EBF Ennis, Inc.

Risks

• Our results and financial condition are affected by global and local market conditions, and competitors’ pricing strategies, which can adversely affect our sales, margins, and net income.
• The terms and conditions of our credit facility impose certain restrictions on our operations. We may not be able to raise additional capital, if needed, for proposed expansion projects.
• Declining financial market conditions and continued decline in long-term interest rates could adversely impact the funded status of our pension plan.
• Our distributor customers may be acquired by other manufacturers who redirect business within their plants.
• We are exposed to the risk of non-payment by our customers on a significant amount of our sales.
• Our business incurs significant freight and transportation costs.
• If our internal controls are found to be ineffective, our financial results or our stock price could be adversely affected.
• Our services depend on the reliability of computer systems we and our vendors maintain. If these systems fail, our operations may be adversely affected.
• We may suffer a data breach of sensitive information, which may result in significant costs to investigate and remediate the breach, litigation expenses and government enforcement actions and penalties, all of which could have an adverse effect on our operations and reputation.
• Increases in the cost of employee benefits could impact our financial results and cash flow.