Weak Cash ConversionAlthough operating cash flow and FCF are positive, FCF is only ~43% of net income TTM, indicating earnings are not fully translating to cash. This weak conversion constrains debt paydown, capex funding and cushions against revenue shocks over the medium term.
Cyclicality & Demand SensitivityAirline earnings remain highly sensitive to travel demand and cost swings. Prior severe losses highlight exposure to downturns and commodity or demand shocks, increasing earnings volatility and making multi-quarter planning and consistent cash generation more challenging.
Sizable Absolute DebtEven with improving leverage ratios, absolute debt levels are still meaningful. Combined with imperfect cash conversion, this limits strategic flexibility, increases interest and refinancing exposure, and raises pressure on margins during adverse cycles.