A Study on Determining the Relationship Between Innovations And Financial Performance

Abstract

This study aims to determine whether there is a significant relationship between innovations and financial performance using multiple regression analysis based on financial data included in annual balance sheets and income statements of Borsa Istanbul (BIST) listed firms with continuous data which display activity in the Metal, Goods, Construction and Machinery and Equipment Sectors during the 2010-2015 period. For this purpose, R&D expenses, intangible fixed assets, ratio of R&D expenses to operating expenses, and ratio of intangible fixed assets to total assets were used as independent variables, and return on equity, return on assets, gross profit to net sales ratio, operating profit to net sales ratio, net sales income, domestic sales income, foreign sales income, and net profit were used as dependent variables. A multiple linear regression and correlation analysis has revealed a significant relationship between independent variables and dependent variables except gross profit to net sales ratio.