Negative Cash GenerationOngoing negative operating and free cash flows undermine the company’s ability to fund operations or capex internally. Over a multi-month horizon this forces reliance on external financing, increasing dilution or leverage risk and constraining strategic investments.
Consistent Net Losses And Margin PressureSustained negative EBIT and net income indicate structural margin problems. Persistent losses erode equity, limit reinvestment capacity, and impair the company’s ability to achieve operating leverage from revenue growth, threatening long-term competitiveness in apparel manufacturing.
Declining Equity Ratio And Negative ROEA falling equity ratio reduces the company’s financial cushion and a negative ROE signals value destruction. These structural balance-sheet weaknesses raise refinancing costs, heighten creditor and supplier scrutiny, and increase the risk profile over the coming months.