Capital Structure, Sales Growth, and Liquidity Effects on Profitability in Property Companies

Abstract

Profitability optimization represents a critical success factor requiring a comprehensive understanding of financial determinants in the property sector. This research examines the capital structure, sales growth, and liquidity impacts on profitability measured through return on equity among Indonesian property companies during 2021–2023. Employing quantitative methodology with purposive sampling, 78 firm-year observations comprised the research sample. Data analysis includes multiple linear regression with classical assumption tests utilizing SPSS version 27. Empirical findings reveal capital structure exerts a negative and significant effect on profitability, while sales growth and liquidity demonstrate negative but insignificant influences. Collectively, variables explain 62.5% profitability variance, with the remaining 37.5% influenced by unexamined factors, offering strategic insights for financial decision-making optimization.