Assets Management and Financial Performance of Listed Consumer Goods Manufacturing Companies in Nigeria

Abstract

The increasing shift in asset composition toward intangible components coinciding with a substantial decline in asset tangibility of companies across the globe has escalated extensive discourse among researchers in the developed economies. The aim of this study is to evaluate the effect of assets management on financial performance of the Nigeria’s consumer goods manufacturing company. The specific objectives of this study were to evaluate the effect of assets turnover ratio, assets tangibility ratio, intellectual assets ratio on return on assets of the selected consumer goods manufacturing companies in Nigeria. The study adopted an ex-post facto design. Data were generated from the audited financial reports of the seven selected listed consumer goods manufacturing company from 2012-2022. Panel multiple regression technique was employed to analyze the data using Stata 14.2. The study found that assets turnover ratio and assets tangibility have significant positive and negative effect on return on assets with t-statistics and (p-values) 2.04 (0.045) and -3.20 (0.013) respectively whereas intellectual assets ratio exerted a non-significant positive effect on return on assets with t-statistics and (p-values) 1.29 (0.232). These results imply that the shiftability concern is negligible in the listed consumer goods manufacturing companies in Nigeria. However, the proportion of tangible assets seems to have over-stretched beyond the optimal level, thereby impacting negatively on their financial performance.