FINANCIAL PERFORMANCE INDICATORS AND PROFITABILITY: A STUDY OF NIGERIAN CONSUMER GOODS FIRMS

Abstract

This study used panel data approach to investigate the impact of current on profitability of consumer goods manufacturing firms listed on the Nigeria Exchange Group. It specifically examined the effect of Current Ratio on Return on Assets (ROA) and Return on Equity (ROE). The research was anchored on the Liquidity Preference Theory, proposed by Keynes in 1930, which suggests that investors prefer cash or other highly liquid holdings. A quantitative, longitudinal research design was adopted. Purposive sampling techniques was employed to select Nestlé Nigeria Plc, Dangote Sugar Plc, Bua Foods PLC, and Unilever Plc as samples used for the study. Data were collected from 2016 to 2023 and were analyzed using descriptive statistics correlation and regression analysis, with the aid of Eviews analytical software. The findings indicate that the Current Ratio positively influences ROE. The study recommends that firms prioritize maintaining a strong Current Ratio