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Financial report summary
?Risks
- Our operations may be subject to certain risks.
- We may experience fluctuations in quarterly results of operations.
- We are exposed to general economic conditions, which could have a material adverse impact on our business, operating results and financial condition.
- The majority of our sales come from a small number of customers and a decline in sales to any of these customers could adversely affect our business.
- We depend on a limited number of suppliers for certain components that are critical to our manufacturing processes. A shortage of these components or an increase in their price could interrupt our operations and result in a significant change in our results of operations.
- We operate in a highly competitive industry; if we are not able to compete effectively in the contract manufacturing industry, our business could be adversely affected.
- Our success will continue to depend to a significant extent on our key personnel.
- Start-up costs and inefficiencies related to new or transferred programs can adversely affect our operating results and such costs may not be recoverable if such new programs or transferred programs are canceled or don’t meet expected sales volumes.
- Customers may change production timing and demand schedules which makes it difficult for us to schedule production and capital expenditures and to maximize the efficiency of our manufacturing capacity.
- Compliance or the failure to comply with current and future environmental and health laws or regulations could cause us significant expense.
- If our manufacturing processes and services do not comply with applicable statutory and regulatory requirements, or if we manufacture products containing design or manufacturing defects, demand for our services may decline and we may be subject to liability claims.
- If we do not manage our growth effectively, our profitability could decline.
- Energy price increases may negatively impact our results of operations.
- Our operations are subject to cyberattacks that could have a material adverse effect on our business.
- Disruptions to our information systems, including losses of data or outages, could adversely affect our operations.
- If we are unable to maintain our technological and manufacturing process expertise, our business could be adversely affected.
- Our ability to secure and maintain sufficient credit arrangements is key to our continued operations.
- An adverse change in the interest rates for our borrowings could adversely affect our financial condition.
- Our stock price is volatile.
- If we fail to maintain proper and effective internal controls, our business and financial condition could be materially adversely impacted.
- Matters relating to or arising from the subject of the Audit Committee’s internal investigation, including expenses and diversion of personnel and resources, regulatory investigations, and proceedings and litigation matters, could have an adverse effect on our business, results of operations and financial condition.
- Due to inherent limitations, there can be no assurance that our system of disclosure and internal controls and procedures will be successful in preventing all errors, theft and fraud, or in informing management of all material information in a timely manner.
- We are involved in various legal proceedings.
- Changes in securities laws and regulations will increase our costs and risk of noncompliance.
- Changes in financial accounting standards may affect our reported financial condition or results of operations as well as increase costs related to implementation of new standards and modifications to internal controls.
- Our levels of insurance coverage may not be sufficient for potential damages, claims or losses.
- We may encounter complications with acquisitions, which could potentially harm our business.
Management Discussion
- The financial information and discussion below should be read in conjunction with the Consolidated Financial Statements and Notes.
- Net sales of $145.4 million for the second quarter of fiscal year 2024 increased by 17.5 percent as compared to net sales of $123.7 million for the second quarter of fiscal year 2023.
- The $21.7 million increase in net sales from the prior year period was primarily due to the successful ramp of new customer programs and increased component sales for a large customer. However, the Company’s revenue was constrained by tightening worldwide supply chain and transportation and logistics issues.