Determinants of capital structure for retailing firms on the JSE
- Authors: Tazvivinga, Julie Elsie
- Date: 2019
- Subjects: Corporations - Finance , Johannesburg Stock Exchange
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/423735 , uj:36211
- Description: Abstract: Though capital structure studies have become increasingly important in the field of finance, very few studies have been carried out in developing countries. Research has shown that capital structure determinants can be industry specific. The main purpose of this study is to examine the determinants of capital structure for listed retailing firms on the JSE, a securities exchange market in South Africa. Building on previous capital structure studies, the main research question was formulated as: What are the factors that influence the capital structure of listed retailing firms on the JSE? A panel regression analysis was used with growth opportunities, tangibility, liquidity, firm size, firm age and profitability as independent variables, and capital structure as the dependent variable. Quantitative data was collected across 17 retailing firms listed on the JSE from 2009 to 2018. Results indicate firm size, firm age, profitability, growth opportunities and tangibility as the significant determinants of capital structure for listed retailing firms. Support is shown for both the trade-off theory and pecking order theory. Liquidity was found to be insignificant. , M.Com. (Finance)
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- Authors: Tazvivinga, Julie Elsie
- Date: 2019
- Subjects: Corporations - Finance , Johannesburg Stock Exchange
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/423735 , uj:36211
- Description: Abstract: Though capital structure studies have become increasingly important in the field of finance, very few studies have been carried out in developing countries. Research has shown that capital structure determinants can be industry specific. The main purpose of this study is to examine the determinants of capital structure for listed retailing firms on the JSE, a securities exchange market in South Africa. Building on previous capital structure studies, the main research question was formulated as: What are the factors that influence the capital structure of listed retailing firms on the JSE? A panel regression analysis was used with growth opportunities, tangibility, liquidity, firm size, firm age and profitability as independent variables, and capital structure as the dependent variable. Quantitative data was collected across 17 retailing firms listed on the JSE from 2009 to 2018. Results indicate firm size, firm age, profitability, growth opportunities and tangibility as the significant determinants of capital structure for listed retailing firms. Support is shown for both the trade-off theory and pecking order theory. Liquidity was found to be insignificant. , M.Com. (Finance)
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The impact of capital structure on the profitability of the industrial metals and mining sector on the JSE
- Authors: Sibanda, Mthokozisi
- Date: 2019
- Subjects: Capital investments , Corporations - Finance , Mineral industries - South Africa , Metals
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/402989 , uj:33749
- Description: Abstract : The study seeks to investigate the relationship between company capital structure and profitability with special reference to the industrial metals and mining industry of South Africa. Out of the 22 companies listed on the Johannesburg Stock Exchange under the industrial metals and mining industry, 14 companies were selected to be analysed in this study. Secondary data in the form of published financial statements relating to the period 1994 to 2017 of the selected companies was used. The study used return on equity (ROE), net profit margin (NPM), and return on assets (ROA) as proxies for profitability (dependent variables), while short-term to total debt (STDTA) ratio, long term as a ratio of total assets (LTDTA), and the total debt as a ratio of total assets (TTDTA) were used as proxies for capital structure (independent variables). The study employed panel data regression with pooled, random effects and fixed effects regression; however, the fixed effects regression was found to be the most appropriate. The results indicate that short-term debt is statistically insignificant as an independent variable of company profitability. Long-term debt was found to be more significant as a determinant of profitability for companies listed in the industrial metals and mining industry on the JSE. The results of the study show that the profitability of companies listed in the industrial metals and mining industry on the JSE is negatively related to the use of long-term debt over the period 1994 to 2017, implying that an increase in the company’s long-term debt would adversely affect the return of shareholders. , M.Com. (Finance)
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- Authors: Sibanda, Mthokozisi
- Date: 2019
- Subjects: Capital investments , Corporations - Finance , Mineral industries - South Africa , Metals
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/402989 , uj:33749
- Description: Abstract : The study seeks to investigate the relationship between company capital structure and profitability with special reference to the industrial metals and mining industry of South Africa. Out of the 22 companies listed on the Johannesburg Stock Exchange under the industrial metals and mining industry, 14 companies were selected to be analysed in this study. Secondary data in the form of published financial statements relating to the period 1994 to 2017 of the selected companies was used. The study used return on equity (ROE), net profit margin (NPM), and return on assets (ROA) as proxies for profitability (dependent variables), while short-term to total debt (STDTA) ratio, long term as a ratio of total assets (LTDTA), and the total debt as a ratio of total assets (TTDTA) were used as proxies for capital structure (independent variables). The study employed panel data regression with pooled, random effects and fixed effects regression; however, the fixed effects regression was found to be the most appropriate. The results indicate that short-term debt is statistically insignificant as an independent variable of company profitability. Long-term debt was found to be more significant as a determinant of profitability for companies listed in the industrial metals and mining industry on the JSE. The results of the study show that the profitability of companies listed in the industrial metals and mining industry on the JSE is negatively related to the use of long-term debt over the period 1994 to 2017, implying that an increase in the company’s long-term debt would adversely affect the return of shareholders. , M.Com. (Finance)
