| Abstract [eng] |
The choices of the company's capital structure are made to ensure the smooth company's activity. To remain competitive, CEO must respond precisely, quickly, and properly to changes in the environment around them. The capital structure, due to its various characteristics, unequal power of decisions in the company, has a different impact on the investments, their efficiency and financing. Capital structure is a key factor influencing investment decisions. Investment decisions affect the company's value. Purposefully selected financing combinations help to maintain the company's stability, balance the risk, and most importantly help to achieve economic benefits and profitability. The final master's thesis presents the theoretical aspects of the influence of the capital structure on the company's capital costs and its investment decisions, presents the methods used in the research, evaluates the financial data of the four largest listed dairy companies in Lithuania to analyse the influence of the capital structure on the capital costs and investment decisions. The literature describes studies that analyse the impact of equity structure on investment decisions, but these studies have been conducted in large markets, choosing a single direction for evaluating investment decisions and rarely taking capital structure into account. The analysis showed that when companies finance their activities with loaned capital, the profitability indicators of companies are at an insufficient level. After evaluating the companies regardless of the share of loaned capital, it turned out that the profitability indicators in the analysed period are below the average of the Lithuanian entire dairy industry. The result of the correlation analysis shows that increasing the debt can worsen the profitability indicators. During the research, there is an inverse relationship between capital structure and overall profitability in Lithuanian dairy companies, as the debt-to-equity ratio increases, the company's profitability decreases. Due to this dependence, companies should not increase the share of loaned capital in which the profitability indicators are lower, because strategic investors will not want to take unwanted risks and may reduce them even more. Companies with 10-30 percent of loaned capital have appropriate profitability indicators. Since the results are not unambiguous, dairy companies need to use different operational strategies, some should pay attention to costs and cost, others focus more on operations, administrative cost reduction or operational improvement. |
