| About corporate capital structure study from the 1950s MM theory, is always the financial field of study of hottest topics, which has also developed a series of classical theory, such as trade-off theory, agency theory, signal transmission theory, pecking order financing theory etc. Scholars'studies find that it exist some relationship between financing structure and corporate performance. Foreign classical theories suggest that debt financing have the effect that cannot ignore on improving corporate governance, and improving corporate performance. At present our country capital markets mature enough, whether the relevant foreign financing structure of classical theory in our capital market is feasible, domestic there has still not been a consensus. With China's capital market development, more and more scholars agree this viewpoint: the reasonable financing structure can help improving corporate governance, raising company's performance. Corporate financing has two kinds:internal financing and external financing. Among them, the external financing includes equity financing and debt financing. Based on previous data statistics, the financing way of China's listed companies is mainly direct financing, especially prefers equity financing. It exist obvious conflict with the pecking order financing theory and financing order in western developed countries. Why appears this kind of circumstance? How does the relationship between China's listed companies'debt financing and corporate performance exist? This is a worthy academic research problem. Therefore, the research of the relationship between debt financing and corporate performance has important theoretical significance and practical significance.Electric power industry is the most important foundation energy industry in the process of the economic development, it also the foundation of the development of the whole national economy, its development trend directly influences on the overall situation of national economy in China. Most of our electric power industry listed companies are from originally state-owned enterprises, which exists the common characteristics of state-owned enterprises in China. Electric power industry is a capital intensive industry, in the development process, the capital requirement comes from the internal accumulation company itself, and also comes from various financing channels outside, the power industry's financing structure reasonable or not directly relates to company's market value and corporate performance. Therefore, pay much attention on the choice of the electric power industry's financing structure seems necessary and important. According to our country electric power industry listed companies' annual data statistics find that, most of their capital are from the external financing, especially debt financing. The study of the relationship between listed company of electric power industry debt financing structure and financial performance, not only has reference value on how to solve electric power industry's financing decision, but also helps power industry listed companies realize their goals.Based on the study of the relationship between our country electric power industry listed companies'debt financing structure and financial performance, from debt level, debt maturity structure and debt type structure three aspects, based on our country electric power industry listed companies'financial statement data, using comparative analysis, descriptive statistics analysis and qualitative and quantitative analysis methods, using least squares and regression analysis, establishing linear multi-regression model, thoroughly analyzes the relationship of different debt financing structure of our electric power industry listed company and financial performance and comes to the conclusions of debt ratio of power industry listed companies negatively correlated with financial performance, and proposes policy suggestions that our electric power industry listed company should expand financing channels, optimizing the financing structure, strengthen its corporate governance and their profitability.The paper has six chapters, each chapter's main content as follows:Chapter 1:Introduction. Introduce the research background and significance, research ideas, paper structures and methods, as a detailed planning for the after study.Chapter 2:Literature review. Summarize and review the domestic and foreign literatures on the relationship between debt financing structure and financial performance. According to the classification of debt financing structure, this paper reviews empirical researches from three aspects:the relationship between debt level and financial performance, the relationship between debt maturity structure and financial performance, and the relationship between debt type structure and financial performance. Through analyzing literatures, the author discovers that foreign scholars optimistic think the relationship between debt financing structure and financial performance, they believe that debt financing can promote financial performance, such as Heinkel (1982) thought that the profitability of companies with debt-equity ratio is positive correlated.1 Domestic about this study doesn't form a unified opinion. This shows that the research on the relationship between China's listed companies'debt financing structure and financial performance is very necessary and urgent.Chapter 3:Theoretical analysis. Definite the important concepts:debt financing, debt financing structure and financial performance. In this paper, debt financing structure is divided into three aspects, respectively is debt level, debt maturity structure and debt type structure, this financial performance of this paper refers to the company profitability, which can pass profitability indicators to measure. And introduce the capital structure theory and debt financing theories: MM theory, Balance theory, Agency cost theory, Signal theory and Pecking order financing theory. Through analyzing theories, the author summarizes the advantages of debt financing: first, liabilities tax shields role. Debt interest duty payment before, with tax savings effect, can help companies locally-based; Secondly, financial leverage. Debt interest is relatively fixed, so when the company's pre-tax profit increases, every dollar interest pre-tax profits by burden of interest will be reduced, deduct income tax can be assigned to the owners of the company profits will increase, and then give extra income to the owners of the company. Third, debt financing for the operator has incentive and restraint function. Finally, debt financing can influence outside investors to