Capital Structure and Financial Performance of Quoted Manufacturing Firms in Nigeria

Abstract

There is a divide of view on the relationship between capital structure and corporate financial performance. This study explored the effects of capital structure on financial performance of quoted manufacturing firms in Nigeria. The study used panel least square multiple regression to examine secondary data gathered from the 14 sampled organizations’ financial statements from 2011 to 2020. The null hypothesis that there is no statistically significant link between total-debt-to-total-equity and return on assets of manufacturing entities in Nigeria was accepted. The study rejected the second hypothesis relating to long-term-debt -to-total-assets. The study recommended that management of manufacturing corporations that are active on the stock market should strive to increase their long-term-debt-to-total-assets so as to improve their business operations and by extension, their financial performance. The study established that there is a beneficial link between capital structure and financial performance of manufacturing companies.

Digitalization of SMEs to Survive Amid The Pandemic

“…Researchers make a hypothesis: H3: Digital Strategy positively has a significant influence on digitalization 5. Financial Performance A company's financial performance is essential, especially for shareholders, because it is used to determine the rate of return on funds invested by investors (Akinrinola et al, 2023). Financial performance is a monetary measure for various businesses using tangible and intangible assets to generate income (Njau & Abdul, 2022).…”