High Financial LeverageA debt-to-equity of ~2.5 creates a structural interest and refinancing burden that reduces financial flexibility. In an education business with intake seasonality or policy shifts, high leverage amplifies downside risk and constrains investment capacity over months.
Ongoing Operating LossesA sustained negative net margin erodes equity and limits reinvestment into programs or marketing needed to grow enrolments. Continued losses can force higher leverage or dilutive capital raises, weakening the balance sheet and long-term strategic optionality.
Negative ROE And Low Equity BaseNegative ROE and a low equity ratio signal structural inefficiency converting capital into returns. Combined with small scale, this reduces competitive reinvestment capacity and makes the group more vulnerable to policy shifts or enrolment downturns over the medium term.