Petra International journal of Business Studies (IJBS)
Vol 2 No 2 (2019): DECEMBER 2019

The Effect of Company Performance on Dividend Policy in Manufacturing Companies

Kusuma, Onny (Unknown)
Semuel, Hatane (Unknown)

Article Info

Publish Date
01 Nov 2019


Companies in managing their finances are always faced with three important issues that are interrelated. The three problems are investment decisions, funding decisions and dividend policy decisions. This study will be focusing on dividend policy decision. Not all companies distribute dividend even when they have high profit/liquidity level or because they need money to pay interest. This study investigates and aim to analyze the effect of company performance to dividend policy in manufacturing companies. Company performance used as variables are: profitability, leverage, and liquidity. The author will analyze the direct effect from profitability, leverage, and liquidity with company dividend policy. After that by using liquidity as moderating variable, the author will analyze wether high liquidity level can strengthen company decision to distribute dividends. The sample for this study are 77 manufacturing industry companies listed on the Indonesia Stock Exchange in 2010-2016 which distributed dividends. Research data is taken from annual financial report data published by the sample companies. The data in this study were processed with the help of SEM smartPLS 3.0 model. This study explains the impact of profitability, leverage, and liquidity factors on dividend policy and wether liquidity can be used to strengthen or weaken the relationship between profitability to dividend policy and leverage to dividend policy.

Copyrights © 2019

Journal Info





Decision Sciences, Operations Research & Management Economics, Econometrics & Finance


Petra IJBS (Petra International Journal of Business Studies, ISSN: 2621-6426) is a peer-reviewed journal published under the Master of Management program, Faculty of Economics, Petra Christian University (MM FE UKP). The journal serves as a vessel for exchanging business knowledge to scholars and ...