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The relationship between corporate governance board characteristics and financial performance of South African JSE listed companies in the construction and building materials sector
- Authors: Jingura, Netsayi Landie
- Date: 2019
- Subjects: Corporate governance , Corporations - Finance , Johannesburg Stock Exchange
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/403161 , uj:33770
- Description: Abstract : The relationship between corporate performance and governance practices goes back for centuries yet is still relevant today, in the modern corporate environment. While corporate governance is argued to be an agency cost, as it curbs managers’ self-interest, it is believed to increase company performance as it inspires group effort from all stakeholders. Corporate governance describes the mechanisms in place to ensure that management is taking appropriate steps, policies and procedures to protect every stakeholder’s interest in the company. The study is an investigation on the relationship between corporate governance board of directors and company performance. Board of directors’ characteristics were represented by board size, board independence, Chief Executive Officer (CEO) tenure, CEO compensation and CEO duality while company performance measures were represented by Return on Equity (ROE), Return on Assets (ROA) and Net Profit Margin (NPM). The study used panel regression analysis to estimate a sample of 12 South African public companies in the construction and building materials sector of the Johannesburg Stock Exchange for the period of 2011 to 2016. The size and leverage of a company were considered as control variables. The findings indicated no significant relationship between board independence, board size and CEO duality but did find a direct significant relationship between CEO tenure and CEO remuneration and company performance. The research also found a statistically significant inverse relationship between leverage and company size and performance of the company. This research is a useful aid to the comprehension of board characteristics affecting company performance in South Africa and improving corporate governance principles to eliminate corporate scandals that are crippling economies globally. , M.Com. (Finance)
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- Authors: Jingura, Netsayi Landie
- Date: 2019
- Subjects: Corporate governance , Corporations - Finance , Johannesburg Stock Exchange
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/403161 , uj:33770
- Description: Abstract : The relationship between corporate performance and governance practices goes back for centuries yet is still relevant today, in the modern corporate environment. While corporate governance is argued to be an agency cost, as it curbs managers’ self-interest, it is believed to increase company performance as it inspires group effort from all stakeholders. Corporate governance describes the mechanisms in place to ensure that management is taking appropriate steps, policies and procedures to protect every stakeholder’s interest in the company. The study is an investigation on the relationship between corporate governance board of directors and company performance. Board of directors’ characteristics were represented by board size, board independence, Chief Executive Officer (CEO) tenure, CEO compensation and CEO duality while company performance measures were represented by Return on Equity (ROE), Return on Assets (ROA) and Net Profit Margin (NPM). The study used panel regression analysis to estimate a sample of 12 South African public companies in the construction and building materials sector of the Johannesburg Stock Exchange for the period of 2011 to 2016. The size and leverage of a company were considered as control variables. The findings indicated no significant relationship between board independence, board size and CEO duality but did find a direct significant relationship between CEO tenure and CEO remuneration and company performance. The research also found a statistically significant inverse relationship between leverage and company size and performance of the company. This research is a useful aid to the comprehension of board characteristics affecting company performance in South Africa and improving corporate governance principles to eliminate corporate scandals that are crippling economies globally. , M.Com. (Finance)
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The impact of dividend policy on share price volatility of JSE ALTX listed companies
- Authors: Pelcher, Lydia
- Date: 2017
- Subjects: Stocks - Prices , Dividends , JSE Limited , Johannesburg Stock Exchange , Corporations - Finance , Financial risk management
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/245925 , uj:25483
- Description: M.Com. (Financial Management) , Abstract: Share prices and dividends were considered as important factors in creating and increasing shareholders’ wealth. In some theories it was indicated that the existence of a relationship between share prices and dividends could be questioned. More important for companies and investors was the determination of a relationship between share price volatility and dividends. If such a relationship existed, companies could structure their dividend policy decisions to attain minimum share price volatility in order to attract maximum investor interest. This was especially important to small and medium-sized companies finding themselves in the early growth phase. The aim of this study was to determine whether a relationship existed between share price volatility and dividend policy for companies listed on the Alternative Exchange (AltX) on the Johannesburg Stock Exchange Limited (JSE Ltd). Dividend policy was measured through dividend yield and the dividend pay-out ratio. Share price volatility was regressed against dividend yield and the dividend pay-out ratio using panel data regression analysis to achieve this aim. Share price volatility was found to have a statistically significant and negative relationship with dividend yield, and a statistically insignificant relationship with the dividend pay-out ratio. The results indicated that a company could possibly reduce the share price volatility by using the dividend policy by declaring dividends, although the amount of dividends in relation to earnings were of little importance to investors of small to medium-sized companies. The results of this study therefore provided information that such companies could use to structure their dividend policy in such a way that share price volatility risk would be minimised, which in turn would promote optimum growth for investors.
