Persistent Net Losses And Negative MarginsOngoing net losses and negative operating margins are structural red flags: they erode retained capital and limit reinvestment capacity. Without a credible pathway to sustained profitability, the company will struggle to fund growth and absorb shocks over the medium term.
Negative Equity And High LeverageNegative equity and high leverage materially constrain strategic flexibility, increase refinancing risk, and can limit access to capital. Over months, this heightens insolvency risk and can force dilutive financing or asset sales if cash generation slips.
Weak Free Cash Flow And Cash ConversionLow free cash flow and poor cash conversion mean the business cannot reliably turn accounting profits into spendable cash. This limits ability to deleverage, invest in late-stage trials or scale commercial activities without recurring external funding.