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Faith Mashavave, Kunofiwa Tsaurai ORCID logo


The research aims to find out the relationship between capital structure and profitability focusing on firms listed on the Johannesburg stock exchange in South Africa. Past research on this topic excluded the Johannesburg Stock Exchange listed firms. The research results will be useful to the business people in South Africa because it will be more in line with the South African economic status and thus relevant. From the graphs and tables of the companies analyzed, it appears there is no relationship between the capital structure and profitability. The fluctuations in the debt/equity ratio and profitability ratio are so severe to such an extent that no meaningful conclusion regarding the relationship between capital structure and profitability can be made. The outcomes are haphazard there is no uniformity and consistence on the outcomes. Other hindrances to the relationship between capital structure and profitability were also discovered and these were attributed to the environmental factors of the company such as economic, political, and social and all other external forces that companies under study were exposed to.

Keywords: Capital Structure; Profitability; JSE

How to cite this paper: Mashavave, F., Mashavave, K. (2015). Capital structure and profitability. A case of JSE Listed Companies. Risk governance & control: Financial markets & institutions, 5(1), 81-93.