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- Authors: Pelcher, Lydia
- Date: 2017
- Subjects: Stocks - Prices , Dividends , JSE Limited , Johannesburg Stock Exchange , Corporations - Finance , Financial risk management
- Language: English
- Type: Masters (Thesis)
- Identifier: http://hdl.handle.net/10210/245925 , uj:25483
- Description: M.Com. (Financial Management) , Abstract: Share prices and dividends were considered as important factors in creating and increasing shareholders’ wealth. In some theories it was indicated that the existence of a relationship between share prices and dividends could be questioned. More important for companies and investors was the determination of a relationship between share price volatility and dividends. If such a relationship existed, companies could structure their dividend policy decisions to attain minimum share price volatility in order to attract maximum investor interest. This was especially important to small and medium-sized companies finding themselves in the early growth phase. The aim of this study was to determine whether a relationship existed between share price volatility and dividend policy for companies listed on the Alternative Exchange (AltX) on the Johannesburg Stock Exchange Limited (JSE Ltd). Dividend policy was measured through dividend yield and the dividend pay-out ratio. Share price volatility was regressed against dividend yield and the dividend pay-out ratio using panel data regression analysis to achieve this aim. Share price volatility was found to have a statistically significant and negative relationship with dividend yield, and a statistically insignificant relationship with the dividend pay-out ratio. The results indicated that a company could possibly reduce the share price volatility by using the dividend policy by declaring dividends, although the amount of dividends in relation to earnings were of little importance to investors of small to medium-sized companies. The results of this study therefore provided information that such companies could use to structure their dividend policy in such a way that share price volatility risk would be minimised, which in turn would promote optimum growth for investors.
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Die integrering van die finansiële bestuursfunksie in 'n groot maatskappy
- Authors: Van der Merwe, S.R.
- Date: 2015-09-28
- Subjects: Corporations - Finance , Corporate governance
- Type: Thesis
- Identifier: uj:14205 , http://hdl.handle.net/10210/14651
- Description: M.Com. , Please refer to full text to view abstract
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- Authors: Van der Merwe, S.R.
- Date: 2015-09-28
- Subjects: Corporations - Finance , Corporate governance
- Type: Thesis
- Identifier: uj:14205 , http://hdl.handle.net/10210/14651
- Description: M.Com. , Please refer to full text to view abstract
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The optimum leverage for listed companies on the Johannesburg Securities Exchange
- Authors: Snaith, N.J.G.
- Date: 2014-10-08
- Subjects: Stock exchanges - South Africa , Corporations - Finance , JSE Limited , JSE Securities Exchange South Africa
- Type: Thesis
- Identifier: uj:12548 , http://hdl.handle.net/10210/12340
- Description: M.Com. (Business Management) , The capital structure of a company depends on the degree of debt used. Companies use debt to trade of tax shields and financial distress costs. At the margin where these equate, the optimal capital structure is reached. This optimal capital structure has been determined for each size of market capitalisation on the Johannesburg Securities Exchange. The capital structure theories of the static trade-off theory, pecking order and signalling model theory are highlighted in relation to company determinants such as size, asset structure, profitability and growth opportunities. A sample of 35 companies was used for each market capitalization for the period 2003 to 2009. The researcher uses a bar graph to display the average price to book value (P/BV) in sequential intervals for each degree of leverage in order to determine the optimal capital structure. The research shows that the optimum leverage for small market capitalisations was reached with a DIE ratio of 0.75-1 and for medium and large market capitalisations between 1.01-1.25.
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- Authors: Snaith, N.J.G.
