ASSETS COMPOSITION AND FINANCIAL PERFORMANCE OF CONSUMER GOODS FIRMS IN NIGERIA

ABSTRACT

The study examined assets composition and financial performance of consumer goods firms in Nigeria. The study adopted panel research design and employed secondary data from 2017 to 2021 on the research variables sourced from the annual reports of twenty-one consumer goods industries listed on the floor of the Nigerian Exchange Group. Census sampling was employed. Hence, the study sampled all the twenty-one consumer goods industries listed on the Nigeria Exchange Group. The pooled ordinary least square regression was employed as the method of data analysis in the study. The findings revealed that non-current assets has no significant effect on financial performance of listed Consumer Goods industries in Nigeria. Current assets has significant effect on financial performance of listed Consumer Goods industries in Nigeria. Finally, working capital has significant effect on financial performance of listed Consumer Goods industries in Nigeria. The study recommends that the management of consumer goods firms should carefully consider the levels of their non-current assets investments, as they may not make any meaningful contribution to financial performance. Firms should increase their current 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. Finally, the management of Consumer goods industries in Nigeria should ensure that it takes into consideration the quality of working capital in order to ensure they contribute positively to the productivity of the firm, so as to enhance the overall profitability of the firm.