DEVELOPING AN EMPIRICAL FINANCIAL PERFORMANCE MODEL: A CASE STUDY OF PT KIMIA FARMA (PERSERO) TBK

Abstract

PT. Kimia Farma (Persero) Tbk, one of Indonesia's leading pharmaceutical companies, operates as a public company or State-Owned Enterprise (BUMN) in the pharmaceutical industry. The decline in profit caused the losses that occurred in 2022 to be of significant concern, reaching -109 billion, where the company suffered a striking loss of 399 billion compared to a high profit of 289 billion in 2021. This study aims to evaluate the financial performance of PT. Kimia Farma (Persero) Tbk from 2018 to 2022 using vertical and horizontal analysis methods. The results of this research are presented in the form of financial performance models and recommendations, specifically designed for the company itself and investors who require accurate financial information. This research is conducted using a descriptive approach, relying on secondary data, specifically balance sheet reports available on the company's official website. The data analysis employed is common-size analysis and comparative analysis of financial statements. From the research results, it can be seen that the financial condition of PT. Kimia Farma (Persero) Tbk is considered to have risks that need to be considered, and financial performance needs to be improved to overcome these challenges. These practical implications will lead to important recommendations for companies, which will be discussed and delivered at the end of this article