Overdosed? Analysis of the financial leverage of CSN

Authors

DOI:

https://doi.org/10.18568/internext.v18i3.693

Keywords:

Capital structure, Financial leverage, Decision making

Abstract

Objective: to illustrate the use of concepts and implications associated with capital structure, cost of third-party capital, financial leverage, and bankruptcy costs to support strategic decision-making by the management of a publicly-held company listed on Brasil, Bolsa, Balcão [B]³ and on the New York Stock Exchange (NYSE).

Method: Data were obtained through financial reports, such as Income Statement, Balance Sheet, Explanatory Notes, as well as consultations to the Management Reports, material facts disclosed, and media facts.

Main Results: the case guides a decision by the company in the short term, such as investing in operating performance, renegotiating terms, selling assets, and carrying out an Initial Public Offering (IPO) of a subsidiary.

Relevance / Originality: this teaching case innovates by illustrating the economic and financial situation of a company, involving issues such as operating performance, cash generation, and capital structure for the decision-making process. Such analysis is important for both the academic and the organizational context as it is a theoretical application in a real company.

Theoretical / Methodological Contributions: The case contributes to a deeper analysis of the consequences of excessive indebtedness linked to low cash generation by an entity, the impact of debt costs on the company’s results, and management attitudes toward the situation of excess indebtedness.

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Author Biographies

Caritsa Scartaty Moreira, Universidade Federal da Paraíba – João Pessoa (PB), Brasil.

Doutoranda em Ciências Contábeis pela Universidade Federal da Paraíba (UFPB). Mestra em Ciências Contábeis pela Universidade Federal do Rio Grande do Norte (UFRN). Especialista em Contabilidade e Planejamento Tributário pela Universidade Federal Rural do Semi-Árido (UFERSA). Graduada em Ciências Contábeis pela UFERSA. Tem experiência em Ciências Contábeis e interesse na linha de pesquisa informação contábil para usuários externos, atuando principalmente nos seguintes temas: mercado de capitais, avaliação de empresas, fraudes e manipulações contábeis e educação contábil.

Allisson Silva dos Santos, Universidade Federal da Paraíba – João Pessoa (PB), Brasil.

Mestre em Administração com ênfase em Finanças e Métodos Quantitativos pelo Programa de Pós-Graduação em Administração - PPGA da Universidade Federal da Paraíba - UFPB. Especializando em Metodologias Ativas pela Universidade Federal do Vale do São Francisco - UNIVASF. Bacharel em Administração pelo Instituto Federal de Educação, Ciência e Tecnologia da Paraíba - IFPB. Integrante do Núcleo de Pesquisas em Educação Financeira de Impacto - NUPEFI/IFPB e do Núcleo de Estudos em Gestão e Negócios - NEGN/IFPB. Possuo a certificação financeira CPA-20 emitida pela ANBIMA.

Anderson Dias Brito, Universidade Federal da Paraíba – João Pessoa (PB), Brasil.

Mestre em Administração com ênfase em Finanças e Métodos Quantitativos pela Universidade Federal da Paraíba. Especialista em Gestão de Produção e Logística Empresarial pela Universidade Cândido Mendes. Graduado em Administração pela Universidade Estadual do Sudoeste da Bahia (2019). Tem experiência na área de Administração com ênfase em finanças, gestão de produção, suprimentos, métodos e Sistemas.

References

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Nguyen, V. C., Nguyen, T. N. L., Tran, T. T. P., & Nghiem, T. T. (2019). The impact of financial leverage on the profitability of real estate companies: a study from Vietnam stock exchange. Management Science Letters, 9, 2315-2326. https://doi.org/10.5267/j.msl.2019.7.023 DOI: https://doi.org/10.5267/j.msl.2019.7.023

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Published

2023-07-05

How to Cite

Moreira, C. S., Santos, A. S. dos, & Brito, A. D. (2023). Overdosed? Analysis of the financial leverage of CSN. Internext - International Business and Management Review, 18(3). https://doi.org/10.18568/internext.v18i3.693

Issue

Vol. 18 No. 3 (2023): September - December

Section

Teaching Case

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Copyright (c) 2023 Caritsa Scartaty Moreira, Allisson Silva dos Santos, Anderson Dias Brito

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