The impact of capital structure on firm's performance: Evidence from Malaysia plantation sector

This study aims to examine the impact of capital structure on firm performance in Malaysia, focusing specifically on the plantation sector. The investigation utilizes a panel data procedure on a sample of 10 Malaysian listed plantation firms on the Bursa Malaysia Stock Exchange spanning the period 2015-2019. Firm performance is assessed using three dependent variables: Return on Equity (ROE), Return on Assets (ROA), and Earnings per Share (EPS). The capital structure is measured using three independent variables: Debt to Equity Ratio, Total Debt Ratio, and Total Equity Ratio. Data analysis methods employed include descriptive statistics and multiple regression. The study finds that the three dependent variables (ROE, ROA, and EPS) demonstrate a relationship with the independent variables that may be period-related. The research ultimately advises firms to attach importance to capital structure, alongside human capital development and efficient asset management, for improving overall performance.