High LeverageA high debt-to-equity ratio raises long-term financial risk, increasing interest burden and limiting strategic flexibility. Elevated leverage makes the company vulnerable to demand shocks and interest-rate moves, constraining its ability to invest or absorb margin pressure without deleveraging.
Sharp Revenue ContractionA near 28% revenue drop signals structural demand loss or market-share erosion, undermining scale economics. Sustained top-line weakness pressures margins, reduces operating leverage, and prolongs recovery timelines, requiring material order wins or pricing improvements to restore profitability.
Negative Free Cash Flow & Weak Cash ConversionPersistent negative free cash flow and poor profit-to-cash conversion imply reliance on external funding to meet obligations and capex. This structural cash-generation weakness heightens refinancing risk given high leverage and limits reinvestment capacity for growth or margin improvement.