831861--9/14/2006--CONCORD_CAMERA

related topics

{operation, international, foreign}

{capital, credit, financial}

{product, market, service}

{control, financial, internal}

{operation, natural, condition}

{customer, product, revenue}

{acquisition, growth, future}

{cost, operation, labor}

{personnel, key, retain}

{property, intellectual, protect}

{product, candidate, development}

{regulation, change, law}

{tax, income, asset}

{stock, price, operating}

{stock, price, share}

OUR INTERNAL CONTROL OVER FINANCIAL REPORTING MAY BE INSUFFICIENT TO DETECT IN A TIMELY MANNER MISSTATEMENTS THAT COULD OCCUR IN OUR FINANCIAL STATEMENTS IN AMOUNTS THAT MAY BE MATERIAL. THE IMPLEMENTATION OF OUR NEW ERP SYSTEM IN EARLY FISCAL 2005 CONTINUES TO REPRESENT A MATERIAL WEAKNESS IN OUR INTERNAL CONTROL OVER FINANCIAL REPORTING. WE MAY NOT CONTINUE TO MEET NASDAQ LISTING STANDARDS. THE MARKET PRICE OF OUR COMMON STOCK MAY FLUCTUATE AND/OR CONTINUE TO DECLINE. THE EXPIRATION OF OUR PROCESSING AGREEMENT WITH THE PRC WOULD DISRUPT OUR OPERATIONS. WE MAY EXPERIENCE LIQUIDITY ISSUES IF OUR RELIANCE ON FINANCING FACILITIES INCREASES. OUR BUSINESS STRATEGIES MAY NOT SUCCEED. WE MAY NOT BE SUCCESSFUL IN IMPLEMENTING OUR RESTRUCTURING INITIATIVES AND COST-REDUCTION INITIATIVES. IF WE CONTINUE TO INCUR SUBSTANTIAL LOSSES, WE MAY NOT HAVE SUFFICIENT LIQUIDITY TO MEET OUR WORKING CAPITAL NEEDS. WE FACE SIGNIFICANT RISKS RELATED TO THE SINGLE-USE, DIGITAL AND 35MM TRADITIONAL FILM CAMERA MARKETS. WE ARE DEPENDENT ON A SMALL NUMBER OF CUSTOMERS. THE CAMERA AND PHOTOGRAPHIC PRODUCTS INDUSTRY IS HIGHLY COMPETITIVE. DIGITAL CAMERA PRODUCTS ARE SUBJECT TO RAPID TECHNOLOGICAL CHANGES, PRICE EROSION, OBSOLESCENCE AND HIGHER RATES OF RETURNS AND ALLOWANCES. WE DEPEND ON THIRD-PARTY SUPPLIERS, AND OUR REVENUE, GROSS PROFITS AND MARGINS COULD SUFFER IF WE FAIL TO MANAGE SUPPLIER ISSUES PROPERLY. WE ARE DEPENDENT ON THIRD-PARTY SERVICE PROVIDERS TO PROVIDE DISTRIBUTION FACILITIES FOR ALL OF OUR OPERATIONS IN THE UNITED STATES, LATIN AMERICA AND EUROPE. MOST OF OUR OPERATIONS IN THE PRC ARE SUBJECT TO REGULATION BY LOCAL GOVERNMENTAL AGENCIES. WE ARE EXPOSED TO CREDIT RISK ASSOCIATED WITH SALES TO OUR CUSTOMERS. WE ARE EXPOSED TO RISKS ASSOCIATED WITH INTELLECTUAL PROPERTY USED IN OUR PRODUCTS. OUR ABILITY TO MANUFACTURE AND SELL SINGLE-USE CAMERAS DEPENDS ON OUR LICENSING AGREEMENT WITH FUJI. WE ARE EXPOSED TO POLITICAL, ECONOMIC AND OTHER RISKS THAT ARISE FROM OPERATING A MULTINATIONAL BUSINESS. RELOCATION TIME AND EXPENSES COULD RESULT IN SUBSTANTIAL LOSSES. WE ARE EXPOSED TO INTEREST RATE AND EXCHANGE RATE RISK. WE ARE DEPENDENT ON A SMALL GROUP OF KEY PERSONNEL. INTERNATIONAL TRADE RESTRICTIONS COULD ADVERSELY AFFECT OUR BUSINESS AND GROWTH. OUR OPERATIONS MAY BE IMPAIRED AS A RESULT OF DISASTERS, BUSINESS INTERRUPTIONS OR SIMILAR EVENTS. OUR FUTURE INCOME TAX RATES COULD INCREASE. WE MAY NOT BE ABLE TO IDENTIFY AND INTEGRATE FUTURE ACQUISITIONS.

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831861--9/14/2006--CONCORD_CAMERA_CORP