High LeverageHigh debt-to-equity indicates significant leverage that constrains financial flexibility. Elevated interest and principal obligations raise default and covenant risks, and reduce the firm's ability to invest or absorb setbacks, a persistent downside over the medium term.
Negative ProfitabilityNegative net profit and EBIT margins show the business is not covering operating costs, undermining self-funding ability. Persistent margin weakness erodes equity and limits capacity to deleverage or invest, requiring structural cost or pricing improvements to restore profitability.
Earnings Collapse / EPS VolatilityAn extreme negative EPS growth rate reflects a severe earnings shock and high volatility. Such deterioration weakens reinvestment capacity, raises refinancing and covenant risks given existing leverage, and makes operational recovery and stakeholder confidence harder to achieve.