Profit is one of the most important factors in managing companies. As construction companies run their business on a project basis, their cash flow differs from that of companies in other industrial sectors. This study empirically analyzes the financial factors and explains the profit of construction companies based on the financial statement data for construction companies in South Korea. This paper presents two approaches for extracting financial independent variables that presumably affect the return on equity (ROE) representing the profitability of a company. The first approach involves conducting an in-depth literature review and extracting variables frequently used in prior research studies. The second approach uses the stepwise logistic regression. In the experiment, the dependent variable, ROE, was predicted by a series of neural network analyses. The experimental results show that the model selecting the independent variables through stepwise logistic regression is more predictive than the model that selects independent variables from the literature review. This study adds empirical evidence of financial factors affecting financial performance in the construction industry.
|Title of host publication||Computing in Civil Engineering 2021 - Selected Papers from the ASCE International Conference on Computing in Civil Engineering 2021|
|Editors||R. Raymond A. Issa|
|Publisher||American Society of Civil Engineers (ASCE)|
|Number of pages||8|
|Publication status||Published - 2021|
|Event||2021 International Conference on Computing in Civil Engineering, I3CE 2021 - Orlando, United States|
Duration: 2021 Sept 12 → 2021 Sept 14
|Name||Computing in Civil Engineering 2021 - Selected Papers from the ASCE International Conference on Computing in Civil Engineering 2021|
|Conference||2021 International Conference on Computing in Civil Engineering, I3CE 2021|
|Period||21/9/12 → 21/9/14|
Bibliographical notePublisher Copyright:
© 2021 Computing in Civil Engineering 2021 - Selected Papers from the ASCE International Conference on Computing in Civil Engineering 2021. All rights reserved.
All Science Journal Classification (ASJC) codes
- Civil and Structural Engineering
- Computer Science Applications