Economic Determinants of Romanian Firms’ Financial Performance

Pantea, Marius Ioan; Gligor, Delia; Anis, Cecilia – Nicoleta

doi:10.1016/j.sbspro.2014.02.486

Cited by 40 publications

(24 citation statements)

References 29 publications

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“…However, employee growth rate and account receivables turnover nullified the generalization of this theory in the Nigerian manufacturing sector, as those variables were insignificant with regards to profitability. This is contrary to the findings of Pantea et al (2013) and Zhu (2000) both of which suggested a significant relationship between number of employees and financial performance.…”

Section: Discussioncontrasting

confidence: 99%

“…Aremu et al (2013), in their study, applied cointegration and error correction techniques and revealed that cost efficiency, along with credit risk and capital adequacy, were inversely related to financial performance of Nigerian firms while money supply and labour efficiency were directly associated. Pantea et al (2013), in their study, found number of employees to be positively associated with firm performance in Romania, thus, suggesting that efficiency strategies involving decrease in number of employees could lead to reduced firm performance. This result supports that of Sathye (2001).…”

Section: Empirical Frameworkmentioning

confidence: 86%

“…Several measures have been used to measure operational efficiency in different studies e.g. employee growth (Pantea et al, 2013;Sathye, 2001;Zhu, 2000), operating expenses (Ghebregiorgis and Atewebrhan, 2016; Al-Jafari and Alchami, 2014), account receivables turnover (Yameen and Pervez, 2016), inventory turnover (Yameen and Pervez, 2016;Enekwe et al, 2013) and asset turnover (Yameen and Pervez, 2016;Jamali and Asadi, 2012;Fairfield and Yohn, 2001). In the periods under consideration in this study, companies like Nestle Nigeria plc, Nigerian Breweries Plc, Flour Mills Nigeria Plc, Dangote Sugar Plc, GlaxoSmithKline Consumer Nigeria Plc, PZ Cussons Plc, Guinness Nigeria Plc, Unilever Plc and Vitafoam Plc were seen to possess relatively high operational efficiency ratios with average turnovers (Account receivable, Inventory and Asset) greater than 100% and some having average operating expenses below ten billion naira.…”

Section: Operational Efficiencymentioning

confidence: 99%

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Operational efficiency and financial sustainability of listed manufacturing companies in Nigeria

Imhanzenobe¹

2019

J. Account. Taxation

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This study investigates the impact of operational efficiency on the financial sustainability of listed manufacturing companies in Nigeria. The recent economic crisis in Nigeria has caused an alarming decline in financial sustainability indicators of manufacturing companies. Managers are forced to make efficient use of resources to maximize profitability so as to cope with and compete in the harsh economic condition. Several measures of efficiency were analysed in relation to financial sustainability. There is a dearth of studies on effect of operational efficiency on long-term profitability in Nigerian manufacturing sector. Also, stock market performance has been ignored by studies in Nigeria. This study helps to fill these gaps by evaluating the impact of operational efficiency on long-term profitability (return on asset) and stock market performance (Tobin's Q). The efficiency variables considered include; employee growth, operating expenses, account receivables turnover, inventory turnover and asset turnover. A secondary panel dataset ranging from 2009 to 2016 for 16 listed manufacturing companies was obtained from the Bloomberg portal. The Ordinary Least Square method was used to test the 5 formulated hypotheses. The findings revealed that in relation to ROA, operating expenses and asset turnover had negative and positive significant relationship respectively. Employees' growth, account receivable turnover and inventory turnover were found to be insignificant. In relation to Tobin's q, both inventory and asset turnover had a positive significant relationship. Operating expense had a negative significant relationship. Again, employees' growth and account receivables turnover were found to be insignificant. Based on the findings, the study suggests that the common notion of employee retrenchment and keeping a thin workforce may not necessarily promote financial sustainability. The study recommends that firms should strive to reduce their operating expenses and implement efficient strategies that address asset and inventory turnover.

