ABSTRACT
A firm’s profitability is critical to its competitiveness and
sustainability. This research looked at the elements that influence airline profitability
in Nigeria. From 2005 to 2019, two airlines were picked, and their data were retrieved from Nigerian
Civil Aviation Authority (NCAA). From estimated quarterly panel data using
E-views 8 and SPSS 22, the overall findings of the regression study demonstrate that with ROA used as a proxy
for profitability, the R-square is 83.6 per cent and 89.4 per cent,
respectively for Aero contractors and Medview airline, representing 83.6 per
cent and 89.4 per cent of the changes in profitability of the Aero contractors
and Medview in the sample, respectively, could be explained by changes in the
study’s independent variables, namely growth, liquidity, leverage, lease,
tangibility, fuel cost and personnel cost. Besides the total of the explanatory
variables, growth, leverage and tangibility are statically significant at a 5%
level of significant Aero Contractors. Growth, leverage, leasing cost, fuel
cost, and staff cost, on the other hand, are statistically significant at the 5% level of significance for Medview airlines.
Profiteering, expansion, leverage, and tangibility are the primary activities
of any airline firm. Lease cost, fuel cost, and staff cost show a statistically
significant positive link with the profitability metric ROA. As a result,
stakeholders of Nigerian airlines should prioritize profitability over other
criteria in this study. Airline executives should do a comprehensive analysis
of all potential elements impacting their company’s profitability in the
literature, including aspects other than economic variables. According to the
findings of this study, political issues account for a greater proportion of
the reasons why airlines fail in Nigeria.