The Impact of Working Capital, Capital Structure, and Firm Size on Profitability of Publicly Listed State-Owned Enterprises: The Moderating Role of Public Ownership

This study examines the effects of working capital, capital structure, and firm size on profitability, measured by Return on Assets (ROA), and investigates whether public ownership moderates these relationships in publicly listed Indonesian state-owned enterprises (SOEs). The study uses a quantitative design and Moderated Regression Analysis (MRA) on 18 non-banking SOEs listed on the Indonesia Stock Exchange in 2024, selected through purposive sampling. The direct-effect model shows that working capital has a positive and significant effect on profitability, while capital structure and public ownership do not have significant direct effects. Firm size also has a positive and significant effect on profitability. In the moderation model, the interaction between capital structure and public ownership is negative and significant, whereas the interactions between working capital and public ownership and between firm size and public ownership are not significant. The moderated model explains 76.7% of the variation in profitability based on the adjusted R-squared, and the overall model is statistically significant. The findings indicate that profitability among listed SOEs is strongly associated with internal resource management, particularly working capital and organizational scale, while public ownership functions primarily as a governance mechanism that changes the relationship between financing decisions and profitability