811596--2/20/2009--KAISER_ALUMINUM

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{tax, income, asset}

{condition, economic, financial}

{cost, regulation, environmental}

{customer, product, revenue}

{cost, operation, labor}

{debt, indebtedness, cash}

{stock, price, operating}

{stock, price, share}

{operation, international, foreign}

{regulation, change, law}

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{product, market, service}

{cost, contract, operation}

{property, intellectual, protect}

{personnel, key, retain}

{acquisition, growth, future}

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{regulation, government, change}

{loss, insurance, financial}

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{operation, natural, condition}

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We depend on a core group of significant customers. Our industry is very sensitive to foreign economic, regulatory and political factors that may adversely affect our business. The aerospace industry is cyclical and downturns in the aerospace industry, including downturns resulting from acts of terrorism, could adversely affect our revenues and profitability. Reductions in defense spending for aerospace and non-aerospace military applications could substantially reduce demand for our products. Our customers may reduce their demand for aluminum products in favor of alternative materials. Further downturns in the automotive and heavy duty truck and trailer industries could adversely affect our net sales and profitability. Changes in consumer demand may adversely affect our operations which supply automotive end users. We face tremendous pressure from our automotive customers on pricing. Because our products are often components of our customers products, reductions in demand for our products may be more severe than, and may occur prior to reductions in demand for, our customers products. Our business is subject to unplanned business interruptions which may adversely affect our performance. Covenants and events of default in our debt instruments could limit our ability to undertake certain types of transactions and adversely affect our liquidity. We depend on our subsidiaries for cash to meet our obligations and pay any dividends. We may not be able to successfully implement our productivity and cost reduction initiatives. Our profitability could be adversely affected by increases in the cost of raw materials and freight. The price volatility of energy costs may adversely affect our profitability. Our hedging programs may limit the income and cash flows we would otherwise expect to receive if our hedging program were not in place. Uncertainty of Anglesey is expected to preclude recognition of future operating results and distribution of dividends. We are exposed to fluctuations in foreign currency exchange rates and interest rates, as well as inflation and other economic factors in the countries in which we operate. Our ability to keep key management and other personnel in place and our ability to attract management and other personnel may affect our performance. Our production costs may increase and we may not sustain our sales and earnings if we fail to maintain satisfactory labor relations. Our business is regulated by a wide variety of health and safety laws and regulations and compliance may be costly and may adversely affect our results of operations. Environmental compliance, clean up and damage claims may decrease our cash flow and adversely affect our results of operations. Other legal proceedings or investigations or changes in the laws and regulations to which we are subject may adversely affect our results of operations. Product liability claims against us could result in significant costs and could adversely affect our financial position, results of operations and cash flow. Our rod, bar, and tube investment projects and other expansion projects may not be completed as scheduled. We may not be able to successfully execute our strategy of growth through acquisitions. Our effective income tax rate could increase and materially adversely affect our business. Exposure to additional income tax liabilities due to audits could materially adversely affect our business. We are exposed to risks relating to evaluations of controls required by Section 404 of the Sarbanes-Oxley Act of 2002. We may not be able to adequately protect proprietary rights to our technology. We may not be able to utilize all of our net operating loss carry-forwards. Transfer restrictions and other factors could hinder the market for our common stock. We could engage in or approve transactions involving our common shares that inadvertently impair the use of our federal income tax attributes. We could engage in or approve transactions involving our common shares that adversely affect significant stockholders. Our net sales, operating results and profitability may vary from period to period, which may lead to volatility in the trading price of our stock. Our annual variable payment obligations to the Union VEBA and Salaried VEBA are linked with our profitability, which means that not all of our earnings will be available to our stockholders. A significant percentage of our stock is held by the Union VEBA which may exert significant influence over us. The USW has director nomination rights through which it may influence us, and USW interests may not align with our interests or the interests of our other investors. Payment of dividends may not continue in the future and our payment of dividends and stock repurchases are subject to restriction.

Full 10-K form ▸

811596--2/20/2009--KAISER_ALUMINUM_CORP