ANALYSIS OF WORKING CAPITAL MANAGEMENT IN INCREASING NET INCOME PT. KIMIA FARMA (PERSERO) TBK

Abstract

PT. Kimia Farma is a company engaged in the pharmaceutical industry in Indonesia. Companies are required to run the company based on the existing vision and mission. Therefore the company must be consistent in carrying out these goals. The purpose of this study is to determine and analyze the extent to which the company manages the available working capital in making a profit so that it can increase profitability at PT.Kimia Farma (Persero) Tbk for the 2014- 2018 period. The research approach used in this research is descriptive. Data analysis uses the time series analysis method, which is to compare over time or between periods to make it visible graphically. Data and information were obtained from the PT. Kimia Farma (Persero) Tbk. The data analysis used is the activity ratio analysis which consists of working capital turnover indicators such as cash turnover, accounts receivable, and inventory, while the profitability ratio uses the indicators of Net Profit Margin (NPM), Gross Profit Margin (GPM), Operating Profit Margin (OPM), Return. On Investment (ROI) and Return On Equity (ROE). The results showed that some of the indicators fluctuated and were categorized as still below the company's industry standards in the use of working capital so that it was less effective in increasing its profitability. This was due to the ineffective use of working capital at PT. Kimia Farma due to an increase in current debt that was higher than the increase in current assets such as an increase in trade payables, tax payable, and other payables