Despite efforts being made by relevant stakeholders to improve performance, most firms do not ensure optimal level of working capital and this has been a major obstacle to their overall profitability. Efforts were made by this study to examine the impact of working capital management on the profitability of conglomerate firms listed on the Nigerian Stock Exchange.
Data were collected from the annual reports of the six conglomerate firms listed on the Nigeria Stock Exchange for a period of 10 years (2006-2015); correlation research design was used, while ordinary least regression (OLS) was employed in data analysis. Using panel data methodology, the study found a significant positive relationship between cash conversion cycle and profitability; an insignificant negative relationship between debtor’s turnover ratio
and profitability; and an insignificant positive relationship between inventory turnover ratio and profitability. The study suggests that managers of conglomerate firms should give adequate attention to debtor’s and inventory turnover and try to maintain an optimal working capital levels.