71829--3/16/2007--NEWPARK_RESOURCES

related topics

{product, market, service}

{cost, regulation, environmental}

{operation, international, foreign}

{tax, income, asset}

{cost, contract, operation}

{condition, economic, financial}

{property, intellectual, protect}

{loss, insurance, financial}

{operation, natural, condition}

{control, financial, internal}

{financial, litigation, operation}

{customer, product, revenue}

{personnel, key, retain}

We are subject to legal proceedings that could adversely affect our results of operations, financial condition, liquidity and cash flows. We may not have adequate insurance for potential liabilities. Any significant liability not covered by insurance or exceeding our coverage limits could have a material adverse effect on our financial condition. Shortages of critical equipment and qualified personnel may adversely affect our business. We have identified material weaknesses in our internal control over financial reporting, which, if not remedied effectively, could have an adverse effect on our business and our stock price. We have high levels of goodwill in relation to our total assets and stockholders equity as a result of acquisitions. Any future impairment of goodwill could have a significant impact on our results of operations and financial condition. In the third quarter of 2006, we shut down the operations of Newpark Environmental Water Solutions, LLC, or NEWS, and determined that we would dispose of, sell, or redeploy all of the assets used in connection with its operations. Our failure to shut down the facilities as planned and sell or redeploy the existing equipment and facilities could have a material adverse effect on our consolidated financial statements. The cost of barite recently has been volatile, and this volatility may continue, which may have an adverse effect on our fluid systems and engineering segment. We are subject to risks associated with our international operations that could limit our ability to expand internationally or reduce the revenues and profitability of these operations. We must comply with numerous federal, state and local laws, regulations and policies that govern environmental protection, zoning and other matters applicable to our business. If we fail to comply or these regulations and policies change, we may face fines or other penalties, be forced to make significant capital expenditures or changes to our operations, or lose demand for our services. We face intense competition in our existing markets and expect to face tough competition in any markets into which we seek to expand. Our business exposes us to potential environmental or regulatory liability, and we could be required to pay substantial amounts with respect to these liabilities, including costs to clean up and close contaminated sites. We may not be able to keep pace with the technological developments that characterize the market for our products and services. Our patents or other proprietary technology may not prevent our competitors from developing substantially similar technology, which would reduce any competitive advantages we may have from these patents and proprietary technology. We derive a significant portion of our revenues from a limited number of significant customers. Hurricanes or other adverse weather events could disrupt our operations.

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71829--3/16/2007--NEWPARK_RESOURCES_INC