Download or read book The Effects of Working Capital Management on Mining Firm s Profitability Empirical Evidence from an Emerging Market written by Mutlu Başaran Öztürk and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Working capital management decisions are the most important among the financial decisions in terms of companies. Working capital expresses financing and management of the short-term investment; in other words, profitability and liquidity are among the main factors affecting the objectives of the companies. The management of working capital components in emerging markets such as Turkey, where financial markets have inadequate depth and financial product diversity, with insufficient saving volume and capital accumulation, is an important topic. In this chapter, we examine the relationship between the components of working capital and profitability; a sample consisting of Istanbul Stock Exchange (ISE) listed mining firms for the period of 2009Q4-2015Q3 that has been analyzed under a panel data analysis. The main reason for choosing the mining sector is because it is the most strategic sector in developing countries. As a result, empirical findings of the study show that growth (firm growth in sales) and INVP (inventory period) affect ROA (return on assets), which represent firm profitability positively, while size (firm size) affects firm profitability negatively. On the other hand, the other independent variables included in the regression model LEV (leverage), CCC (cash conversion cycle), and ACRP (accounts receivables period) have no statistically significant effects on firm profitability for mining sector in Turkey.

Download or read book Financial Management from an Emerging Market Perspective written by Soner Gokten and published by BoD – Books on Demand. This book was released on 2018-01-17 with total page 334 pages. Available in PDF, EPUB and Kindle. Book excerpt: One of the main reasons to name this book as Financial Management from an Emerging Market Perspective is to show the main differences of financial theory and practice in emerging markets other than the developed ones. Our many years of learning, teaching, and consulting experience have taught us that the theory of finance differs in developed and emerging markets. It is a well-known fact that emerging markets do not always share the same financial management problems with the developed ones. This book intends to show these differences, which could be traced to several characteristics unique to emerging markets, and these unique characteristics could generate a different view of finance theory in a different manner. As a consequence, different financial decisions, arrangements, institutions, and practices may evolve in emerging markets over time. The purpose of this book is to provide practitioners and academicians with a working knowledge of the different financial management applications and their use in an emerging market setting. Six main topics regarding the financial management applications in emerging markets are covered, and the context of these topics are "Capital Structure," "Market Efficiency and Market Models," "Merger and Acquisitions and Corporate Governance," "Working Capital Management," "Financial Economics and Digital Currency," and "Real Estate and Health Finance."

Download or read book Effects of Working Capital Management on SME Profitability written by Pedro Martínez-Solano and published by . This book was released on 2007 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt: The objective of the research presented here is to provide empirical evidence about the effects of working capital management on the profitability of a sample of small and medium-sized Spanish firms. With this in mind, we collected a panel of 8,872 SMEs covering the period 1996-2002. The results, which are robust to the presence of endogeneity, demonstrate that managers can create value by reducing their firm's number of days accounts receivable and inventories. Equally, shortening the cash conversion cycle also improves the firm's profitability.

Download or read book The Impact of Working Capital Management on the Profitability of a Manufacturing Company written by Jones Jalis and published by . This book was released on 2021-01-21 with total page 60 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Effects of Working Capital Management on Profitability written by Shaskia Soekhoe and published by LAP Lambert Academic Publishing. This book was released on 2012 with total page 84 pages. Available in PDF, EPUB and Kindle. Book excerpt: Is Working Capital Management carried out in the same manner in all countries? How is Working Capital managed in the Netherlands? Does each industry differ in the way Working Capital is managed? The Effects of Working Capital Management on the Profitability of Dutch Listed Firms is a book in which research is conducted in the Netherlands with regards to these questions. This book also includes findings of other researchers in different countries.

Download or read book Working Capital Management and Corporate Profitability written by Sarathadevi Anandasayanan and published by . This book was released on 2014 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt: The working capital management plays an important role for the success or failure of firm in business because of its effect on firm's profitability as well on liquidity. An optimal working capital management is expected to contribute positively to the creation of firm value. To reach optimal working capital management firm's manager should control the trade-off between profitability and liquidity accurately. The study aimed to provide empirical evidence about the effects of working capital management on profitability for a panel made up of a sample of eighty Sri Lankan listed firms for the period 2003 to 2009.The study utilized panel data econometrics in a pooled regression, where time series and cross sectional observations were combined and estimated. The study is based on secondary data collected from 80 listed firms in Sri Lanka stock market. The study found a significant negative relationship between net operating profitability and the average collection period, inventory turnover in days and average cash conversion cycle. These results suggest that managers can create value for their shareholders if the firms manage their working capital in more efficient ways by reducing the number of days accounts receivable and inventories to a reasonable minimum.

