Capex Pressure On Free Cash FlowElevated capex that meaningfully reduces free cash flow can constrain the company’s ability to pay down debt, return capital, or fund expansion without external financing. If sustained, it weakens liquidity flexibility and raises funding needs over the medium term.
Volatility In EBIT MarginUnstable EBIT margins point to sensitivity in cost structure or pricing power, which can lead to earnings unpredictability. Over 2-6 months this increases forecast risk, complicates capital allocation decisions, and may pressure returns if volatility persists.
Moderate Reliance On LiabilitiesA material reliance on liabilities versus equity heightens exposure to interest-rate shifts and refinancing cycles. In adverse market conditions it could limit strategic moves or increase financing costs, reducing long-term financial flexibility and risk tolerance.