Prediction of Bankruptcy in the Agro-Food Industry in the City of Kinshasa: Application of Edward Altman’s Z-Score Model

Abstract

Corporate bankruptcy prediction has become a major concern in financial decision-making. However, despite the extensive validation of Altman’s revised Z’-score model in developed and emerging economies, its application to the agri-food industry in the Democratic Republic of the Congo remains largely underexplored. This study addresses this gap by assessing the bankruptcy risk of seven major agri-food firms opereting in Kinshasa province over the 2018-2024 period using the revised Altman Z’-score model and financial data adjusted for inflation and exchange rate volatility. The findings reveal that more than half of the firms are classified whithin the distress zone, indicating a high level of finacial vulnerability accross the sector, while only a few firms exhibit sustained financial soundness. By providing empirical evidence from the congolese context, this study contributes to the literature on corporate faillure prediction in developing economies and offers valuable implications for managers, investors, creditors, and policymakers.

Classification JEL : G33, G32, C53, L66

Article Type : empirical research