1133421--2/9/2010--NORTHROP_GRUMMAN_CORP

related topics

{regulation, government, change}

{financial, litigation, operation}

{operation, natural, condition}

{cost, regulation, environmental}

{loss, insurance, financial}

{cost, contract, operation}

{product, candidate, development}

{tax, income, asset}

{operation, international, foreign}

{property, intellectual, protect}

{customer, product, revenue}

{personnel, key, retain}

{product, market, service}

{capital, credit, financial}

{acquisition, growth, future}

{regulation, change, law}

Contracts with the U.S. Government are subject to uncertain levels of funding, modification due to changes in customer priorities and potential termination. As a U.S. Government contractor, we are subject to a number of procurement regulations and could be adversely affected by changes in regulations or any negative findings from a U.S. audit or investigation. Competition within our markets and an increase in bid protests may reduce our revenues and market share. Our future success depends, in part, on our ability to develop new products and new technologies and maintain a qualified workforce to meet the needs of current and future customers. Many of our contracts contain performance obligations that require innovative design capabilities, are technologically complex, require state-of-the-art manufacturing expertise or are dependent upon factors not wholly within our control. Failure to meet these obligations could adversely affect our profitability and future prospects. Contract cost growth on fixed-price and other contracts that cannot be justified as an increase in contract value due from customers exposes us to reduced profitability and the potential loss of future business. Our earnings and margins depend, in part, on our ability to perform under contracts and on subcontractor performance as well as raw material and component availability and pricing. Our business is subject to disruption caused by natural disasters and other factors that could adversely affect our profitability and our overall financial position. We use estimates when accounting for contracts. Changes in estimates could affect our profitability and our overall financial position. Our international business is subject to greater risks sometimes associated with doing business in foreign countries. Our reputation and our ability to do business may be impacted by the improper conduct of employees, agents or business partners. Our business could be negatively impacted by security threats and other disruptions. Our nuclear operations subject us to various environmental, regulatory, financial and other risks. Unforeseen environmental costs could have a material adverse effect on our financial condition or results of operations. We are subject to various claims and litigation that could ultimately be resolved against us requiring material future cash payments and/or future material charges against our operating income and materially impairing our financial position. We may be unable to adequately protect our intellectual property rights, which could affect our ability to compete. Our insurance coverage may be inadequate to cover all of our significant risks or our insurers may deny coverage of material losses we incur, which could adversely affect our profitability and overall financial position. Changes in future business conditions could cause business investments and/or recorded goodwill to become impaired, resulting in substantial losses and write-downs that would reduce our operating income. Anticipated benefits of mergers, acquisitions, joint ventures or strategic alliances may not be realized. Market volatility and adverse capital and credit market conditions may affect our ability to access cost-effective sources of funding and expose us to risks associated with the financial viability of suppliers and the ability of counterparties to perform on financial instruments.

Full 10-K form ▸

1133421--2/9/2010--NORTHROP_GRUMMAN_CORP_/DE/