Falling Profitability & ROENet profit margin and return on equity have materially declined (ROE down to 7.2% from 11.9%, net margin down to ~5.3%). Lower profitability and ROE signal reduced capital efficiency and earnings quality, limiting reinvestment, shareholder returns, and the company’s ability to scale profitably in a competitive marine market.
Weak Operating Cash ConversionAn operating cash flow to net income ratio of 0.22 indicates earnings are poorly converted into operating cash. In shipbuilding, receivables, progress payments, and working capital swings can strain liquidity; persistent weak conversion raises funding needs despite strong FCF headline growth.
Compressing Operating MarginsDeclines in EBIT and EBITDA margins point to rising unit costs, competitive pricing pressure, or execution inefficiencies. For a capital- and labor-intensive marine business, sustained margin compression erodes cash flow and competitiveness, requiring structural cost or pricing improvements to restore long-term profitability.