Negative Equity / High LeverageNegative equity and elevated leverage signal structural solvency and capital-structure stress. This weakens creditor and investor confidence, limits ability to raise non-dilutive capital, increases default risk under stress, and constrains strategic investments over the medium term.
Poor Cash GenerationSustained negative operating and free cash flows erode liquidity and force reliance on external financing or asset sales. Over months, this hampers reinvestment in the core business, elevates refinancing risk, and can necessitate dilutive equity or costly debt, undermining long-term viability.
Ongoing Losses & Margin DeclinePersistent negative margins and ongoing losses point to structural operating inefficiencies or revenue mix challenges. Without material cost restructuring or sustainable revenue expansion, the company faces prolonged unprofitability, limiting free cash flow generation and strategic flexibility.