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Determinants of Capital Structure: The Evidence from European Energy Companies

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  • Ayberk Nuri Berkman
  • Omer Iskenderoglu
  • Erdinc Karadeniz
  • Nazif Ayyildiz

Abstract

The main aims of this study are to determine the factors which affect capital structure of corporations operating in energy sector and to detect capital structure theories with which capital structure of energy sector companies would comply. In this context, a panel data analysis was performed on totally 79 European energy companies operated between the years 2009 - 2012. According to results of the study; diminishing leverage rate caused by increased liquidity in European energy companies can be explained with the Pecking Order Theory, while escalating leverage rate caused by increased tangible fixed assets or equity turnover would be defined with the Trade-off Theory.

Suggested Citation

  • Ayberk Nuri Berkman & Omer Iskenderoglu & Erdinc Karadeniz & Nazif Ayyildiz, 2016. "Determinants of Capital Structure: The Evidence from European Energy Companies," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 7(6), pages 96-106, November.
    • Handle: RePEc:jfr:ijba11:v:7:y:2016:i:6:p:96-106
    DOI: 10.5430/ijba.v7n6p96
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    Cited by:

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    2. Georgeta Vintilă & Ştefan Cristian Gherghina & Diana Alexandra Toader, 2019. "Exploring the Determinants of Financial Structure in the Technology Industry: Panel Data Evidence from the New York Stock Exchange Listed Companies," JRFM, MDPI, vol. 12(4), pages 1-16, October.
    3. Mahboubeh Bahreini & Cahit Adaoglu, 2018. "Dividend payouts of travel and leisure companies in Western Europe," Tourism Economics, , vol. 24(7), pages 801-820, November.
    4. Arindam Banerjee & Anupam De, 2014. "Determinants of Corporate Financial Performance Relating to Capital Structure Decisions in Indian Iron and Steel Industry," Paradigm, , vol. 18(1), pages 35-50, June.
    5. James Agyei & Shaorong Sun & Eugene Abrokwah, 2020. "Trade-Off Theory Versus Pecking Order Theory: Ghanaian Evidence," SAGE Open, , vol. 10(3), pages 21582440209, July.
    6. Andreas Kaloudis & Dimitrios Tsolis, 2019. "Capital Structure and Speed of Adjustment in U.S. Firms. Α Comparative Study in Microeconomic and Macroeconomic Conditions-A Quantile Regression Approach," International Business Research, Canadian Center of Science and Education, vol. 12(10), pages 98-109, October.
    7. Mazlina Mustapha Author_Email: mazlina05@gmail.com & Hashanah Bt Ismail & Badriyah Bt Minai, 2011. "Determinants Of Debt Structure: Empirical Evidence From Malaysia," 2nd International Conference on Business and Economic Research (2nd ICBER 2011) Proceeding 2011-490, Conference Master Resources.
    8. Jacek Jaworski & Leszek Czerwonka, 2021. "Determinants of Enterprises’ Capital Structure in Energy Industry: Evidence from European Union," Energies, MDPI, vol. 14(7), pages 1-21, March.
    9. Aamer Shahzad & Muhammad Azeem & Mian Sajid Nazir & Xuan Vinh Vo & Nguyen T. M. Linh, 2021. "The determinants of capital structure: Evidence from SAARC countries," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 6471-6487, October.
    10. Alessandra Amendola & Marinella Boccia & Gianluca Mele & Luca Sensini, 2020. "Tax Policy and Firms' Financial Choices: Empirical Evidence from the Dominican Republic," MIC 2020: The 20th Management International Conference,, University of Primorska Press.
    11. Paulo Maçãs Nunes & Zélia Serrasqueiro, 2017. "Short-term debt and long-term debt determinants in small and medium-sized hospitality firms," Tourism Economics, , vol. 23(3), pages 543-560, May.
    12. Powel Maxwell Worimegbe & Agbaje Ifedayo, 2020. "Corporate Rebranding And Customers Retention. A Study Of Selected Telecommunication Firm In Nigeria," Cactus - The tourism journal for research, education, culture and soul, Bucharest University of Economic Studies, vol. 2(1), pages 17-25.
    13. Rajesh Desai & Jay Desai, 2020. "Moderating Effect Of Firm Size On Capital Structure Determinants: Evidence From Indian Food Processing Industry," Copernican Journal of Finance & Accounting, Uniwersytet Mikolaja Kopernika, vol. 9(3), pages 61-81.
    14. Barbara Grabinska & Marcin Kedzior & Dorota Kedzior & Konrad Grabinski, 2021. "The Impact of Corporate Governance on the Capital Structure of Companies from the Energy Industry. The Case of Poland," Energies, MDPI, vol. 14(21), pages 1-25, November.
    15. Bojana Vukovic & Suncica Milutinovic & Nikola Milicevic & Dejan Jaksic, 2020. "The Analysis of Indebtedness of Retail Companies in the Balkan Countries," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 3, pages 83-104.
    16. Murat Kizildag & Ozgur Ozdemir, 2017. "Underlying factors of ups and downs in financial leverage overtime," Tourism Economics, , vol. 23(6), pages 1321-1342, September.
    17. Luís Pacheco & Fernando Tavares, 2017. "Capital structure determinants of hospitality sector SMEs," Tourism Economics, , vol. 23(1), pages 113-132, February.
    18. Jędrzejczak-Gas Janina, 2017. "Determinants of the capital structure of TSL sector enterprises," Management, Sciendo, vol. 22(1), pages 122-139, September.
    19. Abdullah, Hariem & Tursoy, Turgut, 2021. "Capital structure and firm performance: a panel causality test," MPRA Paper 105871, University Library of Munich, Germany.
    20. Erdinc Karadeniz & Serkan Yilmaz Kandir & Omer Iskenderoglu & Yildirim Beyazit Onal, 2011. "Firm Size and Capital Structure Decisions: Evidence From Turkish Lodging Companies," International Journal of Economics and Financial Issues, Econjournals, vol. 1(1), pages 1-11.
    21. Martin Falk & Robert Steiger, 2018. "An Exploration of the Debt Ratio of Ski Lift Operators," Sustainability, MDPI, vol. 10(9), pages 1-16, August.

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