The Study On The Correlation Between Debt Financing And Corporate Performance Of Domestic Travel Listed Companies

Debt financing is not only a main way of fund-raising for a listed company，butalso an important corporate governance tool. Effective debt financing is useful toreduce agency costs between shareholders and managers，and can also help protect theinterests of the creditors to enhance company’s performance. In recent years，moreand more domestic academics pay attention to the capital structure and the mode offinancing of listed companies，but few of them have research on the interactionbetween debt financing and corporate performance. With the development of China’stourism industry， more and more travel companies began listing and financing.So，it is a meaningful thing to research the influence that the debt financing have on thecorporate performance based on the funds，which will be helpful to improve thestructure of debt financing and the business performance.Focusing on the debt financing in the capital structure theory，I the theoreticaland empirical analysis of the interaction between debt financing and performance oftourism listed companies in China，which I hope to be useful to enrich the existingresearch. Only a few of empirical research on debt financing and corporateperformance of the travel listed companies in the domestic，and most of them is aboutthe relationship between corporate performance and the specific structure of theoverall capital structure and equity financing.In this article，I study the debt financingin different dimensions，such as the whole，the period，the distribution of the debtfinancing，and specific to different liabilities impact on the performance of theempirical. With the upgrading of China’s comprehensive national strength and thepreferential policies that the government continues to strengthen in recent years， thetravel listed companies continue to develop on the size and performance year afteryear， specifically in2008that the economic crisis swept the globe. The maincontents in this article is about the relationship between the debt financing andcorporate performance of the travel listed companies in the new macro-control andeconomic situation. I use SPSSll.5statistical analysis software for analysis in this article.Combination of domestic and foreign scholars’ research results，I firstly analyze thecorrelation of debt financing and corporate performance in theory. Then I collected anumber of debt financing and operating performance indicators between2006and2010of28tourist listed companies in Shanghai Stock Exchange and Shenzhen StockExchange. The present study is almost based on many performance indicators aboutone company， but one company’s phenomenon can not represents the wholeindustry.In order to more fully reflect the company’s performance，I use principalcomponent analysis to build a new comprehensive performance indicators，and themultiple regression model with control variables，which will be used to check theinteraction between the debt financing and corporate performance through empiricalmeans.The results show that there is a clear correlation between debt financing andresults of operations does in the domestic travel listed companies: There is asignificant negative correlation between the overall level of debt financing and thecorporate performance，not the inverted U-shaped structural relationship in thetrade-off theory； There is a significant negative correlation between the long-termliabilities and the corporate performance， and not a very significant positivecorrelation between the short-term liabilities and the corporate performance， andmore importantly， the degree of the impact of the long-term liabilities is moreapparent than the short-term liabilities； There is a significant negative correlationbetween the performance and the company’s bank loans and commercial credit， butthe commercial credit just have a weak negative impact on corporate performance；There is a positive correlation between the company size and the performance， butthe returns to scale in a decreasing state. Finally， I attempts to analyze the reasonsfor the empirical results，and in order to more effectively use the tool of debtfinancing to improve corporate governance and use the signal role of corporateperformance to improve the company’s capital structure，I put forward correspondingcountermeasures and suggestions for relevant department. Should give more attentionto debt financing and enhance its role in corporate governance，and actively use thesignal role of corporate performance to improve the capital structure， and greatlyimprove the positive interaction betweent debt financing and company performance.