The impact of factors to profitability of some coal mining enterprises after vinacomin restructure project

Abstract

The article uses Dupont analysis to determine the factors affecting profitability (ROE) of Vietnam coal mining enterprises and the regression method to examine the impact of production capacity of short-term assets, production capacity of long-term assets, production capacity of costs and capital structure on the profitability of firms. The article uses financial data collected from 19 coal mining companies of Vietnam National Coal-Mineral Industries Holding Corporation during the period of 2015 - 2018. The results show that production capacity of short-term assets, production capacity of long-term assets, production capacity of costs and capital structure positively impact profitability. The paper suggests 2 ways to improve profitability: firstly, borrowing to invest in technology will help coal mining enterprises improve their profitability; secondly, improving production processes appropriately to take full advantage of existing equipment capacity, thereby increasing profitability.