<![CDATA[his study examines the effects of capital structure (Debt-to-Equity Ratio/DER), sales growth, and profitability (Return on Assets/ROA) on financial distress, with firm value (Price-to-Book Value/PBV) acting as a mediating variable. The research focuses on textile and textile products companies listed on the Indonesia Stock Exchange (IDX) during the 2020–2024 period. A quantitative explanatory research design was employed using secondary data obtained from audited annual reports. The sample consisted of six companies selected through purposive sampling, resulting in 30 balanced panel observations. Panel data regression analysis was conducted using EViews 12, while mediation effects were examined using the Sobel Test. The results indicate that capital structure has a significant negative effect on the Altman Z-Score, implying that higher leverage increases the likelihood of financial distress. In contrast, sales growth and profitability do not significantly affect financial distress. Furthermore, firm value significantly mediates the relationships between capital structure, sales growth, profitability, and financial distress, suggesting that market valuation serves as an important mechanism through which firms' financial characteristics influence their financial condition. These findings support Signalling Theory, emphasizing that investors' perceptions reflected in firm value contribute to firms' financial stability. The study provides practical implications for managers in designing financing strategies and maintaining firm value, while offering investors additional insights for evaluating bankruptcy risk in Indonesia's textile industry.]]>
