Acme United (ACU)

Risks

• The Company is subject to a number of significant operational risks that might cause the Company’s actual results to vary materially from its forecasts, targets or projections, including:
• If we identify a material weakness in our internal controls over financial reporting, such material weakness could result in material misstatements in our financial statements.
• Because our products are primarily sold by third parties, our financial results depend in part on the financial health of these parties and any loss of a third-party distributor could adversely affect the Company’s revenues.
• The ability to deliver products to our customers in a timely manner and to satisfy our customers’ fulfillment standards are subject to many factors, some of which are beyond our control. These factors presently include the impact of supply chain issues and the COVID-19 pandemic on the Company.
• Matters relating to the employment market and prevailing wage standards may adversely affect our business.
• The Company’s business is subject to risks associated with seasonality which could adversely affect its cash flow, financial condition, or results of operations.
• Failure to manage growth and continue to expand our operations successfully could adversely affect our financial results.
• Unfavorable shifts in industry-wide demand for the Company’s products could result in inventory valuation risk.
• Loss of a major customer could result in a decrease in the Company’s future sales and earnings.
• The loss of key management could adversely affect the Company’s ability to run its business.
• Execution or the lack thereof, of our e-commerce business may reduce our operating results.
• The Company may not be able to maintain or to raise prices in response to increasing costs or inflation.
• The Company is subject to intense competition in all of the markets in which it competes.
• Compromises of our information systems or unauthorized access to confidential information or our customers' or associates' personal information may materially harm our business or damage our reputation.
• The Company may need to raise additional capital to fund its operations.
• Failure to protect the Company’s proprietary rights or the costs of protecting these rights could adversely affect its business.
• If the Company is found to have infringed the intellectual property rights of others or cannot obtain necessary intellectual property rights from others, its competitiveness could be negatively impaired.
• Product liability claims or regulatory actions could adversely affect the Company's financial results and reputation.
• The Company’s businesses and operations are subject to regulation in the U.S. and abroad.
• Certain or our products and facilities are subject to regulation by the FDA and by analogous foreign regulators.
• The Company is subject to environmental regulation and environmental risks.
• The Company’s operations are increasingly global in nature. Our business, financial condition and results of operations could be adversely affected by the political and economic conditions in the countries in which we conduct business, by fluctuations in currency exchange rates and other factors related to our international operations.
• Reliance on foreign suppliers could adversely affect the Company’s business.
• Continuing uncertainty in the global economy could negatively impact our business.
• Changes in trade policies, including the imposition of tariffs and their enforcement, may have a material adverse impact on our business, results of operations, and outlook.
• The economic effects of the COVID-19 pandemic and measures taken to arrest its spread, as well as measures we have taken and continue to take in response to the pandemic, could adversely impact our business, including our operating results, financial condition and liquidity.
• Vaccine mandates applicable to us could have a material adverse impact on our business and results of operations.
• We cannot provide assurance that we will continue to pay dividends or purchase shares of our common stock under our stock repurchase programs.
• Our shares of common stock are thinly traded and our stock price may be volatile.