Kaiser Aluminum (KALU)

Risks

• The COVID-19 pandemic has impacted and could in the future materially and adversely affect our business.
• The COVID-19 pandemic caused downturns in the commercial aerospace industry and other commercial disruptions, which have adversely affected our business, and could cause additional downturns in the automotive and ground transportation industries, which would further adversely affect our business.
• We operate in a highly competitive industry.
• Reductions in demand for our products may be more severe than, and may occur prior to, reductions in demand for our customers’ products.
• Our customers may reduce their demand for aluminum products in favor of alternative materials.
• Our customers may reduce their demand for our products if the government relaxes fuel efficiency standards or if oil prices remain low for a protracted period of time.
• The commercial aerospace industry is cyclical and downturns in the commercial aerospace industry could adversely affect our business.
• Downturns in the automotive and ground transportation industries could adversely affect our business.
• Changes in consumer demand for particular motor vehicles could adversely affect our business.
• Aluminum beverage and food packaging products are subject to competition from substitute products and decreases in demand, which could result in lower profits and reduced cash flows.
• We depend on a core group of significant customers.
• We are exposed to risks related to our receivables supply chain financing arrangements.
• Our industry is very sensitive to foreign economic, regulatory and political factors that may adversely affect our business.
• We may experience difficulties in the launch or production ramp-up of new products which could adversely affect our business.
• Unplanned events may interrupt our production operations, which may adversely affect our business.
• We may face challenges to our intellectual property rights which could adversely affect our reputation, business and competitive position.
• We may not be able to successfully implement our productivity enhancement and cost reduction initiatives that are necessary to offset competitive price pressure.
• Our investment and other expansion projects may not be completed, start up as scheduled or deliver the expected capacity and other benefits.
• We may not realize the benefits of the Warrick rolling mill acquisition.
• We are dependent upon Alcoa Corporation (“Alcoa”) for certain resources essential to the day-to-day operation of our business at Warrick.
• Our business could be adversely affected by pricing and availability of primary aluminum.
• Our business could be adversely affected by the pricing and availability of recycled scrap aluminum.
• Our business could be adversely affected by the pricing and availability of alloying metals.
• Reduced pricing for aluminum can reduce our borrowing availability and cause our liquidity to decline.
• Our hedging programs have been and could continue to be adversely impacted by fluctuations as a result of the impacts of the COVID-19 pandemic.
• Our hedging programs may limit the income and cash flows we would otherwise expect to receive if our hedging program were not in place and may otherwise affect our business.
• Covenants and events of default in our debt instruments could limit our ability to undertake certain types of transactions and adversely affect our liquidity.
• Restrictive covenants in our debt instruments contain significant qualifications and exceptions.
• Servicing our debt requires a significant amount of cash and we may not have sufficient cash flow from our business to pay our debt.
• The interest rate used in certain of our debt agreements and our customers’ supply chain financing arrangements are priced using LIBOR and are subject to risks associated with the transition from LIBOR to an alternative reference rate.
• We are a holding company and depend on our subsidiaries for cash to meet our obligations and pay any dividends.
• Our failure to maintain satisfactory labor relations could adversely affect our business.
• An adverse decline in the liability discount rate, lower-than-expected investment return on pension assets and other factors could affect our business, financial condition, results of operations or amount of pension funding contributions in future periods.
• The USW has director nomination rights through which it may influence us, and interests of the USW may not align with our interests or the interests of our stockholders, debt holders and other stakeholders.
• Environmental compliance, cleanup and damage claims may decrease our cash flow and adversely affect our business.
• We are subject to risks relating to our information technology systems.
• We may not be able to utilize all of our net operating loss carryforwards.
• We could engage in or approve transactions involving our common shares that impair the use of our federal income tax attributes.
• Payment of dividends may not continue in the future and our payment of dividends and stock repurchases are subject to restrictions.
• Delaware law and our governing documents may impede or discourage a takeover, which could adversely affect the value of our common stock.