Weak Cash ConversionEarnings are not converting efficiently into cash, with FCF materially below net income and operating coverage ratios under 0.5. This structural conversion gap limits liquidity flexibility, constrains sustained investment or rapid deleveraging during demand shocks.
High Earnings CyclicalityThe airline's results have historically swung from deep losses to strong profits, reflecting sensitivity to travel demand, fuel and macro shocks. This inherent cyclicality means earnings and cash flows can deteriorate quickly during downturns, stressing planning and capital allocation.
Absolute Debt Still SizableAlthough leverage ratios improved, the company still carries a large absolute debt stock. High fixed obligations reduce margin for error in downturns, limit free cash for strategic investments, and increase vulnerability to rate or liquidity pressures over the medium term.