This thesis studies the impact of working capital management on profitability of CEVA Logistics.
Optimizing working capital management has never been an easy job for every company, because
of the close relationship to liquidity and profitability who are inversely related to each other.
Working capital concerns about meeting the short-term obligations of the company, thus it helps
the company in managing its liquidity. However, because of the trade-off between liquidity and
profitability, working capital management might give opposing impact to the profitability of the
company. Therefore, it is interesting to see how the current working capital management of CEVA
Logistics impacts its profitability.
The central research question of this study is "How does the current working capital management
of CEVA Logistics affect its profitability and what causes it?". In answering the question,
correlation analysis and regression analysis are conducted on the two variables. Cash conversion
cycle (CCC) is used as the proxy of working capital management and EBITDA return on assets
(EBITDA ROA) and EBITDA margin are used as the proxies of profitability. The correlation
analysis and regression analysis use confidence interval of 95%.
The result of this study shows that the current working capital management of CEVA Logistics
impacts negatively towards its profitability, proven by negative relationships that CCC and
EBITDA ROA and CCC and EBITDA margin have from the results of regression analyses
conducted. The study also gives further insight about which variable in CCC (DSO, DIO, and
DPO) that impacts the profitability of CEVA Logistics the most. After conducting the regression
analyses, it is found that DSO gives the most impact followed by DPO, while DIG is not significant
in explaining the variance in profitability. Then, recommendations are given to further improve
the working capital management and increase the profitability of the company.

Creator(s)

• (34412016) EVANGELINE JOSEPHINE MULJONO

Contributor(s)

• RENE VAN DER LINDEN → Advisor 1
• DAVID WILSON → Examination Committee 1

Publisher

Universitas Kristen Petra; 2016

Language

English

Category

s1 – Undergraduate Thesis

Sub Category

Skripsi/Undergraduate Thesis

Source

Undergraduate Thesis No. 34010270IMAN/2016; Evangeline Josephine Muljono (34412016)

Subject(s)

• WORKING CAPITAL-MANAGEMENT
• WORKING CAPITAL-CASE STUDIES

File(s)

• jiunkpe-is-s1-2016-34412016-35943-capital-cover.pdf
• jiunkpe-is-s1-2016-34412016-35943-capital-abstract_toc.pdf