Persistent Negative Cash FlowConsistent annual operating and free cash outflows force reliance on external funding, asset sales or partner contributions. Over months this constrains the ability to fund exploration/appraisal, increases dilution or financing risk, and limits discretionary investment in higher‑value options.
Limited Recurring Revenue; Loss-makingThe lack of steady production revenue and return to losses mean profitability depends on sporadic one-off events. Structurally this weakens operating leverage, makes cashflow forecasting uncertain for partners and lenders, and raises execution risk for multi-stage exploration programs.
Declining Equity And Negative ROEShrinking shareholder equity and negative returns signal erosion of net asset value from ongoing losses. Over the medium term this reduces balance-sheet resilience, limits borrowing capacity, and may impair the company’s terms when negotiating farm-outs or raising fresh capital.