The effect of working capital market management on firms profitability in Malaysia (construction public listed companies)

This thesis examines the relationship between working capital management and profitability of construction firms in Malaysia for a period between 2012 and 2020. Study done due to working capital management has a critical role in the profitability of the firms. The research is investigating on the relationships between the four components of working capital management, namely, receivable, payable conversion period, inventory conversion period and cash conversion cycle of Malaysian Construction public listed companies. There is a significant impact for the sales growth, firm size and financial leverage on the profitability of firms as well. The study collected the financial historical data from the Blomberg Terminal. To run the analysis, the one hundred top public-listed companies mainly from the Main in Board of Bursa Malaysia were selected as a sample based on market capitalization. The analysis done using SPSS
included the relationship between independent variables which is growth of public listed companies and dependent variable consist of receivable, payable, conversion period, inventory conversion period, and cash conversion cycle. Finally, study reveals that there are positive relationships between all the independent variables with firm growth, but only cash conversion cycle has a significant relationship. Result showed that businesses should efficiently concentrate and build a working capital management strategy to serve their shareholders in optimizing their resources. For future study, recommend to broaden
the scope of this analysis to include all sectors specified on Bursa Malaysia.