Declining RevenuesSustained top-line decline reduces scale and makes it harder to cover fixed costs in machine-tool manufacturing. Continued revenue contraction constrains margin recovery, limits reinvestment in product development and systems, and weakens competitive positioning over the medium term.
Negative ProfitabilityPersistent negative EBIT and net income, alongside a negative ROE, indicate the business is not generating adequate returns. Continued losses erode equity, limit reinvestment, and increase the likelihood of cost cutting or external financing, impairing long-term strategic execution.
Weak Free Cash Flow ConversionInefficient conversion of accounting profits into free cash constrains the firm's ability to service debt, sustain dividends, or fund capital projects internally. Over time this reduces financial flexibility and may force dilutive or costly financing if operating performance does not improve.