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Section: Discussioncontrasting

confidence: 99%

Section: Empirical Frameworkmentioning

confidence: 86%

Section: Operational Efficiencymentioning

confidence: 99%

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Operational efficiency and financial sustainability of listed manufacturing companies in Nigeria

Imhanzenobe¹

2019

J. Account. Taxation

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“…The adopted measures of the firm performance provide a concrete fundamental for assessing the influence of corruption and institutional quality on the performance of corporations. These measures are consistent with prior studies (Bennouri et al., 2018; Huang and Kang, 2017; Pantea et al., 2014; Raithatha and Komera, 2016; Ringov, 2017; Samson, 2015; Zagorchev and Gao, 2015)…”

Section: Methodssupporting

confidence: 91%

Corruption perception, institutional quality and performance of listed companies in Nigeria

Ojeka

Adegboye

et al. 2019

Heliyon

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We examine the effect of corruption perception and institutional quality on the performance of firms based on the extracted data for 135 listed companies in Nigeria with timeframe 2013–2017. We first use the Transparency International Corruption Perception Index for the baseline analysis, which evaluates the public officials and politicians’ corruption practices. To capture institutional quality, which depicts the level of law enforcement to curb corruptive practices of the public officials, we use the first component via Principle Component Analysis of six governance indicators extracted from World Bank Governance Indicators. We then use the Generalized Method of Moment (GMM) for the analysis. We find that corruption is negatively related to the market value (TobinQ) and accounting value performance (ROA). Similarly, institutional quality is negatively related to TobinQ and ROA. The results suggest that corruption and institutional quality weaken the market and accounting performance firms in Nigeria. We further compare the extent of corruption and institutional quality on performance between financial and non-financial institution. We find that both corruption and weak institutional environment tend to impair the market and accounting-based performance of non-financial firms, which could be traced to the less regulatory body in such institution compared to the financial institution. We suggest that Nigeria needs more effective and strong mechanisms proactive to curb corruption practices and weak institutional quality.

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“…Nunes, Serrasqueiro, and Sequeira (2009) showed that size has a positive and significant effect on profitability in the Portuguese market. Also, using both ROA and ROE as measures of profitability, Yang and Chen (2009) and Pantea, Gligor, and Anis (2014) found that size positively and significantly affected firm performance. Besides, Zeitun and Saleh (2015) showed that size has a positive and significant effect on firm performance in the country.…”

Section: Sizementioning

confidence: 99%

Determinants of profitability in Jordanian services companies

Gharaibeh

Khaled

2020

Investment Management and Financial Innovations

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Due to the uniqueness of the services sector in terms of its characteristics and profitability, as well as the lack of studies on this sector, this study is considered to be the first to improve the knowledge of the key factors that play an important role in the profitability of the Jordanian services sector. This study investigates the effect of financial characteristics and capital structure on the profitability of all 46 services companies listed on the Amman Stock Exchange over the period 2014–2018. This study applies fixed and random effects models to panel data variables, namely, size, tangible assets, growth, business risk, debt to equity ratio and debt to assets ratio as independent variables. At the same time, profitability was measured by operating profits (earnings before interest and tax divided by total assets), return on assets (ROA), and return on equity (ROE), which acted as the dependent variables. This study reveals the first evidence that the debt to assets ratio has a negative and significant impact on the profitability of services companies in Jordan. In line with the pecking order theory, this finding suggests that more profitable services companies tend to prioritize the use of retained earnings in financing business activities rather than in financing debt. This study shows that profitability is significantly and positively affected by size and business risk, while ROA is negatively affected by business risk. It also shows that tangible assets have a negative and significant effect on profitability, while growth has a positive and significant effect on operating profits.

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Economic Determinants of Romanian Firms’ Financial Performance

Cited by 40 publications

References 29 publications

Operational efficiency and financial sustainability of listed manufacturing companies in Nigeria

Operational efficiency and financial sustainability of listed manufacturing companies in Nigeria

Corruption perception, institutional quality and performance of listed companies in Nigeria

Determinants of profitability in Jordanian services companies

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