Net Margin CompressionCompression from previously strong profits to low single-digit net margins suggests operating cost increases or heavy reinvestment that erode bottom-line scalability. If structural, this reduces cash available for reinvestment or shareholder returns and can persistently lower ROIC.
Uneven Free Cash FlowVolatile FCF and modest operating cash conversion create uncertainty in funding growth, capital allocation, and balance sheet strengthening. Irregular cash generation complicates long-term investment planning and reduces predictability for buybacks, dividends, or debt reduction.
Earnings And ROE VolatilityLarge swings in profitability and ROE signal earnings sensitivity to project timing, client concentration, or cost variability. Persistent volatility undermines forecasting, increases required risk premia for long-term capital, and may hamper ability to sustain strategic multi-year programs.