Net Profit Margin CompressionFalling net margins suggest rising operating expenses, cost inflation, or pricing pressure that erode retained earnings. Persistent margin compression limits ability to self-fund investments and dividends, and could require structural cost actions to restore long-term profitability.
Deteriorating Cash Generation And Negative FCFA sharp drop in operating cash and negative free cash flow from heavy capex weakens liquidity and financial flexibility. Over several quarters this can force higher external financing, delay discretionary investments, or constrain working capital management in cyclical steel markets.
Falling Returns On Equity And EPS ContractionDeclining ROE signals reduced effectiveness in converting capital into earnings. If sustained, lower profitability metrics can limit retained earnings for growth, reduce shareholder return potential, and indicate operational or competitive headwinds persisting over multiple quarters.