Financial Performance and Leverage Determine Sustainable Growth in Consumer Goods Companies on the IDX

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FORMOSA NEWS

Corporate profitability proves to be a primary driver in maintaining the continuity of business growth, while debt levels or leverage play an important role in moderating the operational efficiency of consumer goods sector issuers. This was revealed in a study conducted by Dola Resiya Br Tarigan, Dompak Pasaribu, Merry Anna Napitupulu, and Duma Megaria Elisabeth from the Accounting Study Program, Faculty of Economics, Methodist University of Indonesia, Medan. Published in July 2026, this research examines the financial performance of consumer goods issuers on the Indonesia Stock Exchange (IDX) throughout the period from 2021 to 2024 to provide strategic guidance for investors and industry players.

The consumer goods sector faces dynamic global and domestic economic challenges, including monetary policy tightening and post-pandemic fluctuations in public purchasing power. In this situation, companies are demanded not merely to pursue short-term profits, but to maintain a stable growth rate without relying excessively on external funding.

To dissect this phenomenon, the research team applied an associative quantitative approach using purposive sampling techniques. From the total population of consumer goods companies listed on the IDX, 12 issuers were selected that consistently distributed dividends and met complete data criteria during the 2021–2024 period. Data analysis was performed using statistical software through multiple linear regression analysis and Moderated Regression Analysis (MRA).

Statistical analysis results from this study detail several key findings as follows:

• Profitability Impact (ROA): Return on Assets exerts a positive and statistically significant effect on the Sustainable Growth Rate (SGR) with a coefficient value of 0.509 and a significance of 0.000.
• Asset Efficiency Impact (TATO): Total Asset Turnover shows a positive but insignificant effect on SGR with a significance value of 0.671.
• Simultaneous Test: Simultaneously, profitability and asset efficiency prove to have a significant impact on the company's sustainable growth rate with an F-statistic of 11.781.
• Moderating Role of Leverage (DER): The debt-to-equity ratio proves capable of moderating the relationship between asset efficiency (TATO) and SGR (significance value of 0.008), but fails to moderate the relationship between profitability (ROA) and SGR.
• Coefficient of Determination: The upward and downward variations in a company's sustainable growth rate can be explained by profitability and asset efficiency variables by 55.8%, while the remainder is influenced by other factors outside the research model.

These findings provide strategic implications for investors to assess corporate financial health more carefully, specifically by prioritizing profitability indicators such as ROA as well as observing capital structures and corporate leverage levels. For businesses, these research results emphasize the importance of balancing business expansion with optimal debt management so that companies can grow independently and sustainably.

“Companies are recommended to increase profitability, especially ROA, and improve asset efficiency, and carefully manage leverage to prevent taking on excessive financial risk,” stated the researchers in their study recommendations.

Author Profiles:

• Dola Resiya Br Tarigan: Student in the Accounting Study Program, Faculty of Economics, Methodist University of Indonesia, Medan, with research interests in financial accounting and issuer performance.
• Dompak Pasaribu: Lecturer and researcher at the Faculty of Economics, Methodist University of Indonesia, Medan, actively examining economics and financial management.
• Merry Anna Napitupulu: Lecturer and researcher at the Faculty of Economics, Methodist University of Indonesia, Medan, with expertise in accounting and corporate reporting.
• Duma Megaria Elisabeth: Lecturer and researcher at the Faculty of Economics, Methodist University of Indonesia, Medan, focusing on financial analysis and capital markets.

Research Source:

• Journal Article Title: The Effect of Financial Performance on Sustainable Growth Rate with Leverage as a Moderating Variable in Consumer Goods Industry Companies Listed on the Indonesia Stock Exchange During 2021–2024
• Journal Name: International Journal of Management Analytics (IJMA)
• Publication Year: 2026
• DOI: https://doi.org/10.59890/ijma.v4i3.12