Do Turkish Companies and German Companies in Germany Differ in Terms of Financial Performance?

Nurhan Aydin, Metin Coskun, Arda Surmeli, Gulsah Kulali


Turkish immigrants have always been an important dynamic for the social and business life in Germany since
October 1961, “Agreement for Sending the Turkish Workers to Germany”. They have then started to become
important players as entrepreneurs in the economy after 1990s. This study aims to analyze performance of
Turkish and German companies in production and service industries operating in Germany by using financial
analysis methodology, and it aims to compare the results. Using 2007 financial data, the empirical results show
that Turkish firms in both industries take more liquidity risk than their German counterparts while they are using
less leverage in order to finance their investments. Moreover, Turkish companies have less profitability than
German companies with the effect of high cost of debt. Especially in service industry, Turkish firms have low
level of return for a unit of risk and low level of output for a unit of input.

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