FINANCIAL PROFITABILITY OF DEMERGED COMPANIES

The paper presents a complete analysis of the evolution of the profitability of some Romanian companies that decided to demerge in 2013. The sample of companies was analyzed with statistical and econometric methods of panel data, in the sub-periods before and after demerger: 2005-2013 and 2014-2019. The main objective of research was to find out if the organizational management strategy was beneficial for obtainingbetter economic and financial performance. The research results were extended to the population to characterize the financial situation of all Romanian companies in the same situation as those in the sample

Financial Analysis of the Private Organic Farm: Sanga Agro Farm

The study was regulated to find out the financial profitability of private organic farm of Sanga, Kavre. The study is based on both primary and secondary sources of data. The collected data using interview were analyzed by presenting them on table and interpreted through Benefit Cost Ratio (BCR) in 10 percent discount rate. For this, all figures were converted into Net Present Value (NPV) of Nepalese rupees. The findings of the study showed that the BCR was greater than one such as 1.47 ratios (BCR>1). The BCR value showed that the farm has contributed to increase more profit of owner by selling their farm’s products. The project of organic items: beans and garden cress was able to produce fresh items, provide space for employment. These organic products supported human health, soil health, and maintained conducive environment.

Sustainable Circular Bioeconomy—Feasibility of Recycled Nutrients for Biomass Production within a Pulp and Paper Integration in Indonesia, Southeast Asia

Sustainable biomass production based on efficient carbon and nutrient recycling is crucial in materially efficient, sustainable biobased production. A circular bioeconomy model of the replacement of mineral fertilizers with recycled nutrients from pulp and paper mill sludge is tested here within a hypothetical case from Indonesia, Southeast Asia. First, the financial feasibility of the use of recycled nutrients originating from pulp and paper processes was analyzed in fast-growing pulpwood production. Secondly, the comprehensive social and environmental benefits of the practice were analyzed through qualitative sustainability analysis. The availability of the basic material of all required parameters referring to Indonesia limited the analysis period to be from 1996 to 2013. The establishment costs of a pulpwood plantation were adjusted according to a reference study, while the other data were compiled from various sources. The financial profitability of the circular model was analysed by using two indicators, net present value (NPV) and internal rate on return (IRR). The application of sludge-based recycled nutrients slightly increased the establishment costs in some circumstances but had no direct impact on the financial profitability, as the financial profitability was not sensitive to the establishment costs. The results showed that the financial profitability of biomass production is not sensitive to the plantation establishment and management costs. The profitability depends on the mean annual increment and product price. The qualitative analysis showed a holistic value of the practice that goes beyond the direct benefits. The use of sludge-based recycled nutrients in the production of pulpwood closed the economic loop, which is illustrative of the circular bioeconomy within the integrated pulp and paper sector including the raw material source, forest plantation.

Is Innovation a Driver of Sustainability? An Analysis from a Spanish Region

1. Background. It is well-known that innovation contributes to economic growth, improves productivity and enables competitive advantage. However, beyond these matters, it would be of interest to know what role innovation plays in relation to sustainability. This paper focuses on whether innovation is a driver of sustainability in its three dimensions: social, economic and environmental. 2. Methods. The study was conducted with companies in the Valencian community (Spain) to analyze whether they significantly contribute to sustainability as innovators. Economical sustainability was assessed based on economic and financial profitability; social sustainability was assessed by employment generation. To determine whether companies contributed to environmental sustainability, we considered those which, apart from a reputation (“label”) in innovation, had some kind of environmental certification. 3. Results. Our results indicate that innovative companies are more profitable and generate more employment. However, there are no differences in terms of performance and employment generation between innovative companies and those that are also environmentally sensitive. 4. Conclusion. Innovation is a driving force of economic and social sustainability in the studied area, but environmental sensitivity is not a driver for economic and social sustainability.

Forecasting Variations in Profitability and Silviculture under Climate Change of Radiata Pine Plantations through Differentiable Optimization

Climate change might entail significant alterations in future forest productivity, profitability and management. In this work, we estimated the financial profitability (Soil Expectation Value, SEV) of a set of radiata pine plantations in the northwest of Spain under climate change. We optimized silvicultural interventions using a differentiable approach and projected future productivity using a machine learning model basing on the climatic predictions of 11 Global Climate Models (GCMs) and two Representative Concentration Pathways (RCPs). The forecasted mean SEV for future climate was lower than current SEV (∼22% lower for RCP 4.5 and ∼29% for RCP 6.0, with interest rate = 3%). The dispersion of the future SEV distribution was very high, alternatively forecasting increases and decreases in profitability under climate change depending on the chosen GCM. Silvicultural optimization considering future productivity projections effectively mitigated the potential economic losses due to climate change; however, its ability to perform this mitigation was strongly dependent on interest rates. We conclude that the financial profitability of radiata pine plantations in this region might be significantly reduced under climate change, though further research is necessary for clearing the uncertainties regarding the high dispersion of profitability projections.

