Assets utilization and financial performance of pharmaceutical companies in Nigeria (A case study of Fidson Healthcare Plc)

Abstract

The purpose of this study was to look into how asset utilization affects the financial performance of pharmaceutical companies (as measured by return on asset) in Nigeria, with a particular focus on Fidson Healthcare Plc, between 2011 and 2020 fiscal years. Two specific objectives, research questions, and hypotheses were developed for this study. The ex-post facto research design was used with secondary data derived from the pooled data collected from the annual financial reports of FIDSON healthcare. The collected data were analyzed using ordinary least square regression analysis, but the study also performed preliminary analyses such as
descriptive statistics and correlation analysis. According to the study, variations in the asset utilization variables captured in the model explain approximately 32.7% of the total variation in ROA as explained by variations in the independent variables captured in the study. Furthermore, both current asst ratio and the non-current ratio were found to be positively and significantly related to profitability of Fidson Healthcare Plc in Nigeria. Therefore, the study recommended that, in Nigerian manufacturing enterprises, special emphasis be devoted to maximising asset use. Also, financial ratios should be computed and used by Nigerian companies to monitor their financial performance on a regular basis.