ANALYSIS OF ECONOMIC FACTORS THAT INFLUENCE NET PROFIT MARGIN OF PT. UNILEVER INDONESIA FOR 2005 – 2012

Abstract

The company was founded with the aim of increasing the value of a company that can provide prosperity for owners or shareholders. In analyzing and assessing the financial position and the potential or the progress of the company, there are several factors that need to be considered, and one of the most important is profitability. Sample taken from one of the largest manufacturing company in Indonesia, Unilever Indonesia, that has grown to be a leading company of Home and Personal Care as well as Foods, Beverages, and Ice Cream products in Indonesia. The performance of Unilever Indonesia could be maintained so that continuity of business also could be well maintained. Those performances could be measured by the size of the company’s profitability. The factors affecting the profitability of Unilever Indonesia that used in this study are the Exchange Rate, Inflation Rate, Current Ratio, and Sales Growth Rate. While the purpose of this study was to determine the factors among Exchange Rate, Inflation Rate, Current Ratio, and Sales Growth Rate that dominantly affect the Net Profit Margin (NPM) as one of the profitability ratios in company’s financial performance. The population used for the study are Unilever’s financial statements (internal factors) that have been audited by public accountant, and the external factors are taken by Bank Indonesia and Indonesia Bureau of Labor Statistic official website. All the data, which are secondary data, are taken from 2005 to 2012. For its sampling in this study used purposive sampling and the method of data analysis which is used is multiple linear regression analysis. The results of this study indicate that the Inflation Rate variable has a negative insignificant effect on NPM, Exchange Rate and Current Ratio have negative significant on NPM, while Sales Growth Rate has a positive significant effect on NPM.