Inversión ecoeficiente: efectos sobre el desempeño económico y financiero de los grupos empresariales del Dow Jones Sustainability World Index

El impacto de la actividad económica sobre el medio ambiente es innegable, causando daños irreparables. Por lo anterior, la inversión en eficiencia en emisiones es una de las soluciones al problema. En la revisión de la literatura se observan efectos dispares entre la inversión asociada a comportamientos ecoeficientes y la rentabilidad económica-financiera de las empresas. El objetivo del estudio fue aportar mayor evidencia empírica sobre estos efectos. Se utilizó un panel de datos balanceado para una muestra de 57 grupos empresariales, líderes europeos cotizados, para los años 2012-2015. Los resultados desvelan una relación positiva entre los niveles de ecoeficiencia y el desempeño económico-financiero. Las recompensas alcanzadas por los grupos empresariales, por la mejora de sus resultados y a través de los mercados financieros, deberían facilitar la aplicación de normativas con el objetivo de reducir el impacto de la actividad empresarial sobre el medioambiente. The impact of economic activity on the environment is undeniable, causing irreparable damage. Thus, investment in emission efficiency is one of the solutions to the problem. A review of the literature shows disparate effects between investment associated with eco-efficient behaviour and the economic-financial profitability of companies. The aim of the study was to provide more empirical evidence on these effects. A balanced data panel was used for a sample of 57 large groups of listed companies for the years 2012-2015. The results reveal a positive relationship between eco-efficiency levels and economic-financial performance. The rewards achieved by companies for improving their results and through financial markets should facilitate the application of regulations with the aim of reducing the impact of business activity on the environment.

Does CSR Affect the Profitability and Valuation of Energy Companies? An Example from Poland

The article refers to the issues of financial profitability of undertaking CSR activities, which is widely reported in literature. The four largest electricity producing companies in Poland were selected for the analysis. The research period covers the years 2009–2019, when the index of socially responsible companies was operating on the Warsaw Stock Exchange. The main purpose of the article is to compare the profitability ratios and quotations of energy companies in Poland declaring themselves socially responsible with companies of the same sector that have not expressed such a declaration. The results obtained on the basis of descriptive statistics, concerning profitability ratios and stock market quotations, indicate no relationship between their level and stability and the companies’ declarations of compliance with social responsibility. Companies declaring themselves socially responsible were placed in the ranking between the results of companies that did not belong to the indicated index. This may be the result of the specific situation of energy companies in Poland.

Profitability and Technical Efficiency of Soybean Producers in the Municipality of Tanguiéta in Benin

This study was carried out in the year November 2020. The general objective of this study was to assess the profitability and Technical efficiency of soybean producers in the municipality of Tanguiéta. A survey of a sample of 184 producers was selected at random in Center of Tanguiéta, Taïacou, Cotiakou, N’Dahonta and Tanongou of the municipality. In order to analyze the financial profitability of soybean production, the interviews focused on data in order to estimate the technical efficiency scores of each producer and to establish the operating account of the sampled producers. Thus, the most efficient and the average or weakly efficient producers whose technical efficiency scores are less than or equal to 50%. Gross margin, yield, value added per hectare and profit to production cost ratio were estimated. The results showed that the technical efficiency indices of the producers surveyed varied between 11% and 91.1% with an average of 45.62%. Soybean production is financially profitable depending on the level of technical efficiency although the yields obtained are very low for each of the groups. The profit to cost of production ratio revealed that the group of the most efficient producers has the best ratio (1.18> 0.93), showing that soybean producers are technically inefficient overall. With regard to the indicators, they are far from the production potential expected in Benin.

Are small and medium-size food industry firms profitable? Explaining differences in their performance: The case of the Valencia Region

The main aim of this study was to determine the factors that influenced profitability of companies involved in the Valencia food industry between 2006 and 2015. For this, macroeconomic, sector and company variables were the key elements used in the statistical analysis, together with their dependenceon the economic cycle in indicating the present state of the sector in the Valencian Region. The panel data was obtained from the sabi data base and combined with transverse data and time series. Economic and financial profitability are both influenced by certain common factors, especially the sales margin. The higher the margin the higher the profit, although this relationship also depends on where the business company is located. Rotation of assets also contributes to raising profits in times of economic expansion. The Economic Crisis saw profits fall in 2009 and 2012, two of its worst years. Finally, differences were also found between large and small enterprises.

Impact of Priority Sector Lending on Financial Profitability: Segment Wise Panel Data Analysis of Indian Banks

A sustainable and financially stable banking system is a prerequisite to achieve comprehensive growth as well as economic and social well-being of residents of any country. This research focused on analyzing profitability of Indian banks and how it is affected by lending in the priority sector. Priority sector lending (PSL) mainly includes deployment of credit to weaker and neglected segments of an economy. The study adopted a distinctive measure to represent total PSL by classifying it into four sub-segments i.e., agriculture, industrial, service, and personal credit. Applying panel least square regression with fixed and random effects model, the study concluded that agricultural lending has a significant negative impact on bank profitability whereas the service sector lending adds positive value towards financial profitability of banks. Industrial and personal credit were found to be insignificant factors affecting profitability. The study will be beneficial to banking professionals and policy makers to determine sensitive and risky sectors of lending and develop appropriate approaches to deal with them.