Thin Operating And Net MarginsVery slim margins leave limited cushion for cost inflation or volume shocks, constraining free cash generation and capital investment. Margin fragility increases sensitivity to raw‑material, labor, or pricing pressure, making sustained earnings growth vulnerable without structural margin improvement.
Rising Debt And Moderate LeverageElevated and increasing leverage limits financial flexibility, raising refinancing and interest-rate exposure. With only mid-single-digit returns, reliance on debt can constrain strategic investments or shareholder returns and heighten risk if profitability or cash flow weakens over the medium term.
Negative Free Cash Flow In 2024–2025Repeat negative free cash flow after investments indicates the company is not converting operating cash into surplus liquidity, pressuring its ability to reduce debt, fund dividends, or self‑finance growth. Continued negative FCF may force external financing and weaken long-term financial resilience.