Weak Cash Flow ConversionNegative operating and free cash flow signal difficulties converting accounting profits into cash, pressuring liquidity for capex, inventory and supplier payments. Over months this can force tighter working-capital management or reliance on balance-sheet buffers to fund operations.
Declining Margins And Volatile RevenueFalling gross and net margins alongside volatile revenue suggest weakening pricing power or higher input costs. For a commodity-linked fabricator, sustained margin erosion reduces ability to fund investments and makes earnings less predictable across the business cycle.
Erosion Of Shareholders' EquityA declining equity base shrinks the financial cushion against losses and may limit future borrowing capacity. Coupled with negative cash flow, ongoing equity erosion could constrain capital allocation, increase financial vulnerability during downturns, and limit strategic flexibility.