |
| title_fullStr | Working capital management and profitability of manufacturing companies in Kosovo |
| title_full_unstemmed | Working capital management and profitability of manufacturing companies in Kosovo |
| title_short | Working capital management and profitability of manufacturing companies in Kosovo |
| title_sort | working capital management and profitability of manufacturing companies in kosovo |
| topic | financial performance manufacturing companies management working capital profitability |
| url | https://hrcak.srce.hr/file/388685 |
| work_keys_str_mv | AT amantfejzullahu workingcapitalmanagementandprofitabilityofmanufacturingcompaniesinkosovo AT florijegovori workingcapitalmanagementandprofitabilityofmanufacturingcompaniesinkosovo |