Volatile, Often Negative Free Cash FlowRepeated negative or volatile free cash flow reduces internal funding for capex and distributions, increasing dependency on debt or asset sales. Over months to years, this undermines distribution visibility and constrains capital allocation flexibility, especially during tighter financing windows.
Weak Cash Conversion From EarningsOperating cash covering only a portion of reported earnings signals poor earnings quality and limited cash generation. Structurally weak cash conversion heightens refinancing and payout risks, forcing reliance on external funding or equity issuance to meet distributions and capital needs.
Persistently Elevated LeverageLeverage near historical highs increases sensitivity to rising rates and market dislocations, elevating refinancing risk for maturing debt. Over the medium term this can limit growth, pressure interest coverage and reduce strategic flexibility, particularly if cash generation remains uneven.