Companies profitability under economic instability: evidence from the manufacturing industry in Russia

Spitsin, Vladislav; Ryzhkova, Marina; Vukovic, Darko; Anokhin, Sergey

doi:10.1186/s40008-020-0184-9

Journal of Economic Structures

The Official Journal of the Pan-Pacific Association of Input-Output Studies (PAPAIOS)

Table 4 Net profitability of assets.

From: Companies profitability under economic instability: evidence from the manufacturing industry in Russia

Variable	DM	DK	DG	DJ	DL	DA
Size of the enterprise	6.94 (1.22)^b	8.14 (0.61)^b	7.20 (0.94)^b	6.35 (0.59)^b	7.44 (0.97)^b	5.69 (0.47)^b
Fixed assets share	− 0.56 (0.65)	− 1.31 (0.37)^b	− 0.90 (0.39)	− 1.54 (0.32)^b	− 2.12 (0.50)^b	− 1.10 (0.22)^b
Current liquidity ratio	3.56 (3.63)	− 0.12 (1.46)	− 0.09 (0.09)	− 1.62 (0.70)	− 0.22 (0.11)	0.16 (0.20)
Gross profitability of sales	6.65 (1.10)^b	5.70 (0.39)^b	4.70 (0.53)^b	5.12 (0.55)^b	4.74 (0.51)^b	4.91 (0.37)^b
Share of borrowed capital	− 4.59 (1.06)^b	− 5.95 (0.55)^b	− 5.84 (0.58)^b	− 5.59 (0.48)^b	− 6.20 (0.56)^b	− 6.76 (0.42)^b
Average interest rates	− 1.36 (0.21)^b	− 0.58 (0.10)^b	− 0.32 (0.13)	− 0.77 (0.11)^b	− 0.48 (0.12)^b	− 0.44 (0.08)^b
Average annual exchange rate	0.71 (0.23)^a	− 0.04 (0.11)	0.26 (0.15)	0.08 (0.12)	− 0.23 (0.13)	− 0.12 (0.09)
Gross profitability of sales * ShareFO	− 1.22 (0.26)^b	− 0.39 (0.14)^a	− 0.46 (0.16)^a	− 0.61 (0.14)^b	− 0.43 (0.17)	− 0.49 (0.10)^b
Share of borrowed capital * ShareFO	0.05 (0.60)	− 1.64 (0.44)^b	− 2.09 (0.71)^a	− 0.65 (0.46)	0.84 (0.44)	− 0.61 (0.38)
Share of borrowed capital * ShareFO * Ruble’s depreciation	− 1.47 (0.22)^b	− 0..80 (0.23)^b	− 0.94 (0.18)^b	− 0.85 (0.15)^b	− 1.14 (0.26)^b	− 0.43 (0.17)
Average interest rates * ShareFO	2.61 (0.85)^a	− 0.01 (0.48)	− 0.63 (0.66)	− 0.42 (0.46)	1.84 (0.49)^b	− 0.42 (0.34)
Average annual exchange rate * ShareFO	1.00 (0.25)^b	0.58(0.15)^b	0.49 (0.16)^a	0.38 (0.15)	0.30 (0.19)	0.08 (0.12)
Intercept	4.39 (0.64)^b	7.49 (0.21)^b	5.01 (0.35)^b	6.93 (0.20)^b	6.17 (0.22)^b	5.41 (0.10)^b
Model 1 R²	0.097	0.120	0.062	0.080	0.084	0.040
Model 2 R²	0.277	0.238	0.146	0.198	0.158	0.111
Model 3 R²	0.330	0.327	0.248	0.284	0.2.44	0.234
Model 4 R²	0.369	0.332	0.252	0.292	0.251	0.238
Model 5 R²	0.403	0.334	0.256	0.297	0.253	0.243
Model 6 R²	0.468	0.354	0.292	0.313	0.281	0.247
Model 7 R²	0.508	0.358	0.298	0.315	0.288	0.247
∆R² of production efficiency^a	0.214	0.12	0.088	0.123	0.076	0.076
∆R² of financial factors^b	0.197	0.118	0.148	0.112	0.128	0.131
Including—internal	0.118	0.109	0.138	0.102	0.114	0.127
External	0.079	0.009	0.01	0.01	0.014	0.004
Number of enterprises
Total	303	1070	728	1113	869	2051
FO	56	78	87	73	52	124
JO	25	51	44	58	43	73
RO	222	941	597	982	774	1854

Regression results (fixed effects estimates, robust estimates)
Standard errors are in parentheses. The coefficients and standard errors are given according to model 7. All constructed models (models no. 1–7) for each type of economic activities are highly significant (p ≪ 0.0001)
^a∆R² of production efficiency = R² (model 2) − R² (model 1) + R² (model 5) − R² (model 4). Or it is equal to the sum of ∆R² (model 2) and ∆R² (model 5)
^b∆R² of internal financial factors = R² (model 3) − R² (model 2) + R² (model 6) − R² (model 5). Or it is equal to the sum of ∆R² (model 3) and ∆R² (model 6). R² of external financial factors = R² (model 4) − R² (model 3) + R² (model 7) − R² (model 6). Or it is equal to the sum of ∆R² (model 4) and ∆R² (model 7)

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