DIVIDEND POLICY ON FINANCIAL PERFORMANCE OF LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA

Abstract

Firms have faced various challenges in maintaining optimal financial performance. One of the key
concerns for investors is dividend policy, which shapes the views of different stakeholders regarding a
company’s profitability. Ongoing debates on this topic have raised questions about how dividend policy
influences the financial performance of businesses. This study explored the relationship between dividend
per share, dividend payout, and financial performance in the Nigerian industrial goods sector. The
research follows an ex post facto design, focusing on twelve years from 2012 to 2023. The study targets a
population of 13 listed industrial goods companies, selecting a sample of 10 firms to provide a
representative overview of the sector. Dividend per share and dividend payout ratios are used as proxies
to measure dividend policy, while return on assets serves as the measure for financial performance, with
revenue included as a control variable. The findings indicated that dividend per share and dividend payout
ratio had no statistically significant effect on the return on assets of the sampled firms. The study concludes
that these dividend policies do not significantly impact the financial performance of the companies
studied. The study recommended raising dividend payout ratios and offering training to appropriate
personnel to improve the administration and management of dividend policies