Capital Structure and Financial Performance of Manufacturing Firms in the United Kingdom
Abstract
This research examined the correlation between Capital Structure and Financial Performance of Manufacturing Firms in the United Kingdom using a quantitative methodology from 2013 to 2022. The study's data was obtained from secondary sources, specifically Bloomberg and EIKON. The dataset comprising 10 manufacturing enterprises from the United Kingdom was analyzed utilizing descriptive statistics and regression analysis with SPSS. The findings demonstrated that Equity Share exhibited a positive association with return on assets. The study indicated that a company's short-term debt positively and significantly correlates with return on assets, whereas long-term debt adversely affects return on assets. The outcome also indicates a correlation between company size and profitability. This suggests that larger enterprises may own greater equity and enhanced access to markets and other economies of scale. This study concluded that the relationship between stock shares and return on assets is highly positive, whereas short-term and long-term debts have a small negative impact on return on assets. This report recommends that the UK government should promote the functionality of the bond market to enhance its operations, hence providing enterprises with additional financing alternatives. This will progressively diminish administrative interference in the bond market and afford it greater capacity for expansion; additionally, the government should allow increased participation of private funds in the capital market, as this will facilitate its development and offer firms a novel means of financing.
How to Cite This Article
Samson Ehada, Abubakar Sadiq Yayangida, Deborah Enwayi Musa (2025). Capital Structure and Financial Performance of Manufacturing Firms in the United Kingdom . International Journal of Multidisciplinary Research and Growth Evaluation (IJMRGE), 6(5), 64-69.