Orion Group Holdings (ORN) risk factors, FY2024 10-K

Other

1. 01We may be unable to obtain sufficient bonding capacity for our contracts and the need for performance and surety bonds may adversely affect our business
2. 02We rely on highly competitive and highly regulated government contracts
3. 03Our operations are susceptible to a variety of adverse conditions including weather conditions, natural disasters, health epidemics or pandemics or other contagious outbreaks and terrorist attacks that could negatively impact the markets in which we operate
4. 04Demand for our services may decrease due to economic recession or a reduction of demand in end markets of our customers
5. 05Interest rates may affect the cost of financing for our customers’ capital projects and investments. These increased costs may affect their capacity and willingness to undertake new investments, and may result in the delay or cancellation of projects they would otherwise undertake
6. 06We may not be able to fully realize the revenue value reported in our backlog
7. 07We could suffer contract losses if we fail to accurately estimate our costs or fail to execute within our cost estimates on fixed-price, lump-sum contracts
8. 08We could suffer penalties on our contracts for late completion
9. 09Our projects could be hindered due to our dependence on third parties to complete many of our contracts
10. 10We may incur higher costs to acquire, manufacture and maintain equipment necessary for our operations
11. 11Our business is subject to significant operating risks and hazards that could result in damage or destruction to property, injuries or loss of life, which could result in losses or liabilities to us
12. 12Our marine segment operates in jurisdictions outside of the U.S. and we intend to continue expanding our operations to more jurisdictions outside of the U.S
13. 13Our current insurance coverage may not be adequate, and we may not be able to obtain insurance at acceptable rates, or at all
14. 14Our operations are subject to environmental laws and regulations that may expose us to significant costs and liabilities
15. 15The anticipated investment in port and marine infrastructure may not be as large as expected, which may result in periods of low demand for our marine construction services
16. 16Restrictions on foreign ownership of our vessels could limit our ability to sell off any portion of our marine construction segment or result in the forfeiture of our vessels or in our inability to continue our operations in United States navigable waters
17. 17Our concrete segment is geographically concentrated in Texas
18. 18A significant portion of our revenues may be concentrated among a small number of projects
19. 19The timing and funding of new contracts may result in volatility in our cash flow and profitability. These factors as well as others that may cause our actual financial results to vary from any publicly disclosed earnings guidance and forecasts are outside of our control
20. 20As of December 31, 2024, we had a pipeline of opportunities of approximately $16 billion. We define our pipeline of opportunities as specific projects that we have identified and are tracking as projects of interest
21. 21We conduct a portion of our operations through joint ventures, exposing us to risks and uncertainties, many of which are outside of our control
22. 22If we fail to attract, retain and engage appropriately qualified employees, including employees in key positions, our operations and profitability may be harmed. In addition, changes in market compensation rates may adversely affect our profitability
23. 23We may be subject to unionization, work stoppages, slowdowns or increased labor costs
24. 24Our employees in the marine segment are covered by federal laws that provide seagoing employees remedies for job-related claims in addition to those provided by state laws
25. 25If we fail to comply with immigration laws, such failure could result in significant liabilities, harm our reputation with our customers and disrupt our operations
26. 26Systems and information technology interruption or failure and data security breaches could adversely impact our ability to operate or expose us to significant financial losses and reputational harm
27. 27Adverse changes in tax laws both in the United States and abroad, changes in tax rates or exposure to additional income tax liabilities could have a material adverse effect on our results of operations
28. 28Our indebtedness includes covenants and obligations with regard to our business activities that may restrict our ability to take certain actions which may negatively affect our financial condition
29. 29Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly
30. 30Our bonding requirements may limit our ability to incur indebtedness