WORKING CAPITAL MANAGEMENT AND THE FINANCIAL PERFORMANCE OF OIL AND GAS COMPANIES IN NIGERIA
Eno Emmanuel Archibong , Emmanuel E. Daferighe , Fred Favour Chisom and Inyang John Augustina
Volume 12 Issue 3
Abstract
The study examined the influence of working capital management on the financial performance of oil and gas companies in Nigeria. Ex-post-facto research design was adopted for the study. Secondary data were employed through audited annual reports published on the Nigerian Exchange (NGX) Group and the fact books of the five (5) oil and gas companies selected for the purpose of the study. The data for the study were obtained for the period of fifteen years (2010 to 2024). Ordinary least square regression, with the aid of E-views 10, was used in analysing the data and testing the stated hypotheses. Account receivable ratio value showed a positive insignificant effect on Return on Assets (ROA) of the oil and gas companies under study. Current ratio value had a positive significant effect on Return on Assets (ROA) of the oil and gas companies under study. The study recommends that Oil and gas financial managers should improve on the utilization of their current ratio. This can be achieved through efficient management of current Assets and current liabilities in order to improve the liquidity of the oil and gas companies. Managers of firms should ensure efficient management of account receivables by putting in place good credit policies that will enhance return on Assets (ROA). Key Words: Working Capital Management, Account Receivable Ratio, Current Ratio, Return on Assets
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