company's judgment, thus influence corporate performance. Also should notice that when liabilities increase, the corporate financial risk also increases. Therefore, we need to weigh the pros and cons, reasonable use this "double-edged sword" of liabilities.Chapter 4:Theoretical analysis of the relationship between our country electric power industries listed company debt financing structure and financial performance. Theoretically analyses the existing problems of our listed companies' financing structure, the positive and negative effects on debt financing for financial performance, as well as current situation and cause with debt financing of our country electric power industry listed company. The analysis shows that the listed companies in China at present financing conditions exist in the following problems:1. The financing single structure, rely mainly on bank credit financing.2. Financing order doesn't agree with Pecking order financing theory.3. Debt structure unreasonable, current liabilities high proportion.In the electric power industry listed companies, existing problems mainly for increasing asset-liability ratio, the financing of single structure, debt maturity structure imbalance. Investigate the reasons, both economic operation level and company itself development level. Mainly exist in the following points:1. Fixed assets large-scale investment is the main cause of asset-liability ratio rose.2. State-owned Banks and power industries listed company "state-owned" homogeneity make credit exist soft restriction, our country present lacks of perfect commercial credit system and commercial credit environment, and our country's present bond market does not well developed, financing scale is lesser, are all reasons of financing single channel.3. Due to China's bond market underdeveloped allow companies'external debt financing most relies on bank loan, but bank loan most for short-term and long-term borrowings benchmark interest rate is higher than the return on assets and other reasons, led to corporate debt maturity structure imbalance.Chapter 5:Empirical analysis of the relationship between our country electric power industries listed company debt financing structure and financial performance. Mainly from the perspective of positivism to study the electric power industry listed company debt financing structure impact financial performance. According to our country stock exchange of electric power industry listed companies'2005-2009 sample data, debt level index (asset-liability ratio), debt maturity structure index (short-term and long-term leverage ratio), debt type structure index (commercial credit rate and bank loan rate) for explained variables, the financial performance indicator (ROE, ROA, OPE and EPS) for be explained variables, establish a regression model, through statistical software for descriptive statistical analysis and regression analysis, and draw the following three conclusions:1. The asset-liability ratio and financial performance negatively correlated.2. Both short-term asset-liability ratio and long-term asset-liability ratio negatively correlated with financial performance.3. Both commercial credit rate and bank loan rate negatively correlated with financial performance.Chapter 6: Conclusions and recommendations. Through empirical analysis, this paper concludes that debt financing structure and financial performance negatively related. In order to improve the financial performance of power industries listed company, realize the value maximization, according to the empirical research conclusions, put forward the following several policy proposals:1. About asset-liability ratio and financial performance is inversely related policy suggestions, concrete are:(1) Improve electric power industries listed company internal financing ability.(2) Use of capital market advantages, issuing new shares, share allotment.(3) Develop electric power industrial investment funds.(4) Actively develop lease financing business.2. About both of short-term asset-liability ratio and long-term asset-liability ratio negatively related to financial performance policy suggestions:(1) A modest increasing in the long-term liabilities rate.(2) Establish dynamic optimal financing structure.3. According to commercial credit rate,bank loan rate and financial performance are negatively related policy suggestions, specific include:(1) Establish perfect commercial credit system.(2) Establish perfect debt security mechanism.(3) Intensify banking supervision, allow banks shares held moderate, and strengthen the debt financing "hard constraint" mechanism.(4) Perfect our country's bond market, actively applying for issuing electric power bonds.The main contributions of this study are:1. Using electric power industry listed company as the breakthrough point of this paper. Domestic to the relationship between financing structure and financial performance of empirical research basically list whole company as the research object. Due to the particularity of electric power industry, it is different from other industries; these conclusions do not fully reflect the financing of electric power industry. Aiming at the relationship between electric power industry listed company debt financing structure and financial performance with empirical research, it has reference value to the listed company of electric power industry financing decision.2. On data choice, use the latest data. This paper selects our country's stock exchange electric power industry listed companies'2005-2009 data as sample for regression analysis. On one hand, we can find the latest research trend, on the other hand, also keep research consistency.Of course, this paper also exists some shortages, include:1. Sample interval choice particularity. This paper chooses 2005-2009 as sample interval, at this time, China's stock market has experienced from the big bull market to big bear market, the companies'market value are seriously distorted, and it has certain effect to the study results. In addition, in 2005, China began share-trading reform, the existence of non-tradable let investors hardly respond to changes of corporate capital structure. In this paper that the conclusions maybe not correct after completion of reform of non-tradable shares formed.2. Financial performance indicators remain to be improved. Due to the limitations of index selection, unavoidably exists shortness. In the later study, can try some other methods, for example, the principal component analysis, constructs comprehensive indicators to measure the financial performance, and avoids the above shortcomings. |
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