LIQUIDITY, ASSET UTILIZATION, DEBT RATIO AND FIRM PERFORMANCE: EVIDENCE FROM EGYPT

Abstract

How well firms handle liquidity and asset utilization determines their development, performance, and survival. Different liquidity and asset utilization methods impact firms' bottom lines. While most studies have studied the influence of liquidity and asset utilization on performance independently, this research tests both factors using debt ratio as a mediating variable. The investigation used secondary data from 50 Egyptian listed firms' annual reports from 2019-2021. Data were analyzed using descriptive statistics, correlation, and regression. The study indicated that using tangible assets and current assets (liquidity) affected corporate performance. The debt ratio does not affect asset utilization, liquidity, and company performance. This study may assist management and financial experts in examining the company's growth characteristics, liquidity and asset utilization, business risk, and financial performance to anticipate its future worth.