Research On Correlation Between Capital Structure And Profitability Of Electric Power Listed Companies

Profitability is an important manifestation of the core competitiveness of listed companies,and the capital structure is a concentrated expression of the rights and obligations of the company's stakeholders.A reasonable capital structure can enhance the company's financing ability and improve the company's operating performance.On the contrary,the unreasonable capital structure will reduce the financing capacity and increase the company's operating risks.The electric power industry is the basic industry of the national economy.The rapid development of the national economy has led to an increasing demand for electricity,which has caused the financing needs of power listed companies.A reasonable capital structure is particularly important for power listed companies.This paper studies the correlation between capital structure and profitability of electric power listed companies in order to provide reference for financing decisions and capital structure optimization of power listed companies.Based on the life cycle perspective,this paper takes the financial data of electric power listed companies from 2013 to 2017 as a research sample.In this paper,the cash flow combination method is used to divide the research sample,and the whole sample is divided into three sub-samples of growth,maturity and decline.Moreover,this paper uses factor analysis and multiple-regression analysis to empirically study the correlation between the capital structure and profitability of the three subsamples.The results show that:(1)The electric power listed companies adopt significant capital structure in different life cycle stages.(2)As far as the debt structure is concerned,there is a significant positive correlation between the asset-liability ratio and the profitability in the growth period companies,while the long-term debt-to-equity ratio has a negative impact on profitability.For the mature period companies,there is a negative correlation and a significant ?U? type correlation between the asset-liability ratio and profitability.The correlation between the debt structure and profitability of the recession company is not significant.(3)As far as the shareholding structure is concerned,the correlation between the equity concentration and the equity balance and profitability is not significant in the growth period companies.However,equity concentration and profitability are positively related to a certain extent,and there is a certain negative correlation between equity balance and profitability.There is a significant positive correlation between the largest shareholder's holding rate and the profitability in the mature period companies.There is a significant positive correlation between the largest shareholder's holding rate and the profitability in the mature period companies.While the shareholding ratio of the top ten shareholders and the balance of equity has a certain positive correlation with and profitability,but it has not passed the significant test.There is no significant correlation between the shareholding structure and profitability of listed companies in the recession period.According to the empirical results,it can be seen that the electric power listed companies in different life stages have different correlations between capital structure and profitability.Therefore,the power listed companies should pay attention to their own life stage,adjust the capital structure in time to adapt to the company's development and improve profitability.At the same time,it is possible to appropriately increase the shareholding ratio of the largest shareholder to promote the sustainable development of the company.