Weak Cash GenerationA sharp decline in operating cash flow and zero free cash flow undermine the company's ability to internally fund inventory, capex, and distributions. For a trading business with heavy working capital needs, persistent weak cash conversion forces reliance on external financing and limits strategic flexibility.
Lower Equity RatioA lower equity ratio increases financial vulnerability and reduces shock absorption capacity. For a trade-centric exporter dependent on receivables and inventory, increased reliance on liabilities raises refinancing and liquidity risk, potentially constraining growth or increasing funding costs under stress.
Modest Operating MarginsRelatively modest EBIT/EBITDA margins indicate limited operating efficiency headroom. In a business sensitive to tobacco leaf prices, logistics and FX, small margin contractions can materially hit profitability and cash flow, restricting the company's ability to absorb cost shocks or invest in growth initiatives.