FINANCIAL DISTRESS AND FINANCIAL PERFORMANCE ANALYSIS OF HIGHWAY COMPANIES BEFORE AND DURING THE COVID19 PANDEMIC: EVIDENCE FROM INDONESIA STOCK EXCHANGE

Ari Prasetyo, Taufik Faturohma

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

Abstract

Starting in March 2020, Indonesia had the COVID-19 pandemic. Furthermore, this situation has decreased the utilization of highways due to complying with the government regulation, including work from home and large-scale social restrictions to reduce the spreading the corona virus. There are three highway companies listed on Indonesia Stock Exchange such as CMNP, META, and JSMR. On the other hand, the research about the financial performance and the financial distress prediction in Highways sector, especially in Indonesia is not available during the COVID-19 pandemic. This research is aimed to evaluate the financial distress by the Zmijewski model with two criterions: bankrupt and non-bankrupt zone and the financial performance by state-owned enterprise (SOE) rating with three criterions: healthy, less healthy, and unhealthy condition. The period of research is Q1 2019 – Q1 2020 as the period before the COVID-19 pandemic and Q2 2020 – Q2 2021 as the period during the COVID-19 pandemic. The study concludes that all highway companies was in non-bankrupt zone by the Zmijewski model for both before and during the COVID-19 pandemic. In addition, based on SOE rating on average for the period before the COVID-19 pandemic, CMNP, META, and JSMR achieved rating consecutively BBB, BBB, and BB. Meanwhile, on average, for the period during the COVID-19 pandemic, CMNP, META, and JSMR achieved ratings consecutively BB, BB, and B.

Original languageEnglish
Title of host publicationInternational Symposia in Economic Theory and Econometrics
PublisherEmerald Publishing
Pages151-165
Number of pages15
DOIs
Publication statusPublished - 10 Apr 2023

Publication series

NameInternational Symposia in Economic Theory and Econometrics
Volume31
ISSN (Print)1571-0386

Keywords

  • COVID-19 pandemic
  • Financial distress
  • Zmijewski modeSOE rating
  • financial performance
  • highway company

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