The study assessed the effect of financial ratios on performance of Quoted Breweries firms in Nigeria. It made use of ex post facto research design. Data were gotten from secondary sources obtained from NSE fact books and annual reports accounts of the selected Breweries Companies. The population of the study consisted of thirteen 13 quoted Breweries firms listed on the Nigerian Stock Exchange as at 31st December, 2018. Four 4 of the quoted Breweries firms are selected to form the sample of the study for the period of nine 9 years 2010 – 2018 . The relevant data obtained were subjected to statistical analysis using Pearson correlation coefficient and regression analysis. The results of this study revealed that there is a significant relationship between current ratio and firm performance but negative effect. Debt equity ratio has a significant effect on return on asset of Nigerian Breweries. The result of the study concludes that Nigerian breweries companies are relatively using an optimal mix of debt to equity which is evident from the significant positive relationship of debt equity ratio with financial performance of the Nigerian Breweries. The researchers recommended that the management should employ all carefulness while financing with long term debt instruments endeavor to find out the best and optimal combination of long term debt and equity that will impact positively on the value of the firm. Agbata, Amaka Elizabeth | Osingor, Arinze Stanley | Ezeala, George "Effect of Financial Ratios on Firm Performance: Study of Selected Brewery Firms in Nigeria" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-5 , August 2021, URL: https://www.ijtsrd.com/papers/ijtsrd45177.pdf Paper URL: https://www.ijtsrd.com/management/accounting-and-finance/45177/effect-of-financial-ratios-on-firm-performance-study-of-selected-brewery-firms-in-nigeria/agbata-amaka-elizabeth
International Journal of Trend in Scientific Research and Development (IJTSRD)
Volume 5 Issue 5, July-August 2021 Available Online: www.ijtsrd.com e-ISSN: 2456 – 6470
@ IJTSRD | Unique Paper ID – IJTSRD45177 | Volume – 5 | Issue – 5 | Jul-Aug 2021
Page 1664
Effect of Financial Ratios on Firm Performance:
Study of Selected Brewery Firms in Nigeria
Agbata, Amaka Elizabeth PhD; Osingor, Arinze Stanley; Ezeala, George PhD
Department of Accountancy, Nnamdi Azikiwe Univeristy, Awka, Nigeria
ABSTRACT
The study assessed the effect of financial ratios on performance of
Quoted Breweries firms in Nigeria. It made use of ex-post facto
research design. Data were gotten from secondary sources obtained
from NSE fact books and annual reports/accounts of the selected
Breweries Companies. The population of the study consisted of
thirteen (13) quoted Breweries firms listed on the Nigerian Stock
Exchange as at 31st December, 2018. Four (4) of the quoted
Breweries firms are selected to form the sample of the study for the
period of nine (9) years (2010 – 2018). The relevant data obtained
were subjected to statistical analysis using Pearson correlation
coefficient and regression analysis. The results of this study revealed
that there is a significant relationship between current ratio and firm
performance but negative effect. Debt equity ratio has a significant
effect on return on asset of Nigerian Breweries. The result of the
study concludes that Nigerian breweries companies are relatively
using an optimal mix of debt to equity which is evident from the
significant positive relationship of debt-equity ratio with financial
performance of
the Nigerian Breweries. The researchers
recommended that the management should employ all carefulness
while financing with long term debt instruments; endeavor to find out
the best and optimal combination of long term debt and equity that
will impact positively on the value of the firm.
KEYWORDS: Financial Ratios, Firm Performance, Brewery Firms,
Debt Instrumen