The effects of Foreign Exchange Rate Volatility on the Financial Performance of Listed Construction Companies in Zimbabwe: Case study of Masimba Holdings Limited.
- Author
- Ruzvidzo, Nyasha
- Title
- The effects of Foreign Exchange Rate Volatility on the Financial Performance of Listed Construction Companies in Zimbabwe: Case study of Masimba Holdings Limited.
- Abstract
-
The research aimed at analyzing the effects of foreign exchange rate volatility on the financial performance of listed construction companies in Zimbabwe. Its main objectives
were to analyse the determinants of FX volatility, identify key performance pointers of financial performance and explore the extent to which FX volatility is contributing to
financial performance. Both primary and secondary sources of data such as key informant interviews, questionnaires, focus group discussions and desk research were used to gather information. No sampling was done since the population was small. Data analysis was achieved using SPSS version 22 (Statistical Package for the Social Sciences). A regression model was applied to conclude the relationship between FX volatility and MHL’sfinancial
performance. The findings of the study revealed that Masimba Holdings' financial performance is considerably influenced favorably by foreign exchange rate volatility. Additionally, the findings suggested that independent factors such foreign exchange rate volatility, liquidity, company size, and inflation levels can accurately forecast 67.2% of
changes in profitability (ROA & ROE). By using coefficient correlation, the impact of the inflation rate, total assets, foreign exchange volatility, sales volume, and liquidity on financial performance has been demonstrated. Since a rise in inflation rates results in a decline in financial performance, the research advised policy makers to strengthen their
policies to reduce the rise in inflation rates. The study recommended Masimba Holdings Limited to continue monitoring its performance in order to keep its existence felt in the market.
- Date
- June 2023
- Publisher
- BUSE
- Keywords
- Foreign Exchange Rate
- Financial Performance
- Supervisor
- N/A
- Item sets
- Department of Accountancy
