The Study of Factors that may Influence the Performance by the Dupont Analysis in the Furniture Industry

• Published in: Procedia economics and finance 2014, Vol.16, p.213-223
• Main Authors: Burja, Vasile, Mărginean, Radu
• Format: Article
• Language: English
• Subjects: Pearson coefficient; Return On Assets(ROA); Return On Equity(ROE); Return on Sales(ROS); The DuPont model
• ISSN: 2212-5671; 2212-5671
• DOI: 10.1016/S2212-5671(14)00794-1

In the context of the study of economic and financial performance, a very useful tool in the specialized literature and practice is the DuPont model. The analysis by the DuPont model is realized through the decomposition rate of return ROE (Return on Equity) according to other rates of return, such as ROS (Return on Sales), ROA (Return on Assets) or Equity Multiplier. The main objective of this paper is to present factors that can influence the performance of the DuPont analysis in five large companies with activity in the furniture industry. In the case study we present the indicators and the calculation of ROE by the DuPont analysis on a time horizon of 13 years to observe the influences of indicators in the model on profitability. Applying the methodology of calculating the Pearson correlation coefficient, we studied the correlations of Turnover and ROE indicators with other indicators of the model and presented the main existing influences.