Firm Attributes and Financial Performance of Listed Manufacturing Companies in Nigeria

Abstract

This study examines the relationship between firm attributes and financial performance of listed manufacturing companies in Nigeria. Financial performance is measured as a Return on assets. Using a fixed-effects regression model and a longitudinal research design, this study analyzes financial data of the manufacturing companies between 2015-2023, which allows for observing trends and firm-level variations over time. The research design was chosen to control for unobserved heterogeneity across firms, ensuring that the results reflect the true relationships between the variables rather than being influenced by individual firm characteristics. The findings of the study reveal that firm size has a significant positive effect on ROA, indicating that larger firms generally achieve higher profitability, likely due to broader market reach and operational efficiencies. Liquidity exhibits a positive and significant effect on ROA, suggesting that firms with sound liquidity are better positioned to handle liabilities and enhance returns. The study concludes that optimal firm size, prudent debt management, and efficient liquidity practices are essential for strengthening financial performance in Nigeria’s manufacturing sector. Recommendations of the study include strategic expansion, cautious debt use, and robust liquidity management to improve profitability and accounting resilience.