Tourism Firms' Capital Structure And Corporate Performance Research

The relationship between the capital structure and the operational performance of the listed tourism companies in china is worthy of study for its great theoretical and practical value. With the development of the tourism industry in our country and the improvement of the modern corporate system established in listed tourism companies, it is very necessary to discuss how improving capital structure influences firm performance.From the empirical angle the thesis probes initially into the relationship between the capital structure and the performance of the listed tourism companies in our country. Based on the relevant theories and research documents, the thesis brings forward to three hypotheses: First, the relationship between the capital structure and the performance of our listed tourism companies appears the quadratic curve relation. Second, there is a suitable region of our listed tourism companies' capital structure. Third, before the assets-debt ratio of the listed tourism company attains the theoretical best point, the elasticity of the performance to the capital structure is smaller than one. And then the thesis chooses 17 listed tourism companies in our country as the sample companies. According to their annual financial report, liability-asset ratio is used to describe the capital structure and ROE is used to describe the performance of sample companies. With these indexes, the thesis testifies whether the capital structure is related to the performance of sample companies during 2004 to 2006 through the statistics and a regression analysis of the data. A negative correlation is found between the capital structure and the performance of sample companies and the capital structure of listed tourism companies has not the best range only with the sectional data from 2004 to 2006. Finally, the thesis raises some suggestions upon the capital structure optimization for the listed tourism companies in our country.