What the changes say
- Seven new risks emphasize tariffs, the Propelis investment and reporting lag, activism, stock volatility, share issuance, and takeover defenses.
- Tesla intellectual-property litigation remains a named risk, while competitive-risk disclosure removes SGK global-supplier pressure.
- Ukraine employee exposure is no longer mentioned; the global-conflict risk now identifies Russia only.
What changed since the prior 10-K
New
- NewCompany-Specific Risk Factors
Changes to U.S. trade policy, including new or increased tariffs and changing import/export regulations, could have a material adverse effect on the Company's operating results
New or higher U.S. tariffs and changing trade rules could raise costs or disrupt business with the European Union, China, Canada, and Mexico.
- NewCompany-Specific Risk Factors
The Company's results of operations could be impacted if its investment in Propelis fails to perform as expected
Matthews depends on its minority investment in Propelis, over whose operations and distributions it lacks control.
- NewCompany-Specific Risk Factors
The equity income the Company reports from Propelis is reported on a three-month lag basis, which impacts the quarterly and fiscal year timing of when Propelis’ results and synergies are reflected in the Company's financial statements
Propelis results and expected synergies reach Matthews’ financial statements three months late, shifting their quarterly and fiscal-year timing.
- NewRisks Related to the Company's Securities
The Company's business could be negatively affected as a result of actions of activist shareholders
Future activist shareholder campaigns could disrupt operations, consume management attention, affect personnel and partners, and potentially trigger credit-facility defaults.
- NewRisks Related to the Company's Securities
The market price for the Company's common stock has experienced significant price and volume volatility and is likely to continue to experience significant volatility in the future. This volatility may impair the ability to finance strategic transactions with the Company's stock and otherwise harm the Company's business
Continued common-stock price and trading-volume volatility could impair financing strategic transactions with Matthews shares and otherwise harm the business.
- NewRisks Related to the Company's Securities
The Company's Amended and Restated Articles of Incorporation grants the Company's board of directors the power to designate and issue additional shares of common and/or preferred stock
The board can issue preferred or common shares without shareholder approval, potentially creating securities with rights superior to common stock.
- NewRisks Related to the Company's Securities
Provisions of the Company's charter documents or Pennsylvania law could discourage, delay or prevent the Company from being acquired even if being acquired would be beneficial to the Company's shareholders and could make it more difficult to change management
Pennsylvania law and Matthews’ governing documents could delay or prevent beneficial acquisitions and make management changes more difficult.
Reworded
- 72% rewrittenGeneral Risk Factors
The Company's business is affected by general economic conditions, and any economic decline or other circumstances that result in reductions in the Company's customers’ spending could negatively impact the Company's sales volume and revenues
No substantive change; the risk continues covering economic downturns, customer spending, currencies, raw materials, and other conditions.
- 30% rewrittenCompany-Specific Risk Factors
Intellectual property infringement assertions by third parties, including those of Tesla, Inc. ("Tesla"), could result in significant costs and adversely affect the Company's business, financial condition, operating results and reputation
Wording changes clarify the Tesla allegations concern dry battery electrode intellectual property and replace “assure” with “ensure.”
Was: Intellectual property infringement assertions by third parties, including those of Tesla, could result in significant costs and adversely affect the Company's business, financial condition, operating results and reputation
- 23% rewrittenCompany-Specific Risk Factors
The Company is subject to competitive pressures, including with respect to product demand and pricing
The revised text removes the specific SGK risk that global customers demand globally scoped, price-competitive suppliers.
- 20% rewrittenCompany-Specific Risk Factors
Global conflicts may impact the Company's business and the markets in which the Company operates
The employee exposure reference narrows from Eastern Europe including Russia and Ukraine to Russia; Ukraine remains in the conflict example.
All 32 risk factors
Headings as the filing states them, in filing order.
