MODERATION ON FIRM SIZE TOWARD FACTORS AFFECTING PROFIT GROWTH STUDY ON CONSUMER GOODS COMPANIES LISTED IN IDX 2016-2020

Abstract

This study aims to determine the effects of free cash flow, net profit margin, current ratio, and debt to equity ratio on profit growth of consumer goods companies listed in Indonesia Stock Exchange 2016-2020. Consumer goods industry companies are one of the sectors that play a role in the capital market. As we know, this consumer goods industrial company is a company that produces goods or products of the general public's daily life. Such as, food, beverages, pharmaceuticals, household appliances, cigarettes, and so on. Yolanda & Hendrayani (2019) said that the consumer goods industry sector is a sector that plays an important role in encouraging economic growth in Indonesia. This research applying the firm size as moderating variable. The sample is selected using the technique purposive sampling on 27 chosen companies and secondary sources was used in order to complete this study. The research used a descriptive analysis method as well as utilising SmartPLS software in order to evaluate various data analysis methods. Research showed that net profit margin and current ratio have a significant effect on profit growth. However, the debt to equity ratio does not possess any fundamental influence on profit growth. The size of companies could only moderate the significance between net profit margin with profit growth, but not capable to moderate the significance between the current ratio and debt to equity ratio with profit growth.

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