Evaluating the financial performance of Dana Gas Company operation in Iraq, an applied study using the VECM model

Abstract

Financial performance is crucial in making strategic decisions and is highly used by managers to outline their future operations. In large-scale companies like energy companies analyzing financial performance is of utmost importance. In this regard, the present study attempts to evaluate the financial performance of DANA GAS Company in Iraq from 2007Q1 to 2021Q4 using a Vector Error Correction Model (VECM). The study contributes to a better understanding of the relationships between financial indicators and revenue growth in the energy sector. The VECM approach provides a useful tool for evaluating financial performance, allowing companies to identify areas for improvement and make data-driven decisions. The analysis reveals significant long-term relationships between financial indicators and revenue growth. Profitability, return on assets and liquidity with the company's revenue growth. However, the return on equity shows a negative sign, while the company size is insignificant. The findings have implications for strategic decision-making and financial management practices aimed at enhancing Dana Gas Company's financial performance and resilience in dynamic market environments