IIARD International Institute of Academic Research and Development

WORLD JOURNAL OF FINANCE AND INVESTMENT RESEARCH (WJFIR )

E-ISSN 2550-7125
P-ISSN 2682-5902
VOL. 8 NO. 5 2024
DOI: 10.56201/wjfir.v8.no5.2024.pg1.15

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Asset Mix and Financial Performance of Quoted Industrial Firms in Nigeria

NGOIGO, Sughnen (M.Sc Student) & Prof. OSUJI, Casmir Chinemerem

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Abstract

The study analyzed the relationship between asset mix and financial performance of quoted industrial companies in Nigeria, for the period of 2013-2022 (10years). The specific objectives of the study is to examine the measures of asset mix [Current Asset Ratio (CART), Non-Current Asset Ratio (NCART), Intangible Asset Ratio (INTART) and Investments Asset Ratio (INVART)] in relation to financial performance proxied with return on asset (ROA). The study sampled 10 industrial firms listed in the Nigerian Exchange Group and the secondary data used for the analysis was sourced from the annual reports and accounts of the sampled 10 industrial firms listed in the Nigerian Exchange Group. A total number of four research questions and four hypotheses were stated. Descriptive statistics, panel unit root test, diagnostics test and the multiple regression analysis of the (E-VIEW 9.0) at 0.05 level of significant (95% confidential interval) was used as a basis of testing the hypotheses. The findings revealed that Non-Current Asset Ratio (NCART), Intangible Asset Ratio (INTART) and Investments Asset Ratio (INVART) have a significant effect on return on asset while Current Asset Ratio (CART) do not have significant effect on Return on Asset. The study concluded that asset mix has a significant effect on the financial performance of quoted industrial companies in Nigeria. The study therefore, recommends that firms should increase their current and intangible assets, but should keep it at an optimum level that will ensure that maturing short-term business obligations are met and at the same time avoid keeping excess idle funds. This is because such investments will result in a proportionate increase in their financial performance. Therefore, excessive liquidity should be avoided.

keywords:

Asset, Mix, Current, Fixed, Ratio, Financial and Performance

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