AerSale (ASLE) risk factors, FY2024 10-K

Risks Related to AerSale’s Business and Industry

1. 01Supply chain disruptions could have adverse effects on our ability to provide certain services
2. 02We are affected by factors that adversely impact the commercial aviation industry
3. 03Market values for our aviation products fluctuate, and we may be unable to recover our costs incurred with respect to engines, rotable components and other aircraft parts
4. 04Success at our MRO facilities is dependent upon continued outsourcing by the airlines
5. 05Our operations would be adversely affected by a shortage of skilled personnel or work stoppages
6. 06The inability to obtain certain components and raw materials from suppliers could harm our business
7. 07We operate in highly competitive markets, and competitive pressures may adversely affect us
8. 08We are exposed to risks associated with operating internationally
9. 09Measures that we have or will adopt to reduce the potential impact of losses resulting from the risks of doing business internationally may not be adequate, and the regions in which we operate might not continue to be stable enough to allow us to operate profitably or at all
10. 10Business acquisitions expose us to risks, including the risk that we may be unable to effectively integrate acquired businesses
11. 11Further consolidation in the aerospace industry could adversely affect our business and financial results
12. 12Our business could be negatively affected by cyber or other security threats or other disruptions
13. 13We may need to make significant capital expenditures to keep pace with technological developments in our industry
14. 14We do not own certain intellectual property and tooling that is important to our business
15. 15We could become involved in intellectual property litigation, which could have a material and adverse impact on our profitability
16. 16Our operations depend on our facilities, which are subject to physical and other risks that could disrupt production
17. 17Our reputation, ability to do business and financial position, results of operations and/or cash flows may be impacted by the improper conduct of employees, agents, subcontractors, suppliers, business partners or joint ventures in which we participate
18. 18Our business might suffer if we were to lose the services of certain key employees
19. 19If our subcontractors or suppliers fail to perform their contractual obligations, our contract profitability and our ability to win new contracts may be adversely affected
20. 20Future outbreaks and infectious diseases could have a material adverse impact on our business, operating results, financial condition, and liquidity

Strategic and Financial Risks

1. 21We are dependent upon continued availability of financing to manage our business and to execute our business strategy, and additional financing may not be available on terms acceptable to us
2. 22Our existing debt includes restrictive and financial covenants
3. 23Restrictive covenants in the documents governing our existing and any future indebtedness may limit our current and future operations, particularly our ability to respond to changes in our business or to pursue our business strategies
4. 24Unanticipated changes in our tax provision or exposure to additional income tax liabilities could affect our profitability
5. 25Our financial results of operations could be adversely affected by impairment of our goodwill or other intangible assets
6. 26Our exposure to variable interest rates and foreign currency exchange rates could materially and adversely affect our business, operating results and financial condition

Legal and Regulatory Risks

1. 27We are subject to significant government regulation and may need to incur significant expenses to comply with new or more stringent governmental regulation
2. 28Any revocation or suspension of our material licenses, certificates, authorizations, or approvals by the FAA or equivalent regulatory agencies in other countries, may adversely impact our financial condition or results of operations
3. 29We are subject to the FCPA and other anti-corruption laws, as well as export control laws, import and customs laws, trade and economic sanctions laws and other laws governing our operations
4. 30Our business and financial results may be affected by various litigation and regulatory proceedings
5. 31Liens on our Flight Equipment could exceed the value of such Flight Equipment, which could negatively affect our ability to repossess, lease or sell such Flight Equipment
6. 32In certain countries, an engine affixed to an aircraft may become an accession to the aircraft and we may not be able to exercise our ownership rights over the engine
7. 33Our industry is susceptible to product and other liability claims, and claims not adequately covered by insurance may adversely affect our results of operations and financial condition
8. 34We must comply with extensive environmental requirements, and any exposure to environmental liabilities may adversely affect us
9. 35We may be adversely affected by global climate change, or by legal, regulatory or market responses to such change
10. 36Our share price may be volatile, and an active, liquid trading market for our common stock may not continue
11. 37If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our common stock, the price of our common stock could decline
12. 38Substantial future sales of our common stock, or the perception in the public markets that these sales may occur, may depress our stock price
13. 39We do not intend to pay dividends on our common stock in the foreseeable future
14. 40If any of our customers were to become insolvent or experience substantial financial difficulties, our business, financial condition and results of operations may be adversely affected
15. 41Our results of operations and liquidity needs could be materially negatively affected by market fluctuations or an economic downturn