Margin VolatilitySharp swings in gross margin indicate exposure to raw-material price volatility or mix shifts, undermining predictability of profitability. Persistent margin variability complicates pricing, capital allocation and investors' ability to assess sustainable return levels over the medium term.
Weak Operating Cash CoverageOperating cash covering only about half of net income points to working-capital swings or accrual-driven earnings. This reduces internal funding reliability for growth and can force reliance on external financing during adverse cycles, increasing financial risk if cash conversion deteriorates.
Supply Dependence And Prior Leverage RiskDependence on sourcing and processing natural raw materials and on sustained strong earnings is structural risk. Supply disruptions, commodity spikes or demand shocks could reverse leverage improvements and pressure margins, given the company's past leverage increase in 2022–2023.