Capital Structure Decisions and Financial Performance of Listed Consumer Goods Companies on the Nigerian Exchange Group

This study examined the relationship between capital structure decisions and the financial performance of listed consumer goods companies on the Nigerian Exchange Group. Capital structure, referring to the mix of debt and equity financing adopted by firms, is a central topic in corporate finance with significant implications for firm value, risk, and profitability. For Business Education research, understanding capital structure in the context of Nigerian listed companies provides empirically grounded content for advanced financial management instruction. Grounded in the Trade-Off Theory and the Pecking Order Theory of capital structure, an ex-post-facto research design was adopted. The population comprised all 21 consumer goods companies listed on the NGX between 2018 and 2023. Secondary data extracted from audited annual reports and NGX financial data portal were used. Panel data regression analysis using fixed and random effects models was employed. Findings reveal that the debt-equity ratio has a significant negative relationship with Return on Assets but a non-significant relationship with Tobin Q, suggesting that high leverage adversely affects short-term profitability without necessarily eroding market value. Firm size and asset tangibility were significant control variables. The study fills a gap in empirical capital structure research for the Nigerian consumer goods sector and recommends that financial managers in listed consumer goods firms maintain moderate leverage ratios while optimizing equity financing for long-term capital investment. Keywords: capital structure, financial performance, Nigerian Exchange Group, consumer goods sector, Trade-Off Theory