EARNINGS PER SHARE AND FINANCIAL PERFORMANCE OF LISTED ICT FIRMS IN NIGERIA: A PANEL STUDY
Keywords:
Asset Efficiency, Financial Performance, Information and Communication Technology, Sales EffectivenessAbstract
The study examined the relationship between earnings per share and the
financial performance of listed information and communication technology in Nigeria: A Panel
Study. The specific objective was to ascertain the extent to which earnings per share relates to
the net profit margin, return on asset and the asset turnover of listed ICT firms in Nigeria. This
study utilised an ex-post facto research design. The study's population comprises all ICT firms
listed on the Nigerian Exchange Group as of the end of the 2023 financial year. The purposive
sampling technique was employed to select five (5) firms. Secondary data for this research
were obtained from the financial statements of the selected firms from 2014 to 2023.
Descriptive statistics, including mean and standard deviation, were used to analyse the data.
For hypothesis testing, inferential statistical analysis was conducted using the Pearson Product
Moment Correlation Analysis technique. The findings show that Earnings Per Share has a
negative but non-significant relationship with the net profit margin of listed ICT firms in
Nigeria (r = -0.161723; p-value = 0.2885); Earnings Per Share has a positive but non-significant
relationship with the return on assets of listed ICT firms in Nigeria (r = 0.255900; p-value =
0.0898); Earnings Per Share has a positive and significant relationship with the asset turnover
ratio of listed ICT firms in Nigeria (r = 0.486598; p-value = 0.0007).In conclusion, while EPS
positively influences Return on Assets and Asset Turnover Ratio, indicating improved asset
efficiency and sales effectiveness, its negative relationship with Net Profit Margin suggests
potential trade-offs between short-term earnings enhancement and long-term profitability. The
study recommends that the board of directors should prioritise strategies that enhance
operational efficiency rather than focusing solely on increasing EPS through financial
manoeuvres like share buybacks.
