Persistent Cash BurnConsistent negative operating and free cash flow erodes internal funding capacity and forces reliance on external financing. Over several months this reduces strategic optionality, increases dilution risk from equity raises, and limits the pace of exploration and project development.
Revenue Volatility And CollapseHighly volatile and collapsing revenue undermines predictability of cash inflows and indicates prior commercial successes were not durable. For an explorer this raises the risk that operating losses will continue absent new discoveries or recurring revenue streams, stressing planning horizons.
Deep Losses And Negative Returns On EquitySustained net losses and negative ROE erode shareholder capital over time and can trigger further fundraising needs. Structurally this weakens investor confidence and reduces the firm’s ability to self-fund exploration, making long-term project advancement contingent on external capital availability.