Star Group (SGU) risk factors, FY2024 10-K

Other

1. 01Fluctuations in wholesale product costs may have adverse effects on our business, financial condition, results of operations, or liquidity
2. 02higher interest expense as a result of increased working capital borrowing to finance higher receivables and/or inventory balances; and higher bad debt expense and credit card processing costs as a result of higher selling prices
3. 03If, due to supply constraints or shortages, we cannot purchase sufficient quantities of products to meet our customer’s needs, our business and operations will be adversely affected
4. 04If service at our third-party terminals, the common carrier pipelines used or the barge companies we hire to move product is interrupted, our operations would be adversely affected
5. 05The risk of global terrorism, political unrest and war may adversely affect the economy and the price and availability of the products that we sell and have a material adverse effect on our business, financial condition and results of operations
6. 06Our hedging strategy may adversely affect our liquidity
7. 07A significant portion of our home heating oil volume is sold to price-protected customers (ceiling and fixed), and our gross margins could be adversely affected if we are not able to effectively hedge against fluctuations in the volume and cost of product sold to these customers
8. 08We rely on the continued solvency of our wholesale product suppliers and derivatives, insurance and weather hedge counterparties

Risks Related to Customer Attrition, Competition, and Demand for Our Products

1. 09Our operating results will be adversely affected if we continue to experience significant net customer attrition in our home heating oil and propane customer base
2. 10Periods of high wholesale product costs due to energy market volatility and inflation have added to our difficulty in reducing net customer attrition. Warmer than normal weather has also contributed to an increase in attrition as customers perceive less need for a full-service provider like ourselves
3. 11Because of the highly competitive nature of our business, we may not be able to retain existing customers or acquire new customers, which would have an adverse impact on our business, operating results and financial condition
4. 12Energy efficiency and new technology may reduce the demand for our products and adversely affect our operating results
5. 13Our operating results will be adversely affected if we experience significant net customer attrition from conversions to alternative energy products, principally natural gas or electricity
6. 14Customer losses to natural gas conversion and electricity
7. 15If we do not make acquisitions on economically acceptable terms, we will not be able to replace or grow our declining customer base
8. 16Our acquisition activities could result in operational difficulties, unrecoverable costs and other negative consequences, any of which may adversely impact our financial condition and results of operations
9. 17Since weather conditions may adversely affect the demand for home heating oil and propane, our business, operating results and financial condition are vulnerable to warm winters
10. 18Our operating results are subject to seasonal fluctuations
11. 19We face possible risks and costs associated with effects of changes in climate and severe weather

Risks Related to Regulatory and Environmental Matters - See also Item 1 “Business – Government Regulations”

1. 20Federal, state and local legislation in response to climate change has the potential to adversely impact the Company’s operations and reduce demand for our products and services
2. 21Our results of operations and financial condition may be adversely affected by environmental regulations, and regulatory costs
3. 22Changes in tax laws or regulations may have a material adverse effect on our business, cash flow, financial condition or results of operations

Risks Related to Information Technology and Cybersecurity

1. 23We depend on the use of information technology systems that have been and may in the future be a target of cyber-attacks

Risks Related to Our Workforce

1. 24Our inability to identify, hire and retain qualified individuals for our workforce could slow our growth and adversely impact our ability to operate our business
2. 25A substantial portion of our workforce is unionized, and we may face labor actions that could disrupt our operations or lead to higher labor costs and adversely affect our business
3. 26Our obligation to fund multi-employer pension plans to which we contribute may have an adverse impact on us

Risks Related to Ownership of Our Common Units

1. 27Conflicts of interest have arisen and could arise in the future
2. 28The general partner’s affiliates are not prohibited from engaging in other business or activities, including direct competition with us
3. 29Unitholders are deemed to have consented to some actions and conflicts of interest under the Partnership Agreement that might otherwise be deemed a breach of fiduciary or other duties under applicable state law
4. 30The general partner determines whether to issue additional units or other of our securities
5. 31If we fail to maintain an effective system of internal controls, then we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential unitholders could lose confidence in our financial reporting, which would harm our business and the trading price of our common units
6. 32Our unitholder rights plan may discourage potential acquirers of the Company

Risks Related to Our Indebtedness

1. 33Our substantial debt and other financial obligations could impair our financial condition and our ability to obtain additional financing and have a material adverse effect on us if we fail to meet our financial and other obligations
2. 34limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and
3. 35We are not required to accumulate cash for the purpose of meeting our future obligations to our lenders, which may limit the cash available to service the final payment due on the term loan outstanding under our credit agreement
4. 36Our credit agreement contains various covenants that limit our ability and the ability of our subsidiaries to, among other things, incur indebtedness, make distributions to our unitholders, purchase or redeem our outstanding equity interests, sell assets, and engage in other lines of business
5. 37We are subject to operating and litigation risks that could adversely affect our operating results whether or not covered by insurance
6. 38Recessionary economic conditions and rapid inflation could adversely affect our results of operations and financial condition