scholarly journals Firm Profitability And The Administration Of Working Capital: Delving Into A Case Of The Cement Sector Of Pakistan

2021 ◽  
Vol 5 (2) ◽  
pp. 59-64
Author(s):  
Farhan Ullah ◽  
Farhan Ullah ◽  
Dr. Mustafa afeef
Keyword(s):  
Stock Exchange ◽  
Negative Influence ◽  
Cement Industry ◽  
Working Capital ◽  
Financial Reports ◽  
Explanatory Variables ◽  
Cash Conversion Cycle ◽  
Conversion Period ◽  
Inventory Turnover ◽  
Collection Period

This study endeavors to establish an association between the administration of working capital and firm returns in Pakistan’s cement sector. Ten companies listed in the cement industry of KSE 100 Index were taken from Pakistan Stock Exchange randomly. Financial data in secondary form was collected from the financial reports of cement firms of the country. The study employed return on assets as an explained variable and inventory turnover period in days, collection period in days, payment period, cash conversion cycle, sales in log, and liquidity ratios as explanatory variables while controlling for the influence offirm’s size and firm’s growth in terms of sales. It was found that the current ratio, log of sales, cash conversion cycle and inventory conversion period positively influenced the return of companies whereas size of the firm, collection period of receivables, payment period to creditors and the debt ratio of firms had a negative influence on it.

scholarly journals Working capital management and profitability: evidence from Indonesian manufacturing companies

2020 ◽  
Vol 3 (1) ◽  
pp. 36-46
Author(s):  
Irfan Aryawan ◽  
Astiwi Indriani
Keyword(s):  
Stock Exchange ◽  
Manufacturing Companies ◽  
Capital Management ◽  
Working Capital ◽  
Return On Assets ◽  
Working Capital Management ◽  
Cash Conversion Cycle ◽  
Conversion Period ◽  
Collection Period ◽  
The Relationship

The aims of this study is to analyze the relationship between working capital management and profitability (return on assets) as a dependent variable and cash conversion cycle (CCC), inventory conversion period (ICP), average collection period (ACP) and average payment period (APP) as independent variables with leverage, liquidity, and size as the controlling variables. The sample of this study are manufacturing companies in the Indonesian Stock Exchange 2013-2017. The analysis using OLS showed that the ACP has a negative and significant effect on ROA and the APP has a positive and significant effect on ROA, meanwhile CCC and ICP has a negative and insignificant effect on ROA.

scholarly journals Effects of Working Capital Management and Liquidity: Evidence from the Cement Industry of Bangladesh

1970 ◽  
Vol 6 (1) ◽  
pp. 37-47 ◽  
Author(s):  
Sayeda Tahmina Quayyum
Keyword(s):  
Stock Exchange ◽  
Cement Industry ◽  
The Other ◽  
Capital Management ◽  
Working Capital ◽  
Working Capital Management ◽  
Cash Conversion Cycle ◽  
Management Efficiency ◽  
Time Period ◽  
Inventory Turnover

This paper is an attempt to investigate the effects of working capital management efficiency as well as maintaining liquidity on the profitability of corporations. For this purpose, corporations enlisted with the cement industry of Dhaka Stock Exchange have been selected and the analysis covers a time period from year 2005 to 2009. The purpose of this paper is to establish a relationship which is statistically significant, the other purpose is to help explain the necessity of firms optimizing their level of working capital management and maintaining enough liquidity as it affects the profitability. The result of this study clearly shows significant level of relationship between the profitability indices and various liquidity indices as well as working capital components.KEY WORDS: Working capital management; Liquidity; Cement Industry; Cash Conversion Cycle; Inventory Turnover; Receivables Turnover; Payable Turnover.DOI: http://dx.doi.org/10.3329/jbt.v6i1.9993  Journal of Technology (Dhaka) Vol. 6(1), January-June, 2011 37-47

scholarly journals Working Capital Management dan Firm Profitability Perusahaan Sektor Manufaktur di Bursa Efek Indonesia dan Bursa Efek Filipina Periode 2014-2018

