Constellium (CSTM) risk factors, FY2024 10-K

BUSINESS AND OPERATIONAL RISKS

1. 01We may not be able to compete successfully in the highly competitive markets in which we operate, and new competitors could emerge, which could negatively impact our market share, sales volumes and selling prices
2. 02Our offerings compete with products made from other materials, such as steel, glass, plastics, and composite materials, for various applications. Higher aluminum prices relative to alternative materials may make aluminum products less competitive
3. 03We are a global company with operations in the United States, France, Germany, Switzerland, the Czech Republic, Slovakia, China, Spain, Canada, and Mexico, and we sell our products primarily across North America, Europe, and Asia
4. 04New tariffs and other restrictive trade measures could adversely affect our business, results of operations, financial position and cash flows. On February 10, 2025, the President of the United States issued an executive order raising the U.S
5. 05We are continuing to assess the full implications of these and other tariffs for the global aluminum market and the impact they are likely to have on our business, and are considering ways in which we may mitigate potentially unfavorable impacts
6. 06The price volatility of energy costs may adversely affect our profitability
7. 07If we are unable to substantially pass through to our customers the cost of price increases of our raw materials, which may be subject to volatility, our profitability could be adversely affected
8. 08The cyclical and seasonal nature of the metals industry, our end-use markets and our customers’ industries could adversely affect our financial condition and results of operations
9. 09We may be unable to execute and timely complete our expected capital investments or may be unable to achieve the anticipated benefits of such investments
10. 10We may fail to implement or execute our business strategy, successfully develop, and implement new technology initiatives and other strategic investments
11. 11We may be affected by climate change or by legal, regulatory, or market responses to such change, and our efforts to meet ESG targets or standards or to enhance the sustainability of our businesses may not meet the expectations of our stakeholders or regulators
12. 12Our failure to meet customer manufacturing and quality requirements, standards, and demand, or changing market conditions could have a material adverse impact on our business, reputation, and financial results
13. 13Our business is exposed to customer concentration risk. A significant downturn in the business, credit or financial condition of our largest customers could expose us to the risk of default on contractual agreements, or reductions or deferrals of those customers' requirements for our products
14. 14We are dependent on a limited number of suppliers for a substantial portion of our aluminum supply and a failure to successfully renew or renegotiate our agreements with our suppliers, or supply interruptions, may adversely affect our results of operations, financial condition, and cash flows
15. 15Consequently, if this difference narrows for a considerable period of time or if an adequate supply of aluminum scrap is not available to us, we would be unable to recycle metals at desired volumes and our results of operations, financial condition and cash flows could be materially adversely affected
16. 16The loss of certain members of our senior management team or other key employees may have a material adverse effect on our operating results
17. 17We could experience labor disputes and work stoppages, or be unable to renegotiate collective bargaining agreements, which could disrupt our business and have a negative impact on our financial condition and results of operations
18. 18We could be required to make unexpected contributions to our defined benefit pension plans as a result of adverse changes in interest rates and the capital markets

FINANCIAL RISKS

1. 19Our level of indebtedness could limit cash flow available for our operations and capital expenditures and could adversely affect our net income, our ability to service our debt or obtain additional financing, and our business relationships
2. 20Our results of operations, cash flows and liquidity could be adversely affected if we are unable to execute on our hedging policy, if counterparties to our derivative instruments fail to honor their agreements or if we are unable to enter into certain derivative instruments
3. 21Changes in income tax rates or income tax laws, additional income tax liabilities due to unfavorable resolution of tax audits, and challenges to our tax position could have a material adverse impact on our financial results

LEGAL, GOVERNANCE AND COMPLIANCE RISKS

1. 22Significant legal proceedings and investigations, proprietary claims, regulatory and compliance costs, including with regard to environmental matters, could increase our operating costs and adversely affect our financial condition and results of operations
2. 23As a "foreign private issuer," as defined in Rule 405 under the Securities Act of 1933, as amended (the "Securities Act"), we are permitted to follow our home country practice in lieu of certain corporate governance requirements of the NYSE
3. 24Any shareholder acquiring 30% or more of our voting rights may be required to make a mandatory takeover bid or be subject to claims for damages
4. 25United States civil liabilities may not be enforceable against the Company
5. 26Any inability of the Company to continue to benefit from French provisions applicable to registered intermediaries ("intermédiaires inscrits") could adversely affect the rights of shareholders
6. 27If dividends were paid by our Company, it is uncertain whether our non-resident French shareholders would actually obtain the elimination or reduction of the French domestic dividend withholding tax to which they would be entitled
7. 28If dividends were paid by our Company, it is uncertain whether our shareholders would actually obtain the elimination or reduction of the Dutch domestic dividend withholding tax to which they would be entitled
8. 29The French Ruling could be revoked if the description and legal analysis of the holding structure of the shares of the Company after the completion of its transfer from the Netherlands to France was inaccurate
9. 30Purchases of our ordinary shares could be subject to the French financial transaction tax if the NYSE were to be formally recognized as a foreign regulated market by the French Financial Market Authority or the applicable provisions of the French tax code were amended

GENERAL RISKS

1. 31Widespread public health pandemics, such as COVID-19, or any major disruption, including those resulting from geopolitical and weather-related catastrophic events, could have a material and adverse effect on our business, financial condition, and results of operations
2. 32Disruptions or failures in our IT systems, or failure to protect our IT systems against cyber-attacks or information security breaches, could have a material adverse effect on our business and financial results
3. 33We continue to make investments and adopt measures designed to enhance our protection, detection, response, and recovery capabilities, and to mitigate potential risks to our technology, products, services, and operations from potential cyber-attacks
4. 34We may be exposed to fraud, misconduct, corruption, or other illegal activity which could harm our reputation and our financial results