Margin CompressionMargins stepped down materially in 2025 versus 2024 (net margin ~20.1%, EBIT ~25.6%), and gross margin fell sharply. Sustained margin erosion can reduce free cash flow, constrain reinvestment, and weaken return metrics unless driven costs or pricing trends are addressed.
Weak Free Cash Flow ConversionFree cash flow was negative across several years and only modestly positive in 2025, implying working‑capital swings or heavy reinvestment. Persistent weak FCF limits funding for dividends, buybacks, debt reduction, or capex and raises sensitivity to cash‑flow shocks.
Moderate ROE, Pressure RiskReturns on equity are moderate (~11–16%) and could decline if profitability softens further. That points to average capital efficiency versus peers; continued margin pressure would further erode ROE, affecting long‑term shareholder return potential and capital allocation flexibility.