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ABSTRACT
The primary purpose of this research study is to investigate the relationship between capital structure and profitability in Nigerian listed manufacturing firms. The explanatory variables are Total debt to total asset ratio (TDTA), Total debt to total equity ratio (TDTE), Short term debt to total assets ratio (STTA), and long term debt to total assets ratio (LTTA). As the dependent variable, return on equity is utilized as a proxy for Profitability. The descriptive statistical approach, post diagnostic tests, correlation analysis, and regression methods were utilized with Eviews 10.0 to analyze the data in order to satisfy the research goals and evaluate the hypotheses. This study discovered that capital structure had a substantial impact on profitability among the listed manufacturing firms studied. More specifically, the results show that Total debt to total asset ratio has a negative and significant effect on listed manufacturing firms profitability. The findings also show that total debt to total equity ratio, as well as long term debt to total assets ratio, has a positive and insignificant link with profitability in Nigerian listed manufacturing companies, while long term debt to total asset ratio has a negative and significant relationship with profitability. It is recommended that the top management of listed manufacturing firms implement policies to control the capital structure variables in listed manufacturing firms.. These policies must be developed in accordance with the norms and requirements of the Securities and Exchange Commission.
