Abstract:
The focus of this study is to find out the significant impact of determinants of the profitability
on financial performance of selected listed manufacturing companies and identify the
relationship among determinants of the profitability and financial performance of the
selected listed manufacturing companies in Colombo Stock Exchange (CSE) from the
financial year 2010/11 to 2014/15. Determine the right, suitable and proper capital structure
is the major task of the firms here capital structure includes two major things such as equity
and debt capital. Capital structure is vital in determining the return on equity (ROE).
Liquidity is also one of the major components in determining the profitability of any firms.
Liquidity much be needed for day to day financial transactions of the firms. Firms' growth is
also determining the firm's profitability. Descriptive, regression and correlation analysis
2 were performed in this study. Regression results revealed that there is significant (R = 0.754/
75.4%) impact of determinants such as capital structure, firms' growth and liquidity position
on the profitability of the selected listed manufacturing companies. Correlation results
confirmed that there is significant relationship among selected listed manufacturing
companies' capital structure, firms' growth, liquidity position and profitability. Finally as a
researcher suggests that every selected listed manufacturing firm should give key focus on its
firm's growth, capital structure and liquidity position to enhance its profitability in the future.
