Rising LeverageIncreasing debt-to-equity raises financial risk by elevating interest and refinancing exposure. For a capital-intensive utility, higher leverage can limit flexibility for capex, acquisitions, or shareholder returns, and makes the company more sensitive to rate or commodity shocks over the medium term.
Inconsistent Free Cash FlowVolatile free cash flow, driven by capex and operating variability, constrains the company’s ability to sustainably fund dividends, debt reduction, or strategic investments. Persistent FCF inconsistency undermines long-term financial flexibility and heightens reliance on external funding.
Margin Pressure And Profit VolatilityDeclining gross and net margins and fluctuating operating profitability point to cost pressure or weakened pricing power (e.g., LNG procurement costs). Sustained margin erosion increases earnings volatility and reduces capacity to build reserves or invest in higher-return initiatives.