THE EFFECT OF LEVERAGE AND OPERATING CASH FLOW ON FINANCIAL DISTRESS WITH PROFITABILITY AS A MODERATION VARIABLE IN MINING COMPANIES LISTED ON THE INDONESIA STOCK EXCHANGE (IDX) 2019-2022 PERIOD

Abstract

This study aims to determine the effect of leverage proxied by DAR, and operating cash flow on financial distress conditions, moderated by profitability proxied by ROA, in mining companies listed on the IDX in 2019-2022. The data used in this research are secondary data, namely annual reports of mining companies obtained from the official websites of the companies and the Indonesia Stock Exchange. This research was processed using Eviews 12 software with multiple regression analysis methods and moderate regression analysis (MRA). The population of this study was all mining companies listed on the Indonesia Stock Exchange in 2019-2022, a total of 60 companies, and the final 29 companies were selected using a purposive sampling technique. The results of this study concluded that leverage has a significant positive effect on financial distress. Operating cash flow has a significant positive effect on financial distress. Profitability is able to moderate the effect of leverage on financial distress. However, profitability cannot moderate the effect of operating cash flow on financial distress.