Internal determinants of financial performance among listed food supermarkets in the South African economy

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This study aims to examine the internal determinants of financial performance of food supermarkets listed on the South African stock exchange. Food supermarkets play an integral role in socio-economic development of the country. The study employed an econometric approach utilizing fixed effect panel data. Drawing information from audited financial statements, data were gathered from four major listed food supermarkets in South Africa covering the period from 1994 to 2022, resulting in a total of 116 observations over 29 years. The robust longitudinal statistics obtained from balanced data revealed a significant positive correlation between equity financing, size of corporate governance, and current debt with financial performance, as measured by sales revenue at 0.0000, 0.054, and 0.000 significance levels, respectively. The findings indicate that as these variables increase, the financial performance of the studied food supermarkets (Shoprite, Woolworths, Spar, and Pick n Pay) also increases. Conversely, a negative and significant relationship is noted between company age, current assets, and financial performance at significance levels of 0.007 and 0.002, respectively. This suggests that as these variables increase, financial performance will decrease. As per the research findings, it is imperative for supermarkets to uphold a well-rounded blend of equity and debt and adopt inventive business approaches as they mature to improve financial outcomes. Therefore, the study proposes a framework focusing on internal factors that impact the financial performance of listed food supermarkets in South Africa.

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    • Table 1. Research variables
    • Table 2. Correlation matrix results
    • Table 3. ANOVA results
    • Table 4. Kao test for cointegration
    • Table 5. Im-Pesaran-Shin unit-root test
    • Table 6. Cross-section dependence, CD ~ N(0,1)
    • Table 7. Linear regression, heteroskedastic PCSEs
    • Table 8. Cross-sectional time-series FGLS regression
    • Conceptualization
      Zwelihle Wiseman Nzuza
    • Data curation
      Zwelihle Wiseman Nzuza
    • Formal Analysis
      Zwelihle Wiseman Nzuza, Oloyede Obagbuwa, Rajendra Rajaram
    • Investigation
      Zwelihle Wiseman Nzuza
    • Methodology
      Zwelihle Wiseman Nzuza
    • Project administration
      Zwelihle Wiseman Nzuza
    • Resources
      Zwelihle Wiseman Nzuza, Oloyede Obagbuwa, Rajendra Rajaram
    • Writing – original draft
      Zwelihle Wiseman Nzuza
    • Supervision
      Oloyede Obagbuwa, Rajendra Rajaram
    • Validation
      Oloyede Obagbuwa, Rajendra Rajaram
    • Writing – review & editing
      Oloyede Obagbuwa, Rajendra Rajaram