Český finanční a účetní časopis 2017(4):25-39 | DOI: 10.18267/j.cfuc.503

Capital Structure of Czech joint stock companies

Lucie Poulová
Vysoká škola ekonomická v Praze, Fakulta financí a účetnictví, katedra financí a oceňování podniku, nám. W. Churchilla 4, 130 67 Praha 3.

This article is aimed at the analysis of capital structure of joint stock companies based in the Czech Republic operating in agriculture, industry and building, using the basic principles and ratios of financial analysis. The levels of debt ratio are judged not only according to industry classification but also according to the type of ownership. In the next step, the relationship between leverage and profitability is closely explored since it is thought to be one of the main determinants. Lastly, the liquidity is analysed as a characteristic of short term financial management. The results show that the level of leverage does not change significantly during the followed period. Considering the resources of financing, the share capital plays dominant role being supplemented by retained earnings, apart from payables bank financing is also very important liability. As far as the capital structure theories are concerned, arguments for validity of both are founded.

Keywords: Capital structure; Joiunt stock companies; Debt ratio; Fixed assets coverage; Return on assets; Liquidity.
JEL classification: G32

Published: March 1, 2018  Show citation

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Poulová, L. (2017). Capital Structure of Czech joint stock companies. Czech Financial and Accounting Journal, 2017(4), 25-39. doi: 10.18267/j.cfuc.503
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