An Empirical Study of Factors that Influence The Profitability of South African Retail Firms Listed on the Johannesburg Stock Exchange

Ntomolane Lobisa Matsoma (), Ndonwabile Zimasa Mabandla () and Lenny Phulong Mamaro ()
Additional contact information
Ntomolane Lobisa Matsoma: University of South Africa
Ndonwabile Zimasa Mabandla: University of South Africa
Lenny Phulong Mamaro: University of South Africa

Acta Universitatis Danubius. OEconomica, 2022, issue 18(6), 356-369

Abstract: The aim of the study was to investigate empirical factors that influence the profitability of South African retail companies listed on the Johannesburg Stock Exchange (JSE). A positivism, quantitative and deductive research approach was employed to analyse data collected from the Iress database. The sample consisted of 20 JSE-listed retail firms whose information for the period 2011 to 2021 was considered. Retail firms contribute an estimated 3.5% to the gross domestic product (GDP) of the country, but are struggling to maintain their profitability due to limited financial resources. The fixed effect model revealed financial leverage, liquidity and growth to have been positive and to have significantly influenced profitability, whereas firm size and total debt to assets were found to be negative, and were also found to have significantly influenced profitability. The findings contribute to the existing literature and serve to inform future researchers about factors influencing profitability. However, the findings are limited to retail firms in South Africa, and therefore cannot be extended to other sectors of the economy. This suggests the value of conducting further studies in sectors other than retail. These results could be useful as a point of reference for future researchers, managers, and investors.

Keywords: Financial leverage; Liquidity; Total debt to assets; Profitability; JSE-listed firms (search for similar items in EconPapers)
Date: 2022
References: Add references at CitEc
Citations:

Downloads: (external link)
https://dj.univ-danubius.ro/index.php/AUDOE/article/view/2078/2386 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:dug:actaec:y:2022:i:6:p:356-369

Access Statistics for this article

More articles in Acta Universitatis Danubius. OEconomica from Danubius University of Galati Contact information at EDIRC.
Bibliographic data for series maintained by Daniela Robu ().