Very Weak Cash ConversionConsistently negative free cash flow and low OCF relative to earnings indicate earnings are not translating to liquid cash. This reduces capacity for organic investment, debt paydown, or dividends, and increases reliance on external financing, constraining durable financial flexibility.
Debt-heavy Capital StructureElevated leverage, despite improvement, raises refinancing and interest-rate vulnerability and limits strategic optionality. High debt can strain liquidity in downturns and complicate funding for growth or working capital without improved cash generation or deleveraging.
Earnings And Margin VolatilityWide swings in margins and net income suggest earnings include non-recurring items or volatile cost structures, reducing predictability. Persistent volatility undermines planning, capital allocation, and investor confidence unless margins stabilize and recurring earnings increase.