Sharp Deterioration In Profitability And MarginsSustained negative operating profits and compressed gross margins indicate weakened project economics and pricing power. If margins don't recover, retained losses will limit reinvestment, force asset sales or lower-quality projects, and impair long-term return generation.
Negative Operating And Free Cash FlowPersistent negative operating and free cash flow erode liquidity and raise dependence on external financing. Over months, cash burn can force accelerated asset disposals, higher borrowing costs or equity raises, constraining project funding and strategic flexibility.
Elevated Leverage Increases Balance-sheet RiskA materially higher debt-to-equity ratio combined with negative ROE raises refinancing and covenant risk. Elevated leverage increases interest burden and limits capacity to bid for land or fund new projects until profitability and cash generation recover.