The Effect of Financial Performance and Innovation on Leverage: Evidence from Indonesian Food and Beverage Sector

Abstract


 
 
 This article aims to investigate the determinants of firm’s capital structure (debt ratio) such as asset structure, profitability, agency cost, innovation and technology, and firm size as a moderating variable. This study used quarterly data from the financial statements of food and beverage firms at the Indonesia Stock Exchange with a purposive sampling method that met the research criteria with panel data analysis. The findings show that firm size and asset structure affect leverage positively; however, profitability and innovation and technology negatively affect the debt ratio, while agency cost does not affect leverage. All findings are in line with the hypotheses except agency cost. The firm size as a moderating variable shows strengthening of the interaction between agency cost and innovation with leverage. However, interacting with firm size weakens the effect of the relationship between assets structure and profitability with the debt ratio. Managerial implications of the target of debt ratio that creates the value of the firm need to be flexible and controlled by the interaction of the firm size with firm characteristics and innovation to achieve an optimal firm value of F & B sector.
 
 

The Relationship between Innovation Capital, Firm Value, and Firm Risk

“…The study's first hypothesis is as follows: H1: Innovation capital has a positive effect on firm value The study's second objective was to examine the relationship between innovation capital and firm risk. It is expected that innovation will enable the company to achieve a favorable position, particularly in terms of reducing firm risk and the threat of bankruptcy due to the failure of continuous innovation (Santosa, 2020). On the other hand, all forms of innovation capital investment and development will invariably involve firm risks.…”

“…Today, innovation is crucial. The objectives of innovation are to create added value for the organization, gain a competitive edge, strengthen the organization's market position, shape demand responses, and increase customer satisfaction (Bardhan et al, 2013;Dotzel et al, 2013;Kijkasiwat & Phuensane, 2020;Rubera & Kirca, 2012;Ruggiero et al, 2021;Santosa, 2020;Sorescu & Spanjol, 2008). According to Kamasak (2015), the development of innovative products and services has become an important part of achieving and maintaining the competitiveness of organizations in the global market.…”

Pengaruh Struktur Aset dan Biaya Keagenan Terhadap Kebijakan Hutang Dimediasi dengan Profitabilitas

“…Faktor terpenting yang harus dipikirkan oleh perusahaan subsektor makanan dan minuman yaitu aspek modal yang cukup besar. Aspek struktur permodalan sangat erat kaitannya dengan kegiatan usaha dan masalah keuangan yang disebabkan oleh perusahaan yang berjalan dan berkembang dengan baik, apabila manajemen memiliki modal yang layak sesuai dengan pembesaran usaha dan kebutuhan modal kerjanya (Santosa, 2020). Namun, dengan semakin terbatasnya sumber dana pihak internal perusahaan dalam mengembangkan bisnis perusahaan, manajemen juga harus mendapatkan pendanaan eksternal yang berbeda seperti melalui pinjaman bank dan pasar modal (Horvathova et al, 2018).…”

“…Terdapat penelitian sebelumnya yang menganalisis pengaruh kinerja keuangan dan inovasi terhadap leverage dibuktikan dari subsektor makanan dan minuman di Indonesia (Santosa, 2020). Hasilnya memperlihatkan ukuran perusahaan dan struktur kualitas mempengaruhi leverage secara positif.…”

“…Kebijakan hutang (Leverage) ialah kemampuan suatu perusahaan untuk menggunakan dana (aset) untuk memanfaatkan jumlah keuntungan finansial (pengembalian) bagi para pemilik perusahaan (Dewi & Abundanti, 2019). Kebijakan hutang dalam struktur modal yang dilakukan manajemen, selain dipengaruhi oleh biaya modal tertimbang itu sendiri, dikatakan sebagai faktor alternatif yang biasanya akan berpengaruh pada sumber pendanaan, seperti ukuran perusahaan, pembayaran dividen, penjualan, aktiva perusahaan, pertumbuhan perusahaan, profitabilitas, keuntungan pajak, target leverage, likuiditas, risiko bisnis dan tata kelola perusahaan itu sendiri (Santosa, 2020). Dimensi perusahaan ialah hal yang krusial yang dipertimbangkan dalam membuat pilihan mengenai struktur modal.…”