The relationship between dividend pay-out and firm performance: empirical evidence from listed manufacturing firms in sri lanka

Abstract

Manufacturing firms play a vital role in Sri Lankan economic development through generating gross domestic product. So that dividend payout is directly related with firm performance of the manufacturing firms. Therefore, studying the relationship between dividend payout and firm performance is very important. The purpose of this study is to investigate the relationship between dividend payout and firm performance in Sri Lankan manufacturing firms. Moreover, the study attempts to examine the significant differences among the selected manufacturing firms and also data has been gathered from financial statements of thirty listed manufacturing firms on Colombo stock exchange over the period from 2014 to 2020. This study consists of descriptive statistical analysis, correlation analysis and multiple regression analysis for achieving the objectives of this study. Descriptive statistical analysis is used to investigate the behavior of every variable and this analysis consists of mean, standard deviation, maximum value and minimum value of each manufacturing firm. Correlation analysis is used to identify the relationship between independent and dependent variables. The multiple regression analysis is applied to measure the influence of dividend pay-out on firm performance of Sri Lankan listed thirty manufacturing firms. Finally, ANOVA analysis is used to investigate the significant differences among the manufacturing firms.