The impact of working capital management on firm profitability during crisis and non-crisis: evidence from Thailand

This study examines the relationship between working capital management and Thai listed firms' profitability during crisis and non-crisis in six industries. The sample in the Stock Exchange of Thailand over the period from 1997-2020 based on quarterly basis by panel regression with fixed effects estimation method. The proxy for working capital management is the cash conversion cycle and its components. The results demonstrate that the cash conversion cycle has a negative relationship with profitability during crisis and non-crisis. Moreover, the impact of the working capital management of each industry depends on the measurement of profitability in term of book value and market value. Results showed that the cash conversion cycle has no impact to the market value. The shorter cash conversion cycle would be good in term of book value. Firms can manage working capital efficiency by decreasing cashconversion cycle