1750--7/16/2009--AAR

related topics

{competitive, industry, competition}

{condition, economic, financial}

{acquisition, growth, future}

{cost, regulation, environmental}

{cost, operation, labor}

{cost, contract, operation}

{product, liability, claim}

{investment, property, distribution}

{debt, indebtedness, cash}

{product, market, service}

We are impacted by factors that adversely affect the commercial aviation industry. Our customers may not be able to meet their financial obligations to us or we may experience less business as a result of the current airline environment, which would adversely affect our financial condition and results of operations. The market value for our aviation products fluctuates. Acquisitions expose us to risks, including the risk that we may be unable to effectively integrate acquired businesses. Our government contracts may not continue at present sales levels, which may have a material adverse effect on our financial condition and results of operations. We face risks of cost overruns and losses on fixed-price contracts. We may be unable to re-lease or sell aircraft and engines when their current leases expire. Significant cost issues may develop associated with the A400M Cargo system. Success within our Maintenance, Repair and Overhaul segment is dependent upon fleet utilization and continued outsourcing by the airlines. We operate in a highly competitive industry, and competitive pressures may adversely affect us. We are dependent upon continued availability of financing to manage our business and to execute our business strategy, and additional financing may not be available on terms acceptable to us. Our existing debt includes restrictive and financial covenants. We are subject to significant government regulation and may need to incur significant expenses to comply with new or more stringent governmental regulation. Our industry is susceptible to product liability claims, and claims not adequately covered by insurance may adversely affect our financial condition. We must comply with extensive environmental requirements, and any exposure to environmental liabilities may adversely affect us. We may need to make significant capital expenditures to keep pace with technological developments in our industry. Our operations would be adversely affected by a shortage of skilled personnel or work stoppages.

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1750--7/16/2009--AAR_CORP