2020 ◽  
Vol 1 (1) ◽  
pp. 31-42
Author(s):  
Ricky Adiyanto ◽  
Werner Ria Murhadi ◽  
Liliana Inggrit Wijaya
Keyword(s):  
Stock Exchange ◽  
Linear Regression Method ◽  
Capital Management ◽  
Working Capital ◽  
Working Capital Management ◽  
Accounts Receivable ◽  
Cash Conversion Cycle ◽  
Accounts Payable ◽  
Conversion Period ◽  
Firm Profitability

This study aims to analyze the effect of working capital management on the profitability of companies in Indonesia and Philippines. This study uses secondary data from companies listed in Indonesia Stock Exchange and Philippines Stock Exchange in the 2014-2018 period.  The sample used in this study includes manufacturing sector companies listed in Indonesia Stock Exchange and Philippines Stock Exchange in that period. This research uses multiple linear regression method. Working capital is measured using cash conversion cycle, accounts receivable conversion period, inventories conversion period, and accounts payable deferral period. The results of the Indonesian sample show that the cash conversion cycle and its components, namely the accounts receivable conversion period, the inventories conversion period, and the accounts payable deferral period have a significant positive effect on firm profitability. For the Philippine sample, the result of the study show that the cash conversion cycle and its components does not have a significant effect on firm profitability. Keywords: cash conversion cycle, accounts receivable conversion period, inventories conversion period, accounts payable deferral period

scholarly journals The Relationship between Working Capital Management and Profitability of Bumiputera-Controlled Companies in Malaysia

2018 ◽  
Vol 2 (3) ◽  
pp. 24-34
Author(s):  
Fairuz Sofia Kaharuddin ◽  
Ahmad Rizal Mazlan
Keyword(s):  
Capital Management ◽  
Working Capital ◽  
Working Capital Management ◽  
Trade Off ◽  
Cash Conversion Cycle ◽  
Conversion Period ◽  
Panel Data Regression ◽  
Data Regression ◽  
Collection Period ◽  
The Relationship

This study investigated the relationship between working capital management and profitability of 94 listed Bumiputera-controlled companies in Malaysia for 2006 until 2012. The underlying theory is the trade-off theory of working capital and cash conversion cycle, and its components are used as measures for working capital management. Findings of the panel data regression reveal that inventory conversion period and receivable collection period are significantly negatively correlated to profitability. This suggests that the shorter the period, the higher the profitability of Bumiputera-controlled companies tends to be. However, the cash conversion cycle is significantly and positively correlated to profitability, suggesting that the longer the cash conversion period, the higher the profitability. The payable collection period is not significantly correlated to profitability. The findings of this study assert that in general, Bumiputera-controlled companies are relatively less efficient in its working capital management, as far as the comparison to previous related studies is concerned.

scholarly journals Impact of Working Capital Management on Profitability: A Case Study of Trading Companies

2021 ◽  
Author(s):  
Rafathunnisa Syeda
Keyword(s):  
Negative Relationship ◽  
Working Capital ◽  
Return On Assets ◽  
Cash Conversion Cycle ◽  
Key Points ◽  
High Investment ◽  
Inventory Turnover ◽  
Collection Period ◽  
The Relationship

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.

scholarly journals PENGARUH ANALISIS ELEMEN MODAL KERJA TERHADAP PROFITABILITAS ( ROI ) PADA PT. HANJAYA MANDALA SAMPOERNA , Tbk.

