THE EFFECT OF SALES GROWTH, ACCOUNTS RECEIVABLE TURNOVER, AND WORKING CAPITAL TURNOVER ON NET PROFIT MARGIN IN COMPANIES IN THE PHARMACEUTICAL SUBSECTOR

Abstract

This study aims to analyze the effect of Sales Growth, Accounts Receivable Turnover, and Working Capital Turnover on Net Profit Margin in pharmaceutical sub-sector companies listed on the Indonesia Stock Exchange during the 2018–2024 period. Net Profit Margin is a profitability ratio used to measure a company's ability to generate net income from its sales activities. This study employed a quantitative method with an associative approach. The data used were secondary data obtained from the annual financial statements of the companies. The sampling technique used was purposive sampling, resulting in 11 companies as research samples. After transforming the data using the Natural Logarithm (Ln) method to meet the normality assumption, 50 observations were used in the analysis. The analytical methods included descriptive statistics, classical assumption tests, multiple linear regression analysis, hypothesis testing, and coefficient of determination analysis using SPSS software. The results indicate that partially, Sales Growth has no significant effect on Net Profit Margin with a significance value of 0.311, Accounts Receivable Turnover has no significant effect on Net Profit Margin with a significance value of 0.934, while Working Capital Turnover has a significant effect on Net Profit Margin with a significance value of 0.015. Simultaneously, Sales Growth, Accounts Receivable Turnover, and Working Capital Turnover have a significant effect on Net Profit Margin with a significance value of 0.027. The coefficient of determination (Adjusted R Square) of 0.126 indicates that the independent variables are able to explain 12.6% of the variation in Net Profit Margin, while the remaining 87.4% is explained by other factors outside the scope of this study.