Determinants of Financial Distress Among Listed Nigerian Companies: Evidence from the Post-Pandemic Period

This study identifies the determinants of financial distress among companies listed on the Nigerian Exchange Group during the post-pandemic period from 2021 to 2023. The COVID-19 pandemic severely disrupted economic activity in Nigeria, accelerating financial stress across multiple sectors including aviation, hospitality, retail, and manufacturing. Understanding the accounting and financial indicators that predict corporate distress is critical for investors, regulators, and management teams seeking to prevent insolvency. This study uses a quantitative research design, applying the Altman Z-score model and logistic regression analysis to financial data from 25 listed companies classified as financially distressed and 25 control firms. Predictor variables include liquidity ratios, profitability ratios, leverage ratios, asset efficiency measures, and market value indicators. Results indicate that leverage, liquidity, and earnings volatility are the strongest predictors of financial distress in the Nigerian post-pandemic context. Market-based indicators added incremental predictive power beyond accounting ratios alone. The study concludes that multi-dimensional financial distress models incorporating both accounting and market variables provide superior early warning capability for Nigerian listed companies. It recommends that the Securities and Exchange Commission and the Nigerian Exchange Group establish a systematic financial distress monitoring framework using quarterly ratio analysis to identify at-risk companies before insolvency becomes inevitable.

Keywords: financial distress, Altman Z-score, post-pandemic, Nigerian Exchange Group, insolvency prediction.