Analysis of the Company’s Performance Based on Method of Economic Value Added

DOI

10.2991/icracos-19.2020.38How to use a DOI?

Keywords

Net Operating Profit After Tax, Invested Capital, Weighted Average Cost Of Capital, Capital Charge, Economic Value Added

Abstract

Economic value added is financial performance analysis tool of company that used for measure the value added per valuation period and also used by investor as a guidance and based to make an investment in the company. The purpose of this study was to know the financial performance in the fishery sub sector company that registered in Indonesia Stock Exchange at the period 2014 to 2016. And also to compare the financial performance in the fishery sub sector company. The research method used is quantitative study of economic value added method with the following steps; calculate Net Operating Profit After Tax, calculate Invested Capital, calculate Weighted Average Cost of Capital, calculate Capital Charges and calculate Economic Value Added,and taking conclusion based on EVA measurement. From 3 (three) fishery sub sector companies that registered in Indonesia Stock Exchange, there are 2 (two) companies namely PT. Central Proteina Prima Tbk and PT. Inti Agri Resources Tbk that experience negative value or EVA < 0, that means on the firms there is no value added. At the same time, 1 (one) company namely PT. Dharma Samudera Fishing Industries Tbk experience positive value or EVA > 0, means on the firm there is value added. To increase EVA value in companies in the fisheries sub sector, it is better for companies to increase operating profit, ie company management is expected to be able to manage capital costs and debt costs effectively and efficiently in the company's operations to obtain high Net operating profit after tax values. For fisheries sub-sector companies that have EVA> 0, or positive EVA, continue to maintain or improve the company's performance and management in managing the company's economic operations to be able to produce returns or profits that exceed capital costs

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Anita Nisa Kambey
AU  - Novalita Silinaung
PY  - 2020/01
DA  - 2020/01
TI  - Analysis of the Company’s Performance Based on Method of Economic Value Added
BT  - Proceedings of the International Conference on Research and Academic Community Services (ICRACOS 2019)
PB  - Atlantis Press
SP  - 177
EP  - 181
SN  - 2352-5398
UR  - https://doi.org/10.2991/icracos-19.2020.38
DO  - 10.2991/icracos-19.2020.38
ID  - Kambey2020/01
ER  -