1750--7/17/2006--AAR_CORP

related topics
{condition, economic, financial}
{acquisition, growth, future}
{cost, regulation, environmental}
{debt, indebtedness, cash}
{competitive, industry, competition}
{cost, contract, operation}
{product, market, service}
{product, liability, claim}
{investment, property, distribution}
{personnel, key, retain}
We may be affected by continuing problems in the aviation industry. Our customers may not be able to meet their financial obligations to us, which would adversely affect our financial condition and results of operations. The market value for our aviation products fluctuates. 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 may be unable to re-lease or sell currently leased aircraft and engines. Our Indianapolis Maintenance Center ( IMC ) is still in the start-up phase and may not be able to capture market share from the competition. 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. Acquisitions expose us to risks, including the risk that we may be unable to effectively integrate acquisitions. 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. We face risks of cost overruns and losses on fixed-price contracts.

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