Negative Stockholders' EquityNegative equity means liabilities exceed assets, creating severe solvency and refinancing risk. This structural capital shortfall constrains access to funding, limits flexibility to invest or weather shocks, and increases the likelihood of creditor pressure absent a credible recapitalization plan.
Weak Cash GenerationPersistent negative operating cash flow and zero free cash flow impair the company’s ability to service debt, fund capex, and invest in turnaround initiatives. Reliance on external funding becomes structural, elevating refinancing risk and hindering long-term operational recovery.
Declining Revenue And Negative ProfitabilityOngoing revenue declines and negative EBITDA indicate the core restaurant operations are unprofitable and losing scale. Structural margin deterioration reduces internal reinvestment capacity, weakens competitive positioning, and demands material business-model fixes to restore sustainable profitability.