Capital Structure and Financial Performance of Listed Pharmaceutical Companies in Nigeria
Publication Date: 12/04/2022
Author(s): Ezuma Smart Chinedu.
Volume/Issue: Volume 5 , Issue 2 (2022)
Abstract:
This study investigated the relationship between capital structure and financial performance of listed pharmaceutical companies in Nigeria from 2013–2017. The ex post facto research design was adopted for the study with a population of ten (10) listed pharmaceutical companies in Nigeria as listed by the Nigerian Exchange Group in 2021. Data were retrieved from the annual reports of the selected listed pharmaceutical companies for the period 2013–2017. Multiple regression analysis was used to analyze the data gathered with the aid of Stata12 statistical software. The study revealed a positive and significant relationship between equity capital and profit before tax of listed pharmaceutical companies in Nigeria. It also revealed the existence of a positive and significant relationship between equity capital and return on assets of listed pharmaceutical companies in Nigeria. Therefore, it was recommended that the management of listed pharmaceutical companies in Nigeria should pay more attention to equity capital because it is a major determinant in enhancing profit before tax, and that equity capital should be encouraged so as to boast return of assets of listed pharmaceutical companies in Nigeria.
Keywords:
Capital Structure, Financial Performance, Equity Capital, Profit before Tax, Return on Assets.
