Assessing the Impact of Retained Profit on Corporate Performance: Empirical Evidence from Niger Mills Company, Calabar-Nigeria

Abstract

This study examined the impact of retained profit on corporate performance of Niger Mills Company Ltd Calabar-Nigeria. The research evaluated the Importance of retained profits as an alternative source of financing the activities of a corporation. Data were collected from the annual report of Niger Mills Company Ltd. Calabar and the statistical model used for data analysis was Karl Pearson product moment correlation coefficient.Findings revealed that the future earnings capacity of Niger Mills Ltd. Calabar depends on its retained profit. It was also discovered that accumulated profit, retained in the business has the potential of boosting future earnings. It was therefore concluded that, corporate bodies should always retain profits in their business rather than distribute all of it to shareholders. To this end, it was recommended that corporate entities should always retained profit in their business if they have to achieve a competitive edge over their rivals. Also that policies should be instituted by corporate bodies whereby a high percentage of net profit is retained in the business.