- Date: 2014-10-08
- Subjects: Stock exchanges - South Africa , Corporations - Finance , JSE Limited , JSE Securities Exchange South Africa
- Type: Thesis
- Identifier: uj:12548 , http://hdl.handle.net/10210/12340
- Description: M.Com. (Business Management) , The capital structure of a company depends on the degree of debt used. Companies use debt to trade of tax shields and financial distress costs. At the margin where these equate, the optimal capital structure is reached. This optimal capital structure has been determined for each size of market capitalisation on the Johannesburg Securities Exchange. The capital structure theories of the static trade-off theory, pecking order and signalling model theory are highlighted in relation to company determinants such as size, asset structure, profitability and growth opportunities. A sample of 35 companies was used for each market capitalization for the period 2003 to 2009. The researcher uses a bar graph to display the average price to book value (P/BV) in sequential intervals for each degree of leverage in order to determine the optimal capital structure. The research shows that the optimum leverage for small market capitalisations was reached with a DIE ratio of 0.75-1 and for medium and large market capitalisations between 1.01-1.25.
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Corporate sustainability reporting and practice of listed companies
- Authors: Powell, Jonathan Anthony
- Date: 2014-06-21
- Subjects: Sustainable development reporting , Social responsibility of business - Economic aspects , Corporation reports , Corporations - Finance , JSE Securities Exchange South Africa
- Type: Thesis
- Identifier: uj:11570 , http://hdl.handle.net/10210/11277
- Description: M.Com. (Business Management) , South African companies now realise that they have a responsibility to ensure that the natural resources as well as the people living within the communities in which they operate must be preserved and nurtured to ensure that future generations enjoy their benefits as much as the current generation does today. Companies are under ever-increasing pressure from both internal and external stakeholders to consider the environmental and social impacts of their operations and to mitigate these impacts. To this end, sustainable development (SD) has gained significant importance and the reporting of sustainability performance is the means by which companies communicate their efforts to their stakeholders. This study analyses the relationship between sustainability performance and financial performance to ascertain whether the ‘business case’ for sustainability exists in South African listed companies. There has been a substantial amount of research on the topic of SD and its implications for companies; the focus for this study however is on whether sustainability initiatives are important indicators of financial performance. Research conducted by Montabon, Sroufe and Narashiman (2007:998), assessed the relationship between corporate reporting, environmental management practices and company performance, however the unit of analysis was North American, British and Australian companies. This study will replicate the study of Montabon et al, with a focus on South African Johannesburg Stock Exchange (JSE) listed companies. In addition, comparisons will be drawn between developed world companies and companies within an emerging market. Pertinent literature on the topic has been reviewed and the results will be compared to the work of Artriach, Lee, Nelson, and Walker, J. (2010); Reed (2001) as well as Porter and van der Linde (1995). The results of the study reveal that an overall positive relationship exists between sustainability performance and financial performance thus, the research supports the notion that efforts to preserve and nurture environmental and human resources lead to improved financial performance.
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- Authors: Powell, Jonathan Anthony
- Date: 2014-06-21
- Subjects: Sustainable development reporting , Social responsibility of business - Economic aspects , Corporation reports , Corporations - Finance , JSE Securities Exchange South Africa
- Type: Thesis
- Identifier: uj:11570 , http://hdl.handle.net/10210/11277
- Description: M.Com. (Business Management) , South African companies now realise that they have a responsibility to ensure that the natural resources as well as the people living within the communities in which they operate must be preserved and nurtured to ensure that future generations enjoy their benefits as much as the current generation does today. Companies are under ever-increasing pressure from both internal and external stakeholders to consider the environmental and social impacts of their operations and to mitigate these impacts. To this end, sustainable development (SD) has gained significant importance and the reporting of sustainability performance is the means by which companies communicate their efforts to their stakeholders. This study analyses the relationship between sustainability performance and financial performance to ascertain whether the ‘business case’ for sustainability exists in South African listed companies. There has been a substantial amount of research on the topic of SD and its implications for companies; the focus for this study however is on whether sustainability initiatives are important indicators of financial performance. Research conducted by Montabon, Sroufe and Narashiman (2007:998), assessed the relationship between corporate reporting, environmental management practices and company performance, however the unit of analysis was North American, British and Australian companies. This study will replicate the study of Montabon et al, with a focus on South African Johannesburg Stock Exchange (JSE) listed companies. In addition, comparisons will be drawn between developed world companies and companies within an emerging market. Pertinent literature on the topic has been reviewed and the results will be compared to the work of Artriach, Lee, Nelson, and Walker, J. (2010); Reed (2001) as well as Porter and van der Linde (1995). The results of the study reveal that an overall positive relationship exists between sustainability performance and financial performance thus, the research supports the notion that efforts to preserve and nurture environmental and human resources lead to improved financial performance.
