Financial Performance Indicators of Small and Medium-Sized Enterprises in the Republic of Croatia

Small and medium-sized companies are the backbone of a country’s economic growth. The number of small and medium-sized companies has significantly increased in the last ten years as opposed to a decreasing number of large companies on an annual basis. In light of their increasing influence on the economic growth, this paper focuses on defining financial performances of the select economic activities by comparing their financial ratios. The paper aims at defining the condition, structure and changes of the select activities as well as analyses their performances in the period from 2008 to 2014 in order to determine their impact on the overall state of the economy. The analysis of the select activities was conducted by determining financial ratios on the basis of data collected from secondary sources on a sample of 50 companies from ten major business activities. The conducted research has found that the economy depends on performance characteristics of several activities, which may have a negative impact on the overall economy in the Republic of Croatia.