Persistent LossesOngoing operating and net losses undermine internal capital accumulation and prolong dependency on external funding. Persistent unprofitability constrains strategic investments, increases investor financing scrutiny, and risks dilution or serviceability issues if losses continue.
Thinly Capitalized, High LeverageHigh leverage and weak equity reduce financial flexibility and raise refinancing risk during stress. A thin capital base limits the company's ability to absorb shocks, slows growth initiatives, and increases the cost of capital for necessary investments or working capital needs.
Negative And Volatile Cash FlowMaterial negative free cash flow and volatility hinder self-funding of operations and capex, forcing reliance on external financing. This elevates execution risk, may lead to costly capital raises, and constrains sustainable investment in stores, supply chain, or marketing.