Determinants Of Aviation Profitability The Case Of Ethiopian Airlines

In order to be competitive, profitability of a firm plays an undeniable role and investigation ofrnthe factors determining profitability of a firm would provide useful insights. Therefore, the mainrnpurpose of the study is to show factors that determine Ethiopian Airlines profitability. Therndependent variable profit was regressed against growth, liquidity, leverage, tangibility of asset,rnlease and fuel cost, to show which factor determine Ethiopian profitability. The study usedrnexplanatory research design and multiple regression model is used to show the impact of thernindependent variables on the dependent variable. The study used quantitative and qualitativerndata, obtained from secondary source from 1981-2015.The data was analyzed using time seriesrneconometrics methodology. The analysis is done by using E-view 8. The result revealed that fuelrncost, liquidity and leverages are statically significant to explain the dependent variable. Besides,rntangibility of asset, lease cost and leverage ratios have negatively correlated with Ethiopianrnairlines profitability. Finally, it is recommended that the airline should have more concernrnto liquidity, fuel and leverage than growth and tangibility of asset.rnKeywords: Ethiopian airlines, Profitability, internal factors, financial statement.rnDeterminants of Ethiopian Airlines profitability

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