Company-Specific Risk Factors
- 01The Company's international sales and operations expose the Company to significant risks and failure to manage those risks could materially adversely impact the Company's business
- 02Changes in foreign currency exchange rates could have an adverse effect on the Company's revenue, cash flows and financial results
- 03Interest rate fluctuations could increase the Company's financing costs and reduce the Company's ability to obtain additional indebtedness or debt refinancing, which could materially and adversely affect the Company
- 04Increased prices for raw materials or shortages could adversely affect the Company's results of operations and cash flows
- 05Changes to U.S. trade policy, including new or increased tariffs and changing import/export regulations, could have a material adverse effect on the Company's operating resultsNew
- 06The Company's balance sheet includes a significant amount of goodwill and intangible assets. An impairment in the carrying value of goodwill could negatively impact the Company's consolidated results of operations and total assets
- 07Changes in mortality and cremation rates could have a material adverse effect on the Company's cash flows and revenues
- 08The Company is subject to competitive pressures, including with respect to product demand and pricing23% rewritten
- 09The loss of any of the Company's large customers could have a material adverse effect on the Company's cash flows and results of operations
- 10The Company faces additional global supply chain risks and risks of interruption of requisite logistics and transportation services, including as a result of the Company's reliance on limited suppliers and vendors for certain components, materials, and services
- 11Pandemics or similar outbreaks may cause unfavorable economic or market conditions, which could impact demand patterns, access to capital and/or disrupt global supply chains and manufacturing operations
- 12Global conflicts may impact the Company's business and the markets in which the Company operates20% rewritten
- 13The Company faces risks in connection with acquisitions, divestitures and business combinations, including the Company's ability to identify or successfully complete any such acquisitions, divestitures or business combinations, to effectively integrate acquired businesses or to effectively manage the remaining business or the combined business
- 14The Company's results of operations could be impacted if its investment in Propelis fails to perform as expectedNew
- 15If the Company is unable to adequately protect the Company's intellectual property, the Company's business, financial condition or results of operations could be materially and adversely affected
- 16Intellectual property infringement assertions by third parties, including those of Tesla, Inc. ("Tesla"), could result in significant costs and adversely affect the Company's business, financial condition, operating results and reputation30% rewritten
- 17The Company is subject to environmental laws and regulations, as well as environmental remediation and compliance that may lead to significant unforeseen expenses
- 18The equity income the Company reports from Propelis is reported on a three-month lag basis, which impacts the quarterly and fiscal year timing of when Propelis’ results and synergies are reflected in the Company's financial statementsNew
- 19The Company relies on third parties and their systems for a variety of services, including significant information technology services, and the failure of these third parties to provide these services could disrupt the Company's business
- 20If the Company is unable to keep pace with technological changes, some of which are beyond the Company's control, the Company may not be able to maintain the Company's competitive position
- 21Changing laws and regulations relating to privacy, information security and data protection could increase the Company's costs, and the failure to comply with such laws and regulations could result in significant business disruptions, litigation or enforcement actions
- 22Future tax law changes and/or interpretation of existing tax laws may adversely affect the Company's effective income tax rate and require adjustments to the Company's tax estimates
- 23The Company operates in a regulated environment that requires the Company's compliance with laws and regulations. Non-compliance could subject the Company to sanctions and materially adversely affect the Company's business
Risks Related to the Company's Securities
- 24The Company's business could be negatively affected as a result of actions of activist shareholdersNew
- 25The market price for the Company's common stock has experienced significant price and volume volatility and is likely to continue to experience significant volatility in the future. This volatility may impair the ability to finance strategic transactions with the Company's stock and otherwise harm the Company's businessNew
- 26The Company's Amended and Restated Articles of Incorporation grants the Company's board of directors the power to designate and issue additional shares of common and/or preferred stockNew
- 27Provisions of the Company's charter documents or Pennsylvania law could discourage, delay or prevent the Company from being acquired even if being acquired would be beneficial to the Company's shareholders and could make it more difficult to change managementNew
General Risk Factors
- 28The Company's business is affected by general economic conditions, and any economic decline or other circumstances that result in reductions in the Company's customers’ spending could negatively impact the Company's sales volume and revenues72% rewritten
- 29The Company's results of operations could be adversely affected by labor shortages, turnover and labor cost increases
- 30The Company relies on information technology to operate the Company's business. Security breach incidents and breakdowns of information technologies, or failure to comply with laws governing data privacy and data protection, could disrupt the Company's operations, subject the Company to legal claims, and impact the Company's financial results
- 31If the Company fails to maintain effective internal controls over financial reporting at a reasonable assurance level, the Company may not be able to accurately report the Company's financial results, and may require the restatement of previously published financial information, which could have a material adverse effect on the Company's operations, investor confidence in the Company's business and the trading price of the Company's securities
- 32The Company's efforts to comply with Dodd-Frank and other evolving laws and regulations could result in increased costs and expenses related to compliance and potential violations
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.