Abstract
This paper aims to examine the relationship between the length of receivable conversion period as a measure of credit policy and operating profit margin as a measure of operational performance of construction firms listed in the Saudi stock market This relation is examined using dynamic panel data two- steps robust system estimation for the period 2004-2013. The analysis is applied at the levels of the full sample and divisions of the sample by crisis and non-crisis periods, sector, and by size. The results show negative and significant relationship between receivable conversion period as a measure of credit policy and profitability for the full sample. The result of the relationship between receivable conversion period and profitability for small firms is negative and significant. The results also show negative and significant relationship between receivable conversion period and profitability of real estate companies and negative and insignificant relation for building and construction companies
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