Download or read book Impact of Working Capital Management on Profitability written by rafathunnisa Syeda and published by . This book was released on 2018 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The success of any business depends on its profitability, liquidity, and solvency. Liquidity plays an important role in the successful running of a business. Many prior studies have been conducted to measure the relationship between working capital and profitability. The results showed that the high investment in inventories and receivables is associated with lower financial performance. They found a negative relationship between Return on Assets and Inventory turnover and Cash conversion cycle the present study is designed to know the direct impact of working capital on profitability by choosing the days of collection, days of payment, days inventory converts to sales and finally the cash conversion cycle. This study examines the association between the profitability and working capital using the data of 15 US trading companies for the period of 2015 to 2019. The key points in this study are firstly there exists a negative relationship between the profitability and the average collection period, the lower the average collection period higher will be the profitability, indicating that a decrease in the number of days a firm receives payment from sales affects the profitability of the firm positively. Secondly there is a highly significant positive relationship between average payment period and profitability. This implies that the longer a firm makes the payment to its creditors, the more profitable it is. Thirdly the cash conversion cycle decreases it will lead to an increase in profitability of the firm, and managers can create a positive value for the shareholders which indicates that it has been maintained. The regression analysis showed the value for the R-squared in the model is 0.584, i.e., 58.4% of the variation in the dependent variable Net Profitability is explained by the independent variables.

Download or read book Emergence Performance and World Market Impact of State Mining Companies in Developing Countries written by István Dobozi and published by . This book was released on 1987 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Working Capital Management and Firm Performance in Emerging Economies written by Shikha Bhatia and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This article aims to investigate the relationship between working capital management and firm performance in an emerging market. The analysis is done over a long window spanning across 2000-2014 by using ordinary least square (OLS), fixed- and random-effects model and generalized method of moments (GMM) on 2,327 firm-year observations, a panel data of 179 companies listed on the S&P BSE 500 Index of Bombay Stock Exchange (BSE). For robustness, in addition to accounting performance, market-based performance measure has also been employed to measure firm performance. This study based on India finds a negative relationship between the working capital management and firm performance, necessitating the need to efficiently manage the working capital for enhanced profitability.

Download or read book Working Capital Management and Financing Decision written by Solabomi Omobola Ajibolade and published by . This book was released on 2013 with total page 19 pages. Available in PDF, EPUB and Kindle. Book excerpt: Persuaded by the pecking order assumptions, where internal fund is preferred over debt and equity when financing investment projects, this study provided empirical evidence on the interaction between working capital management and corporate debt structure, and the effect of this on corporate profitability. The assumption on which the study was based is that, if internal funds become the preferred source of finance for investment projects, then working capital composition is interfered, making both decisions co-dependent. A pool of time-series and cross-sectional dataset was constructed from the annual audited financial results of 35 manufacturing companies listed on the Nigerian stock exchange for a two-year period (2011-2012). Panel exploration and Factorial-ANOVA estimation techniques were used to estimate the econometric models developed for the study. The results suggested a significant negative relationship between firm's working capital composition and their debt structure choice. Additionally, on individual basis, the study found a positive significant relationship between debt structure and profitability but no significant relationship between firm's working capital composition and profitability. The results, however, showed that as the firm's working capital composition synchronously interacts with the debt structure, corporate profitability is positively affected. The study therefore recommends that, for firms to optimize profitability and to maintain good liquidity position, corporate financing decision should be considered side by side with their working capital composition.

Download or read book The Effects of Working Capital Management on Firm Performance Evidence from Chinese Listed Firms written by and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This thesis empirically examines the relationship between working capital management measured by cash conversion cycle and firm profitability for a sample of non-financial Chinese listed firms. The sample used includes 949 firms for a period of 9 years from 2006 to 2014. Through using a fixed-effects regression analysis strong support is derived concluding a significant negative relation between a firm's cash conversion cycle and its profitability (measured by net operating income as well as return on assets). In addition, a significant negative relationship is observed between days sales outstanding and profitability. The same results were obtained when state- and private-controlled firms were investigated separately. However, unexpectedly no differences between the two groups could be determined. Overall the results indicate that managers in China can enhance profitability of their companies by handling days sales outstanding and the cash conversion cycle efficiently.

Download or read book Effect of Working Capital Management Policy on Firms Profitability written by Nuru Mohammed and published by . This book was released on 2012 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Effects of Working Capital Management and Profitability written by Gamlath G.R.M. and published by . This book was released on 2014 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt: Decisions relating to working capital and short term financing are referred to as working capital management (W. These involve managing the relationship between a firm's short-term assets and its short-term liabilities. The objective of working capital management is to ensure that the firm is able to continue its operations and that it has sufficient cash flow to satisfy both maturing short-term debt and upcoming operational expenses. Working capital management is one of the essential determinants of firms' market value because it directly affects the profitability. This study investigates the relationship between working capital management and profitability of Colombo Stock Exchange (CSE) listed commercial banks in Sri Lanka. The objective of the study is to identify the relationship between the working capital management and profitability and its impact on profitability. The relation between the working capital management and profitability is examined using Pearson correlation analyses and the effects on profitability is found out using the regression analyses by using a sample of 07 annual financial statements covering period 2007-2011 of listed commercial Banks in Sri Lanka. The working capital management represents the variables of the current ratio (CR), loans to deposit ratio (LDR) and cash ratio (CSR) and the profitability including the net profit margin (NPM), return on equity (ROA) and return on capital employed (ROCE)). The conclusion of the study is that The CSR has great impact on NPM and ROA than other components which are influenced by other factors such as savings, interest rates other than CR and LDR. Working capital management has a great impact on the profitability of the Sri Lankan listed commercial banks and the value of the managers of commercial banks will have to increase value of the firm thereby controlling the level of optimal working capital position.

