Corporate Financial Management Strategies and Financial Performance of Selected Listed Manufacturing Firms in Nigeria

This study examined the joint effect of capital structure management and cash management strategies on the financial performance of listed manufacturing firms in Nigeria. Specifically, the study investigated the influence of total debt-to-equity ratio, long-term debt-to-total assets ratio, financial autonomy rate, cash and cash equivalents ratio, cash ratio, and operating cash ratio on return on assets (ROA). The study adopted an ex-post facto research design and utilized secondary data obtained from audited annual reports and financial statements of selected manufacturing firms listed on the Nigerian Exchange Group (NGX) covering the period 2014–2024. Panel regression analysis and the Panel Generalized Method of Moments (GMM) technique were employed to analyze the data.
The findings revealed that total debt-to-equity ratio and financial autonomy rate exerted negative and significant effects on return on assets, indicating that excessive reliance on debt financing and internally generated funds may constrain profitability due to financial costs and limited growth flexibility. In contrast, long-term debt-to-total assets ratio had a positive and significant influence on financial performance, suggesting that the strategic use of long-term financing supports operational expansion and enhances profitability. Furthermore, cash and cash equivalents ratio and operating cash ratio were found to have positive and significant effects on ROA, implying that efficient liquidity and cash flow management improve firms’ ability to generate returns. However, cash ratio exhibited a negative effect on financial performance, indicating that excessive idle cash holdings may reduce profitability.
The study concluded that both capital structure decisions and cash management practices are critical determinants of financial performance among manufacturing firms in Nigeria. It recommended that firms should adopt an optimal mix of financing sources and strengthen liquidity management strategies to enhance profitability and long-term sustainability.

Capital structure, cash management, liquidity management, operating cash flow, financial performance, return on assets, manufacturing firms.

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