1116030--3/13/2006--HYDRIL

related topics

{customer, product, revenue}

{cost, regulation, environmental}

{operation, natural, condition}

{personnel, key, retain}

{product, market, service}

{gas, price, oil}

{property, intellectual, protect}

{stock, price, operating}

{condition, economic, financial}

{competitive, industry, competition}

{financial, litigation, operation}

We rely on a few distributors for sales of our premium connections in the United States and Canada; a loss of one or more of our distributors or a change in the method of distribution could adversely affect our ability to sell our products. Consolidation or loss of end-users of our products could adversely affect demand for our products and services and reduce our revenue. We may lose money on fixed price contracts, which currently constitute a significant part of our business, and such contracts could cause our quarterly revenue and earnings to fluctuate significantly. Intense competition in our industry could result in reduced profitability and loss of market share for us. A material or extended decline in expenditures by the oil and gas industry, due to a decline in oil and gas prices or other economic factors, would reduce our revenue. Our international operations may experience severe interruptions due to political, economic and other risks. If we are unable to attract and retain skilled labor, the results of our manufacturing and services activities will be adversely affected. The occurrence or threat of terrorist attacks could have an adverse affect on our results and growth prospects, as well as on our ability to access capital and obtain adequate insurance. High fixed costs in the pressure control industry could exacerbate the level of price competition for our products, adversely affecting our business and revenue. If we do not develop new technologies and products that are commercially successful, our revenue may decline or we may be required to write-off any capitalized investment. Limitations on our ability to protect our intellectual property rights could cause a loss in revenue and any competitive advantage we hold. The loss of any member of our senior management and other key employees may adversely affect our results of operations. Our quarterly sales and earnings may vary significantly, which could cause our stock price to fluctuate. We could be subject to substantial liability claims, which would adversely affect our results and financial condition. Changes in regulation or environmental compliance costs and liabilities could have a material adverse effect on our results and financial condition. We could become subject to claims related to the release of hazardous substances which could adversely affect our results and financial condition.

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1116030--3/13/2006--HYDRIL_CO