Download or read book Enhancing Shareholder Value Through Efficient Working Capital Management written by Palanisamy Saravanan and published by . This book was released on 2020 with total page 2 pages. Available in PDF, EPUB and Kindle. Book excerpt: Working capital management is important owing to its effects on the firm's profitability, liquidity and more importantly on its value. In the current study, we investigated the link between efficiency of working capital management and value of the firm in the Indian context during the period 2004 to 2015. We deployed accounting as well as market based metrics to decipher the relationship between firm value and cash conversion cycle. Using panel data regression model, we found that shorter cash conversion cycle leads to higher firm value; further, we observed a non-linear relationship between cash conversion cycle and firm value indicating optimal level of investment in working capital enhances shareholders' value. Majority of the independent variables including control variables in the model are found to be highly significant. Further, our results are robust and are in consonance with the theory and have far reaching implications for the corporate finance managers, prospective investors, lenders, suppliers, government and regulatory authorities.

Download or read book Bi Directional Causality Between Working Capital Management and Profitability written by Showkat Busru and published by . This book was released on 2017 with total page 14 pages. Available in PDF, EPUB and Kindle. Book excerpt: Management of short term funds and their disbursement plays a vital role in deciding fate of entity's financial soundness and future prospect. Thus efficient working capital management is prerequisite for business success so has not only remained orbit of many theoretical and empirical studies but also great concern for management and academic experts. Empirical literature in Indian context on this topic not only presents ambiguous results, but is centered mainly on the possible impact efficient working capital management levels on profitability of the companies, disregarding the possibility of reverse causality running from profitability to effective liquidity and working capital management efficiency, except few recent studies from developed nations. Olarewaju M.O & Adeyemi K.O (2013); Awad, I & Jayyar F (2013). Current study is an attempt to shed light on bidirectional causal relationship between working capital management components like liquidity and cash conversion cycle proxies efficiency of the management in formulating and executing growth and sustainability oriented policies and profitability in the Indian listed firms for the period last one decade through use of econometric model of granger causality and other related methods according to need of study. The results failed to support theoretical assumption and strengthened the prior works and revealed that there is no causal relationship but while taking lag of one year results favored the casual relationship between efficiency liquidity and profitability. The study addressing the current issues may frame consciousness among managers and academicians and help to rule out myths and touch the modern horizons of managing daily financial requirements.

Download or read book Impact of Working Capital Management on Profitability A Case Study of ACC Ltd written by CMA(Dr.) Ashok Panigrahi and published by . This book was released on 2013 with total page 9 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study empirically examines the relationship between working capital management and profitability of ACC Cement Company, the leading cement manufacturer of the country for assessing the impact of working capital management on profitability during the period 1999-2000 to 2009-10. The impact of working capital management on profitability is analyzed by computing Pearson's simple correlation coefficients, multiple correlation analysis and multiple regression analysis between Operating Profit and the selected independent variables affecting the working capital. The 't' test has been used to judge whether the computed correlation and regression coefficients are significant or not. Few variables show a strong and positive correlation with the profit whereas some others do not have. Hence, the result concludes that there is a moderate relationship between working capital management and firm's profitability. It can be said that there exists a relationship between the efficiency of working capital and the profitability, but the relationship is not statistically significant.

Download or read book The Impact of Working Capital Management on the Profitability of Financial Listed Firms in Palestine written by Hasan Abdul-Hadi and published by . This book was released on 2018 with total page 13 pages. Available in PDF, EPUB and Kindle. Book excerpt: The working capital management plays an important role for success or failure of firm in business because of its effect on firm's profitability. This study aims at providing an idea about the directional effect of working capital management on profitability of financial listed firms in Palestine. The contemplated research will analyze Palestinian listed companies with respect to the optimal mix of their working capital structure as it relates to profitability. This is presently considered an understudied area and will have positive benefit for both professionals and academics. The contemplated research will provide a basis for further research and examination of the domain of working capital structure. Firm Size and firm Growth has a positive impact on the firm's profitability. It is important to focus on the nexus of working capital structure theory, managerial decision-making theory and managerial communication theory to have effective working capital management framework.