DIVIDEND POLICY AND FIRM PERFORMANCE A STUDY OF LISTED FIRMS IN NIGERIA
Accounting and Management Information Systems
Vol. 11, No. 3, pp. 442–454, 2012
DIVIDEND POLICY AND FIRM PERFORMANCE:
A STUDY OF LISTED FIRMS IN NIGERIA
Uwalomwa UWUIGBE1
Covenant University, Ogun State, Nigeria
Jimoh JAFARU
Auchi Polytechnic, Edo State, Nigeria
Anijesushola AJAYI
Covenant University, Ogun State, Nigeria
ABSTRACT
This study basically investigates the relationship between the financial performance and dividend payout among listed firms’ in Nigeria. It also looks at the relationship between ownership structure, size of firms and the dividend payouts. The annual reports for the period
2006-2010 were utilized as the main source of data collection for the
50 sampled firms. The regression analysis method was employed as a statistical technique for analysing the data collected. We find that there is a significant positive association between the performance of firms and the dividend payout of the sampled firms in Nigeria. The study also revealed that ownership structure and firm’s size has a significant impact of the dividend payout of firms too.
Financial performance, annual reports, firms, ownership structure, dividend policy, dividend payout, Nigeria
INTRODUCTION
The issue of dividend policy is a very important one in the current business environment. Dividend policy remains one of the most important financial policies not only from the viewpoint of the company, but also from that of the shareholders, the consumers, employees, regulatory bodies and the Government. For a company, it is a pivotal policy around which other financial policies rotate (Alii et al., 1993).
Dividend or profit allocation decision is one of the four decision areas in finance.
Dividend decisions are important because they determine what funds flow to investors and what funds are retained by the firm for investment (Ross et al.,
1
Correspondence address: Uwalomwa Uwuigbe, Department of Accounting, School of Business,
College of Development Studies, Covenant University, Ota, Ogun
Vol. 11, No. 3, pp. 442–454, 2012
DIVIDEND POLICY AND FIRM PERFORMANCE:
A STUDY OF LISTED FIRMS IN NIGERIA
Uwalomwa UWUIGBE1
Covenant University, Ogun State, Nigeria
Jimoh JAFARU
Auchi Polytechnic, Edo State, Nigeria
Anijesushola AJAYI
Covenant University, Ogun State, Nigeria
ABSTRACT
This study basically investigates the relationship between the financial performance and dividend payout among listed firms’ in Nigeria. It also looks at the relationship between ownership structure, size of firms and the dividend payouts. The annual reports for the period
2006-2010 were utilized as the main source of data collection for the
50 sampled firms. The regression analysis method was employed as a statistical technique for analysing the data collected. We find that there is a significant positive association between the performance of firms and the dividend payout of the sampled firms in Nigeria. The study also revealed that ownership structure and firm’s size has a significant impact of the dividend payout of firms too.
Financial performance, annual reports, firms, ownership structure, dividend policy, dividend payout, Nigeria
INTRODUCTION
The issue of dividend policy is a very important one in the current business environment. Dividend policy remains one of the most important financial policies not only from the viewpoint of the company, but also from that of the shareholders, the consumers, employees, regulatory bodies and the Government. For a company, it is a pivotal policy around which other financial policies rotate (Alii et al., 1993).
Dividend or profit allocation decision is one of the four decision areas in finance.
Dividend decisions are important because they determine what funds flow to investors and what funds are retained by the firm for investment (Ross et al.,
1
Correspondence address: Uwalomwa Uwuigbe, Department of Accounting, School of Business,
College of Development Studies, Covenant University, Ota, Ogun
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