Declining Free Cash FlowA >30% fall in free cash flow is a durable concern for funding development pipelines, servicing covenants and supporting dividends or buybacks. Even with operating cash conversion near unity, weaker FCF limits optionality on land purchases and increases reliance on external financing in stressed cycles.
Low Net Profit MarginA mid-single-digit net margin leaves limited room to absorb cost inflation, price softness or higher overheads. For a housebuilder, low net margins reduce capacity to finance expansion from earnings and heighten sensitivity to slower sales rates or margin pressure over the medium term.
Geographic Concentration RiskConcentrated exposure to Scotland, and an explicit strategic shift to North Scotland, increases sensitivity to regional housing demand, planning outcomes and local policy. Geographic concentration can amplify cyclical or regulatory shocks versus more diversified national developers over several quarters.