2018 ◽  
Vol 3 (01) ◽  
Author(s):  
Musianah Musianah ◽  
Jianto B. Amiranto
Keyword(s):  
Return On Investment ◽  
Stock Exchange ◽  
Secondary Data ◽  
Manufacturing Companies ◽  
Working Capital ◽  
Financial Reports ◽  
Accounts Receivable ◽  
Financial Factors ◽  
Operating Profit ◽  
Inventory Turnover

ABSTRACTThe Company was established with the aim to obtain operating profit. One way that can be done is to increase the profitability of the company. The company's profitability is influenced by a variety of financial factors which can be measured using financial ratios. The purpose of this study was to analyze the influence of the elements utuk rotation modes of work, namely perputran working capital, cash perputran receivable turnover and inventory turnover perusahanaan on profitability (Return On Investment) company. Population peneleitian is manufacturing companies listed in Indonesia Stock Exchange (BEI) is a renowned roko Company PT. HANJAYA MANDALA, Tbk. Samples used in this research are secondary data from reports keuanagan the period 2011 to 2015. The data obtained from the company's financial reports the official website of the Stock Exchange www.idx.co.id. And from the Indonesia Stock Exchange that are in UNIVERSITAS TUJUH BELAS AGUSTUS SURABAYA. Classical assumption test and multiple regression analyzes were performed using an SPSS version 22.0The results of this study indicate that the regression model is compliant with the study that there are no symptoms heteroskedastisitas, multikoliniearitas, and autocorrelation as well as the data used beristribusi normal. Regeresi multiple analysis results indicate that the F test, cash turnover , accounts receivable turnover, and inventory turnover significant effect on profitability (ROI). In test T cash turnover , receivables turnover and inventory turnover significant effect on profitability (ROI) Keywords: Cash Turnover , Accounts Receivable Turnover, Turnover supplies of , Profitability (ROI).

scholarly journals THE EFFECT OF WORKING CAPITAL ON FIRM PERFORMANCE

2018 ◽  
Vol 2 (2) ◽  
pp. 232-244
Author(s):  
Indah Wahyuni ◽  
Seto Sulaksono Adi Wibowo
Keyword(s):  
Firm Performance ◽  
Stock Exchange ◽  
Capital Good ◽  
Working Capital ◽  
Independent Variables ◽  
Cash Conversion Cycle ◽  
Good Working ◽  
Net Profit ◽  
Inventory Turnover ◽  
Positive Effect

This study aims to examine the effect of working capital on firm performance. To implement the operating activities, the company should be able to manage good working capital. Good working capital management can help to enhance the firm performance in the eyes of investors. In this research, working capital is measured using working capital turnover, inventory turnover, days of supply, and cash conversion cycle as independent variables, while firm performance is measured using net profit margin as the dependent variable. The sample of this research is a manufacturing company listed in Indonesia Stock Exchange (IDX) period 2014-2016. Samples were taken by using purposive sampling and meeting the sample criteria. The anaysis technique used in this research is multiple regression analysis by using t test. The results of the study found that working capital turnover, days of supply, and cash conversion cycle negatively affect the performance of the company. While the variable of inventory turnover shows that inventory turnover has a positive effect on firm performance.

scholarly journals THE EFFECTS OF WORKING CAPITAL MANAGEMENT ON THE PROFITABILITY OF NIGERIAN MANUFACTURING FIRMS

2013 ◽  
Vol 14 (3) ◽  
pp. 520-534 ◽  
Author(s):  
Omo Aregbeyen
Keyword(s):  
Stock Exchange ◽  
Manufacturing Firms ◽  
Capital Management ◽  
Working Capital ◽  
Return On Assets ◽  
Working Capital Management ◽  
Operating Income ◽  
Cash Conversion Cycle ◽  
Operating Profit ◽  
Inventory Turnover

