IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT (IJEFM )

E-ISSN 2545-5966
P-ISSN 2695-1932
VOL. 8 NO. 7 2023
DOI: https://doi.org/10.56201/ijefm.v8.no7.2023.pg81.104

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Effect of Firm Life Cycle on Dividend Payout of Listed Manufacturing Firms in Nigeria

Oghenekaro Igbru, Evi Prosper, Agari & Nkechi Joy, Ikilidih

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Abstract

The study looked at how the firm life cycle affected dividend payments to Nigerian manufacturing companies that are publicly traded. Firm life cycle was represented by the following stages: firm introduction (FINT), firm growth (FGRT), firm maturity (FMAT), firm shakeout (FSHK), and firm decline (FDEC), while dividend payout was represented by the dividend payout ratio (DPO). Data for the study were gathered from the annual reports and accounts of the listed manufacturing firms in Nigeria for the period ending in 2016–2022 using an Ex Post Facto design. The data analysis was done using a panel least squares model, and the results show that there is a significant and positive relationship between firm maturity stage and dividend payout of manufacturing firms in Nigeria at a level of significance of 5%, but not between firm introductory stage, firm growth stage, firm shakeout stage, or firm decline stage. The study comes to the conclusion that, in contrast to other firms, the maturity life cycle stage determines the dividend payout of listed manufacturing firms in Nigeria. As a result, the dividend payout of manufacturing firms in Nigeria is significantly influenced by the firm's maturity life cycle stage. The study suggests that managers should concentrate on board oversight and financial management appropriately, particularly during the maturity stage, to prevent slipping into the following stage, which is the restructuring stage or decline stage.

keywords:

Firm Life Cycle, Dividend Payout, Firm Introductory Stage, Firm Growth Stage

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References:

Abu S.T. (2012). Determinants of Dividend payout policy: Evidence from Bangladesh.
International journal of Economic Practices and Theories.



Abubakar , A. &Ozemoya, A. O.(2021).Assessment of life cycle theory on the propensity to pay
dividend of listed manufacturing firms in Nigeria. Journal of Accounting and Finance
Research 2(2) 162-174

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