Negative Free Cash FlowPersistently negative and inconsistent free cash flow limits internal funding for working capital and capex, increasing reliance on external financing. For an EPC/manufacturing firm, weak FCF heightens execution risk, constrains margin improvement initiatives, and can pressure liquidity during project seasonality.
Margin And Net Income PressureDeclining operating margins despite revenue growth point to rising input or execution costs and weaker pricing power. Prolonged margin compression can erode return on capital, reduce cash conversion, and impair the company's ability to sustain investment in capacity or absorb commodity volatility.
Earnings Volatility (EPS Decline)A sharp decline in EPS signals volatility in project outcomes, timing of revenue recognition, or elevated non-operating costs. Persistent earnings volatility undermines predictable cash generation, complicates capital allocation and long-term planning, and raises the cost of external capital for project financing.