The efficiency of working capital management (WCM) has implications for firms’profitability. This paper empirically investigates the effects of WCM on the profitability of a sample of 48 large manufacturing firms quoted on the Nigerian Stock Exchange (NSE) for the period 1993 to 2005. It is aimed at filling the gaps in a previous study and contribute to expanding and enriching the literature particularly on Nigeria and at large. The analysis examined the responses of the firms’ profitability to WCM and a number of augmenting factors. Profitability was alternatively measured by gross operating profit (GOI), net operating income (NOI) and return on assets (ROA). Likewise, WCM was measured by the average collection period (ACP), average pay period (APP), inventory turnover days (ITID) and comprehensively by the cash conversion cycle (CCC). The results indicate that the firms’ have been inefficient with WCM and caused significant reductions in profitability. The paper concludes that improving the efficiency of WCM is essential and recommends that manufacturing firms in Nigeria should shorten the ACP, APP, ITID and reduce their CCCs.

scholarly journals The Relationship between Working Capital Management and Profitability: Evidence from Pakistan

2014 ◽  
Vol 20 ◽  
pp. 14-25 ◽  
Author(s):  
Nadeem Iqbal ◽  
Naveed Ahmad ◽  
Zeeshan Riaz
Keyword(s):  
Positive Relationship ◽  
Stock Exchange ◽  
Negative Relationship ◽  
Theoretical Research ◽  
Capital Management ◽  
Working Capital ◽  
Working Capital Management ◽  
Cash Conversion Cycle ◽  
Collection Period ◽  
The Relationship

In this paper secondary data is used for analysis of working capital on profitability. In this research paper we take working capital as independent variable and net operating profit as dependent variable. We have found a significant negative relationship between net operating profitability and the average collection period, inventory turnover in days, average payment period and cash conversion cycle for a sample of Pakistani firms listed on Karachi stock exchange. Previous theoretical research predicts negative relationship between cash conversion cycle and corporate profitability. The results of regression indicate that the coefficient of account receivable is negative; that is, the increase or decrease in average collection period wills significantly affect the profitability of the firm. According to inter-item correlation matrix the relationship of account receivables, account payables and inventory with profit shows positive relationship but cash conversion cycle, financial debt and financial assets shows negative relationship with profitability. Inventory shows the positive relationship with dependent variable which proves that working capital management has a positive effect on firm’s probability.

scholarly journals Does working capital management impact an enterprise’s profitability? Evidence from selected Nigerian firms

2021 ◽  
Vol 19 (1) ◽  
pp. 477-486
Author(s):  
Adegbola Olubukola Otekunrin ◽  
Tony Ikechukwu Nwanji ◽  
Gabriel Damilola Fagboro ◽  
Johnson Kolawole Olowookere ◽  
Oladipo Adenike
Keyword(s):  
Regression Analysis ◽  
Secondary Data ◽  
Capital Management ◽  
Working Capital ◽  
Working Capital Management ◽  
Cash Conversion Cycle ◽  
Descriptive Research ◽  
Inventory Turnover ◽  
Collection Period ◽  
The Impact

This study examined the impact of working capital management on the profitability of selected quoted agricultural and agro-allied companies (from 2012 to 2016) in Nigeria. Secondary data were extracted from eighteen quoted agricultural and agro-allied companies in Nigeria, four of which are agricultural companies out of the twenty-three in Nigeria. Descriptive research design and regression analysis were used. Working capital management was measured using the trade receivables collection period, trade payables, payment period, inventory turnover period, and cash conversion cycle, while profit before interest and tax measured profitability. This study found that working capital management and profitability are related to the agriculture and agro-allied sector in Nigeria. The result shows the trade receivables collection period and profitability are negatively related. The result also shows the trade payables payment period and profitability are positively related. The result shows that the inventory turnover period and profitability are related, the cash conversion cycle and profitability are positively related. The conclusion is that working capital management and profitability are related. If the management of firms takes efficient and effective decisions in managing the company’s working capital, all things being equal, the maximization of the firm’s profitability, value, and shareholders’ wealth can be guaranteed. Consequently, agency costs asserted by agency theory would be eliminated automatically. AcknowledgmentAll researchers and non-researchers that contributed to this paper are highly appreciated.

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