ABSTRACT
Working capital management involves the management of the
most liquid resources of the firm which includes cash and cash equivalents,
inventories, trade debtors and other receivables. Most firms do not ensure
optimal level of working capital and this has been a major obstacle to their
overall profitability. The study examined the impact of working capital
management on the profitability of Pharmaceuticalfirms listed on the Nigerian
Stock Exchange market. Ex-post facto research design were used in a sample of 5
Pharmaceuticalfirms. Secondary data for a period of 10 years (2005-2014) were
tested, and Ordinary Least Squares (OLS) multiple regression was employed in
data analysiSs. The result revealed that working capital management (account
receivables, collection management, accounts payables management, inventory
management, cash conversion cycle management, operating cash flow management)
has a sign fIcant impact on the profitability of listed pharmaceutical firms in
Nigeria. It is therefore recommended among others that managers should focus on
reducing inventory days, collect receivable as soon as possible because it is
better to receive inflows sooner than later, and delay payment of creditors
in-order to invest the money in short-term securities which are profitable.
Also, the cash conversion cycle should be elongated to the extent that it
maximizes profit. Therefore, the researcher recommends that the managements of
Pharmaceuticalfirms should adopt the daily stock control policy in order to
have an optimal inventory level, which would reduce the cost of holding and
ordering and, as a result maximizes profitability in turn
ONYEJI, C (2021). Impact Of Working Capital Management On The Profitability Of Listed Pharmaceutical Firms In Nigeria. Mouau.afribary.org: Retrieved Oct 31, 2024, from https://repository.mouau.edu.ng/work/view/impact-of-working-capital-management-on-the-profitability-of-listed-pharmaceutical-firms-in-nigeria-7-2
CONFIDENCE, ONYEJI. "Impact Of Working Capital Management On The Profitability Of Listed Pharmaceutical Firms In Nigeria" Mouau.afribary.org. Mouau.afribary.org, 26 Nov. 2021, https://repository.mouau.edu.ng/work/view/impact-of-working-capital-management-on-the-profitability-of-listed-pharmaceutical-firms-in-nigeria-7-2. Accessed 31 Oct. 2024.
CONFIDENCE, ONYEJI. "Impact Of Working Capital Management On The Profitability Of Listed Pharmaceutical Firms In Nigeria". Mouau.afribary.org, Mouau.afribary.org, 26 Nov. 2021. Web. 31 Oct. 2024. < https://repository.mouau.edu.ng/work/view/impact-of-working-capital-management-on-the-profitability-of-listed-pharmaceutical-firms-in-nigeria-7-2 >.
CONFIDENCE, ONYEJI. "Impact Of Working Capital Management On The Profitability Of Listed Pharmaceutical Firms In Nigeria" Mouau.afribary.org (2021). Accessed 31 Oct. 2024. https://repository.mouau.edu.ng/work/view/impact-of-working-capital-management-on-the-profitability-of-listed-pharmaceutical-firms-in-nigeria-7-2