Profitability in Non-Public Palm Oil Companies: The Role of Liquidity, Capital Structure, and Asset Structure
- Sius Universitas Indonesia Membangun, Bandung, Indonesia
-
Meiliani Luckieta
*
Nusa Putra University, Sukabumi,
Indonesia
- Reni Nurlaela Universitas Putra Indonesia, Cianjur, Indonesia
Abstract
This study aims to examine the effects of liquidity, capital structure, and asset structure on profitability in a non-public palm oil company. Profitability is measured using Return on Assets (ROA), while liquidity, capital structure, and asset structure are proxied by the Current Ratio (CR), Debt-to-Equity Ratio (DER), and Fixed Asset Ratio (FAR), respectively. The study is motivated by the phenomenon of declining profitability despite increases in liquidity, leverage, and fixed asset proportions during the observation period. A quantitative approach with a single-case study design was employed using secondary data obtained from the company’s financial statements covering the period 2013–2024. Data were analyzed using descriptive statistics and multiple linear regression after satisfying the classical assumption tests. The results indicate that liquidity (CR) does not significantly affect profitability (t = -2.099; p = 0.069), while capital structure (DER) also shows no significant effect on profitability (t = 0.167; p = 0.871). In contrast, asset structure (FAR) has a significant negative effect on profitability (t = -2.802; p = 0.023). Simultaneously, liquidity, capital structure, and asset structure do not significantly affect profitability (F = 3.800; p = 0.058). The regression model explains 58.8% of the variation in profitability (R² = 0.588), with an adjusted R² of 0.433. These findings suggest that excessive investment in fixed assets, without corresponding improvements in operational efficiency, may reduce profitability. This study contributes to the limited literature on profitability determinants in non-public palm oil companies and provides practical implications for improving financial management and asset utilization efficiency.
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