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Capital structure in the world airline industry [An article from: Transportation Research Part A]
Book Details
Author(s)H.M.P. Capobianco, E. Fernandes
PublisherElsevier
ISBN / ASINB000RQZWUA
ISBN-13978B000RQZWU2
AvailabilityAvailable for download now
Sales Rank11,200,866
MarketplaceUnited States 🇺🇸
Description
This digital document is a journal article from Transportation Research Part A, published by Elsevier in 2004. The article is delivered in HTML format and is available in your Amazon.com Media Library immediately after purchase. You can view it with any web browser.
Description:
This article presents a managerial approach to the airline capital structure through a definition of an efficient frontier. To develop the analysis a technique called data envelopment analysis was used. This paper tests the hypothesis that airline industry's financial performance depends on companies keeping a reasonable level of leverage and also seeks to establish this level. The research identifies the biggest airline companies which use capital efficiently to generate return with a low level of fixed assets. In these companies, shareholders' capital represents at least 40% of all funds employed. It could be seen by simplifying the analysis that it is possible to identify the most and the least efficient companies by studying their indebtedness and return on assets. A large proportion of the companies are moving to reduce their level of indebtedness and raise their returns over the course of time. The analysis by country revealed that countries do not offer comparative advantages, with the companies' performance depending fundamentally on their management.
Description:
This article presents a managerial approach to the airline capital structure through a definition of an efficient frontier. To develop the analysis a technique called data envelopment analysis was used. This paper tests the hypothesis that airline industry's financial performance depends on companies keeping a reasonable level of leverage and also seeks to establish this level. The research identifies the biggest airline companies which use capital efficiently to generate return with a low level of fixed assets. In these companies, shareholders' capital represents at least 40% of all funds employed. It could be seen by simplifying the analysis that it is possible to identify the most and the least efficient companies by studying their indebtedness and return on assets. A large proportion of the companies are moving to reduce their level of indebtedness and raise their returns over the course of time. The analysis by country revealed that countries do not offer comparative advantages, with the companies' performance depending fundamentally on their management.
