The performance of high-tech companies: The evidence from the Visegrad Group

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JEL classification

• Hypothesis Testing: General
• Data Collection and Data Estimation Methodology; Computer Programs: General
• General Regional Economics (includes Regional Data)

Keywords

Financial performance, high-tech companies, Visegrad Four

Abstract

The purpose of this paper is to analyse the financial performance of large high-tech companies (both product- and service-oriented) in the Visegrad Four (V4) countries. We concentrate on the five-year period from 2007 to 2011. As the performance indicators, the most frequent financial measures – liquidity, profitability and solvency ratios – are used. We use two-dimensional classification to analyse the financial situation of large high-tech companies among the countries in the Visegrad Group. The research sample includes 139 Czech, 68 Hungarian, 270 Polish and 37 Slovak large high-tech companies. The results from this study indicate that the profitability, liquidity and solvency ratios increased in large manufacturing high-tech companies within the investigated period in the Czech Republic and Slovakia, while in Poland and Hungary the situation in the manufacturing sector was exactly the opposite. In terms of the service high-tech sector in the Visegrad countries, the ratios are volatile with a decreasing tendency. The results also indicate that the high-tech sector consists of companies with high liquidity, rather than companies with strong profits. Finally, correlation and regression analyses are conducted to examine the nature and extent of the relationship between profitability and liquidity.