FINANCIAL FAILURE PREDICTION OF THE LEADING AIRLINE COMPANIES IN THE TURKISH AIRLINE SECTOR: AN ANALYTICAL ANALYSIS

Abstract

Overall discussed in the global civil aviation industry and airline companies in both Turkey and the world's top-level competition occurs, the increasing importance of national and international regulations; It is a sector that holds many risk factors such as economic, political, social, cultural, environmental, climatic, terrorism, epidemic diseases to varying degrees.

Airline companies operating in such a sector try to keep their financial performance at an acceptable level. In the study, Turkish Airlines A.O., which is in the Turkish Civil Airline Sector and traded in the BIST-100. and Pegasus Hava Taşımacılığı A.Ş.'s 2014-2018 Balance Sheet, Income Statement, Equity Change Table, and Cash Flow Tables were used as data set. Based on the amounts of the relevant account items from the specified financial statements, Altman and Springate Z Scores of both companies and H Values of Fulmer were calculated, and based on these, the financial failures of the companies were estimated. In financial failure prediction with all three multi-dimensional financial analyses; The results of both companies were found to be satisfactory in the Fulmer H Value Model. While the Altman and Springate Z Score Model is based on the evaluation of fewer factors, in the Fulmer H Value Model, 9 factors are taken into consideration, and it is evaluated that it can give a healthier result.

 According to estimates of 1-4 years following the periods examined according to the Altman Z Score Model, it is possible that the bankruptcy risk may be low for THY A.O. in every four years (buffer zone), Pegasus Taşımacılık A.Ş. has no bankruptcy risk except for the last year; According to estimates of 1-4 years following the periods examined according to Springate Z Score Model, it is possible that both THY A.O. and Pegasus Taşımacılık A.Ş. According to Fulmer's H Value Model, it is evaluated that both THY A.O. and Pegasus Taşımacılık A.Ş. do not have bankruptcy risk in every four years estimated. According to the Altman Z Score Model and Springate Z Score Models, it is generally considered that both airline companies have bankruptcy risk, and the fact that both airlines do not have a bankruptcy risk in Fulmer's H Value Model is due to the fact that more parameters are included in the model in the Fulmer H Value Model.

In each of the three bankruptcy risk estimation models that are subject to the study, the predictions made for the future periods are made according to the regression equations. It should be taken into account that the trend may change with important macro effects that may be experienced in the future.

Civil aviation sector discussed at the global level as well as in Turkey and airline companies in the world as well as a top-level competition occurs, the increasing importance of national and international regulations; It is a sector that holds many risk factors such as economic, political, social, cultural, environmental, climatic, terrorism, epidemic diseases to varying degrees. Airline companies operating in such a sector try to keep their financial performance at an acceptable level.

The Turkish Airlines A.O. Turkey's "flag carrier is also a carrier flag" while an airline, Pegasus Transportation Co. "Low-cost airline carrier-low cost carrier" is featured Turkey's two leading airlines. In financial failure prediction with all three multi-dimensional financial analyses given above; The providers of both companies in the Fulmer H Value Model were found to be satisfactory. While the Altman and Springate Z Score Model is based on the evaluation of fewer factors, in the Fulmer H Value Model, 9 factors are taken into consideration, and it is evaluated that it can give a healthier result.