Financing Structure and Financial Performance of Selected Quoted Consumers Goods Companies in Nigeria.

Abstract:

This study investigated how financing structure affects the financial performance of consumer goods companies listed on the Nigerian Exchange Group (NGX). Ex-post facto research design was used, analyzing secondary data from the annual reports of 16 out of 21 sampled companies. Using Stata, descriptive and inferential statistical analyses were carried out. The results revealed varied impacts: Equity positively and significantly affected return on assets (ROA), had a negative but insignificant effect on price earnings ratio (PER), and a negative and significant effect on earnings per share (EPS). Short-term debt positively and significantly affected ROA and EPS, while its effect on PER was positive but insignificant. Long-term debt positively and significantly affected ROA, had an insignificant positive effect on PER, and a negative and significant effect on EPS. Overall, financing structure significantly impacted the financial performance of consumer goods companies in Nigeria. It was recommended that organizations carefully plan and monitor their financing structure to optimally leverage debt.