Research Article

LEVERAGE AND PROFITABILTY OF LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA

Usman Umar Naibi1*, Aminu Mohammed Bashir1, Abubakar Mohammed2, Abdullahi Inuwa Njidda3
1 Department of Accountancy, Modibbo Adama University, Yola, Nigeria
2 Department of Accountancy School of Business and Management Technology, Federal Polytechnic Mubi
3 Department of Accountancy Adamawa State Polytechnic, Yola. Adamawa State, Nigeria.
* Corresponding author: usmanumarnaibi@femsbukjournals.org.ng/bjms
Published: Dec, 2023
DOI: 10.67894/bjms.2023.oqda2ypg
Pages: 58-76

Abstract

The study examines the effect of leverage on profitability of listed industrial goods firms in Nigeria for the period of 2012-2022.The sample size is 11 industrial goods firms out of the 13 industrial goods firms listed on the floor of Nigeria Exchange Group. It uses balance panel the secondary data are extracted from the financial reports and accounts of the companies that are used as the sample of the study. It employs Generalized Least Square Random Effect as the best estimator of the regression model. The study reveals that long term debt has significant and negative impact on profitability of listed industrial goods firms in Nigeria. It also finds that debt to equity ratio has positive but insignificant effect on profitability. The paper recommends that industrial goods firms in Nigeria should use long-term debt with low interest rate to financed long term project and explore alternative financing sources such as equity financing. Financial institutions should develop innovative financial products tailored to the needs of industrial goods firms, by providing competitive interest rates.  

Keywords

Leverage long term debt profitability industrial goods firms

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How to Cite

Naibi, U. U., Bashir, A. M., Mohammed, A., & Njidda, A. I. (2023). LEVERAGE AND PROFITABILTY OF LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA. Bayero Journal of Management Sciences, 5(2), 58-76. https://doi.org/10.67894/bjms.2023.oqda2ypg

U. U. Naibi, A. M. Bashir, A. Mohammed, and A. I. Njidda, "LEVERAGE AND PROFITABILTY OF LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA," Bayero Journal of Management Sciences, vol. 5, no. 2, pp. 58-76, December 2023. doi: 10.67894/bjms.2023.oqda2ypg

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