Firm Characteristics and Profitability in Nigerian Consumer Goods Firms: Assessing the Moderating Role of Firm Size
This study examines the impact of firm characteristics on the profitability of listed consumer goods companies in Nigeria. The specific objectives are to assess the influence of firm characteristics (liquidity, leverage, and age) on the profitability of these companies in Nigeria, and to explore the moderating effect of firm size on the relationship between firm characteristics and profitability. The ex post facto research design was implemented for this study. The data were collected from secondary sources, particularly the audited financial reports of 16 consumer goods companies listed on the Nigerian Exchange Group as of December 31, 2022, spanning a decade (2013-2022) using purposive sampling techniques. The Descriptive and inferential statistics were employed to analyze the data. The Panel regression analysis was conducted for hypothesis testing, and pre-estimation and post-estimation procedures were executed. The Hausman test confirmed that the random effect model was appropriate. The findings indicate that liquidity has a negative and significant impact on profitability, while leverage and firm age exhibit positive but insignificant effects. The moderating effect of firm size on the relationship between firm characteristics and profitability reveals that liquidity significantly affects profitability. Conversely, leverage and firm age have adverse and insignificant effects.
