Efficiency of working capital management and profitability of UAE construction companies: size and crisis effects

Abstract

This paper aims to examine the relationship between the efficiency of working capital management and profitability of construction firms listed in the United Arab Emirates stock markets. The results show negative and significant relationship between net trade cycle for all construction firms and large construction firms. The coefficient of small firms is positive and insignificant, this indicates that small construction firms do not manage their working capital efficiently. The results also show negative and significant relation between the net trade cycle and profitability of construction firms during crisis periods. This indicates that UAE construction companies are more efficient in managing their working capital during crisis period.