Impact of Dividend Policy on Financial Performance of Listed Food and Beverages Companies in Nigeria
The study investigated the influence of dividend policy on the financial performance of publicly traded food and beverage companies in Nigeria. The study utilised an ex-post facto research design and collected data from the annual reports and accounts of the selected organisations during a nine-year period (2010-2018). Through multiple regression analysis, it was discovered that there is a positive and statistically significant relationship between dividend policy and returns on assets for food and beverage companies listed in Nigeria. The dividend policy ratio has a significant impact on the asset returns of food and beverage firms that are listed in Nigeria. The investigation revealed that the dividend per share had a negative and statistically insignificant effect on the returns on assets of food and beverage companies listed in Nigeria. The study suggests that corporations should prioritise the interests of shareholders when developing dividend policies. This can be achieved by distributing a significant portion of their earnings as dividends, which helps to address the agency problem and ensure that shareholders receive their fair share. Food and Beverage companies in Nigeria should enhance their dividend policy, as it serves as a metric for investors to gauge the returns on their stock investments, either through cash dividends or improvements in asset value due to stock appreciation. Nigeria’s food and beverage companies should carefully evaluate adopting a dividend policy, considering the company’s specific conditions. It is important to avoid relying solely on traditional considerations that academics have traditionally developed.
Keywords: Dividend Policy, Financial Performance and Food and Beverage Company
