Technical Efficiency and Profitability of Listed Transportation and Logistics Companies in the Stock Exchange of Thailand

Abstract

This study aims to examine the technical efficiency and profitability of 16 listed transportation and logistics companies in the Stock Exchange of Thailand during 2010 – 2014 and also to investigate the effect of technical efficiency on profitability of these companies. Technical efficiency, in this study, is the overall technical efficiency based on CCR Data Envelopment Analysis (DEA) while profitability is measured by two indicators, including return on assets (ROA) and return of equity (ROE). The findings reveal that the overall technical efficiency of transportation and logistics companies in Thailand are not very high, having the average technical efficiency of 79.30 percent. In addition, the average ROA and ROE of these companies equal 3.35 and 2.11 percent, respectively, during the study period, implying not very high profitability. Additionally, the findings reveal that technical efficiency has no statistically significant effect on profitability. However, profitability in this study is found to be determined by debt, liquidity and size of company.