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Shareholder loans in corporate finance law
- Authors: Khoza, Lerato
- Date: 2014-06-04
- Subjects: United Nations Commission on International Trade Law , Corporations - Finance , Loans - Law and legislation , Stockholders
- Type: Thesis
- Identifier: uj:11381 , http://hdl.handle.net/10210/11019
- Description: LL.M. (Corporate Law) , Jurisdictions employ several legal methods to regulate loans made by shareholders to companies. This dissertation explores the legal mechanisms employed by Germany, the United States, the United Kingdom as well as Australia that align to the recommendations of the United Nations Commission on International Trade Law (UNCITRAL) in respect of shareholder loans and seeks to answer the question whether South Africa should adopt similar mechanisms. German law complies fully with the UNCITRAL recommendations by providing for the automatic subordination of shareholder claims in respect of loans as well as the avoidance of repayments and security interests made and registered within a certain period of the commencement of insolvency proceedings. German law also contains avoidance provisions specific to transactions between the debtor and a shareholder that cause detriment to a third-party creditor and general avoidance provisions which provide for certain presumptions to apply in the case of transactions concluded between the company and a shareholder. In the United States the doctrine of equitable subordination is legislated and applies in the event that the debtor is thinly-capitalised and mismanaged and legislative provision is made for the avoidance of preference transactions concluded between a creditor and a debtor, which provide for a longer avoidance period in the case of a transaction concluded with a shareholder. In addition to full legislative compliance with the UNCITRAL recommendation relating to shareholder transactions, the wide powers given to the courts to uphold bankruptcy legislation is codified and led to the development of the doctrine of recharacterization, which entails shareholder loans being treated as equity contributions in certain circumstances. The United Kingdom does not contain legal provisions relating to the subordination of shareholder claims and thus does not comply fully with the UNCITRAL recommendations relating to shareholder loans. However, it does provide specifically for a longer avoidance period in respect of preference transactions involving shareholders and certain presumptions to be applied in the case of transactions concluded between the debtor company and a shareholder.
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- Authors: Khoza, Lerato
- Date: 2014-06-04
- Subjects: United Nations Commission on International Trade Law , Corporations - Finance , Loans - Law and legislation , Stockholders
- Type: Thesis
- Identifier: uj:11381 , http://hdl.handle.net/10210/11019
- Description: LL.M. (Corporate Law) , Jurisdictions employ several legal methods to regulate loans made by shareholders to companies. This dissertation explores the legal mechanisms employed by Germany, the United States, the United Kingdom as well as Australia that align to the recommendations of the United Nations Commission on International Trade Law (UNCITRAL) in respect of shareholder loans and seeks to answer the question whether South Africa should adopt similar mechanisms. German law complies fully with the UNCITRAL recommendations by providing for the automatic subordination of shareholder claims in respect of loans as well as the avoidance of repayments and security interests made and registered within a certain period of the commencement of insolvency proceedings. German law also contains avoidance provisions specific to transactions between the debtor and a shareholder that cause detriment to a third-party creditor and general avoidance provisions which provide for certain presumptions to apply in the case of transactions concluded between the company and a shareholder. In the United States the doctrine of equitable subordination is legislated and applies in the event that the debtor is thinly-capitalised and mismanaged and legislative provision is made for the avoidance of preference transactions concluded between a creditor and a debtor, which provide for a longer avoidance period in the case of a transaction concluded with a shareholder. In addition to full legislative compliance with the UNCITRAL recommendation relating to shareholder transactions, the wide powers given to the courts to uphold bankruptcy legislation is codified and led to the development of the doctrine of recharacterization, which entails shareholder loans being treated as equity contributions in certain circumstances. The United Kingdom does not contain legal provisions relating to the subordination of shareholder claims and thus does not comply fully with the UNCITRAL recommendations relating to shareholder loans. However, it does provide specifically for a longer avoidance period in respect of preference transactions involving shareholders and certain presumptions to be applied in the case of transactions concluded between the debtor company and a shareholder.
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Relative importance of company financial statements in investment analysis
- Authors: Bruinette, Albert J.M.
- Date: 2014-02-10
- Subjects: Business enterprises - Valuation , Financial statements , Corporations - Finance
- Type: Thesis
- Identifier: uj:3725 , http://hdl.handle.net/10210/9105
- Description: M.Comm. , Please refer to full text to view abstract
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- Authors: Bruinette, Albert J.M.
- Date: 2014-02-10
- Subjects: Business enterprises - Valuation , Financial statements , Corporations - Finance
- Type: Thesis
- Identifier: uj:3725 , http://hdl.handle.net/10210/9105
- Description: M.Comm. , Please refer to full text to view abstract
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