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Abstract

This study looks into how the profitability of coal mining businesses listed on the Indonesia Stock Exchange is impacted by fluctuations in the rupiah exchange rate and Indonesia's export proceeds (DHE) retention policy. Using an explanatory quantitative approach, the analysis employs a balanced panel of 90 firm-year observations from 18 coal mining issuers during 2021-2025, drawn from public financial statements and Bank Indonesia’s JISDOR data. We define profitability as EBIT to total assets, reconstructed using a bottom-up method, with annual exchange rate change, DHE exposure, and cash liquidity as explanatory variables. Model specification tests (Chow, Hausman, and Breusch-Pagan LM) indicate that the Random Effects Model estimated with EGLS is most appropriate. The findings reveal that profitability is negatively and significantly influenced by exchange rate movement (β = −0.362; p < 0.01), positively influenced by DHE exposure at the 10% significance level (β = 0.550; p = 0.096), and not significantly affected by cash liquidity (β = 0.040; p = 0.190). About 34.9% of the difference in profitability can be explained by the model. These findings show that currency fluctuations are the primary pressure on operating profitability, as operating and capital costs are predominantly denominated in foreign currencies, while DHE retention has no evidence of reducing profitability. Policymakers should continue monitoring strategies and improve firm management, while also monitoring stricter DHE regulations. Even so, the findings need to be read with caution given the short observation period, limited sample size and lack of control variables.

Keywords

Exchange Rate Export Proceeds Retention (DHE) Profitability Coal Mining Panel Data Regression

How to Cite

Citation Format
Wijayanto, R., Firdaus, F., Nusantara, A., & Baskara, A. (2026). Effects of Export Proceeds Retention and Exchange Rate Movement on the Profitability of Indonesian Coal Mining Companies. International Journal of Management Science and Information Technology, 6(2), 3213-3221. https://doi.org/10.35870/ijmsit.v6i2.9004

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Author Biographies

Ryan Wijayanto, Universitas Muhammadiyah Semarang

Management Study Program, Faculty of Economics, Law, and Business, Universitas Muhammadiyah Semarang, Semarang City, Central Java Province, Indonesia

Firdaus, Universitas Muhammadiyah Semarang

Management Study Program, Faculty of Economics, Law, and Business, Universitas Muhammadiyah Semarang, Semarang City, Central Java Province, Indonesia

Agung Nusantara, Universitas Muhammadiyah Semarang

Management Study Program, Faculty of Economics, Law, and Business, Universitas Muhammadiyah Semarang, Semarang City, Central Java Province, Indonesia

Andika Baskara, Universitas Muhammadiyah Semarang

Management Study Program, Faculty of Economics, Law, and Business, Universitas Muhammadiyah Semarang, Semarang City, Central Java Province, Indonesia

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Copyright (c) 2026 Ryan Wijayanto, Firdaus, Agung Nusantara, Andika Baskara

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