Somnigroup International (SGI) risk factors, FY2024 10-K

Risks related to our Business and Economic Environment

1. 01Participants in the mattress and pillow industries compete primarily on price, quality, brand name recognition, product availability and product performance across a range of distribution channels
2. 02Loss of suppliers and disruptions in the supply of our raw materials and components has increased and may continue to increase our costs of sales and reduce our ability to compete effectively
3. 03Changes in economic conditions, including inflationary trends in the price of our input costs, such as raw materials, due to, among other things, current geopolitical events, have adversely affected our business and financial results and could continue to do so in the future
4. 04do so within the intended timeframe

Risks related to operating our business

1. 05The performance of our business depends on our ability to implement strategic initiatives and actions taken to increase sales growth may not be effective
2. 06Our new product launches may not be successful due to development delays, failure of new products to achieve anticipated levels of market acceptance and significant costs associated with failed product introductions, which could adversely affect our revenues and profitability
3. 07We rely significantly on IT and we have experienced, and in the future could experience, cyber-based attacks which have and in the future could harm our ability to effectively operate our business
4. 08Deterioration in labor relations could disrupt our business operations and increase our costs, which could decrease our liquidity and profitability
5. 09We may face exposure to product liability claims and premises liability claims, which could reduce our liquidity and profitability and reduce consumer confidence in our products
6. 10The loss of the services of any members of our executive management team could impair our ability to execute our business strategy and as a result, reduce our sales and profitability

Regulatory, Legal and Financial Risks

1. 11We may be adversely affected by fluctuations in exchange rates, which could affect our results of operations, the costs of our products and our ability to sell our products in foreign markets
2. 12Our leverage affects how we manage our business and may limit our flexibility
3. 13We are subject to various regulatory requirements, including, but not limited to, trade, environmental, health and safety requirements, any violation of which may require costly expenditures and expose us to liability
4. 14Our pension plans are currently underfunded and we may be required to make cash payments to the plans, reducing our available cash
5. 15Challenges to our pricing or promotional allowance policies or practices could adversely affect our operations
6. 16Climate change and related environmental issues could have a material adverse impact on us

Risks Related to Ownership of Our Common Stock

1. 17There can be no assurance as to the declaration or amount of future dividends
2. 18Our share repurchase program is subject to suspension or termination at any time, and may not enhance long-term stockholder value
3. 19Delaware law and our certificate of incorporation and bylaws contain anti-takeover provisions, any of which could delay or discourage a merger, tender offer or assumption of control of the Company not approved by our Board of Directors that some stockholders may consider favorable