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related topics |
{regulation, government, change} |
{debt, indebtedness, cash} |
{product, liability, claim} |
{personnel, key, retain} |
{competitive, industry, competition} |
{regulation, change, law} |
{acquisition, growth, future} |
{cost, contract, operation} |
{customer, product, revenue} |
{condition, economic, financial} |
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Factors Affecting our Future Prospects
Risks Related to Our Financial Condition
We are highly leveraged. Our substantial indebtedness could limit cash flow available for our operations and could adversely affect our ability to service debt or obtain additional financing if necessary.
Borrowings under our senior secured credit facility and expenses related to the sale of our accounts receivable under our receivables securitization agreements are based upon variable rates of interest, which could result in higher expense in the event of increases in interest rates.
The covenants in our outstanding indebtedness impose restrictions that may limit our operating and financial flexibility.
Risks Related to Our Operations
We need to continue to improve our operations in order to improve our financial condition, but our operations will not improve if we cannot continue to effectively implement our business strategy or if our strategy is negatively affected by general economic conditions.
Our new store and store relocation development program requires entering construction and development commitments and occasionally purchasing land that will not be utilized for several years which may limit our financial flexibility.
We are dependent on our management team, and the loss of their services could have a material adverse effect on our business and the results of our operations or financial condition.
We are substantially dependent on a single supplier of pharmaceutical products to sell products to us on satisfactory terms. A disruption in this relationship may have a negative effect on our results of operations, financial condition and cash flow.
Risks Related to Our Industry
The markets in which we operate are very competitive and further increases in competition could adversely affect us.
Drug benefit plan sponsors and third party payors could change their plan eligibility criteria and further encourage or require the use of mail-order prescriptions which could decrease our sales and reduce our margins and have a material adverse effect on our business.
The availability of pharmacy drugs is subject to governmental regulations.
Changes in third party reimbursement levels for prescription drugs could reduce our margins and have a material adverse effect on our business.
We are subject to governmental regulations, procedures and requirements; our noncompliance or a significant regulatory change could adversely affect our business, the results of our operations or our financial condition.
Certain risks are inherent in providing pharmacy services; our insurance may not be adequate to cover any claims against us.
We will not be able to compete effectively if we are unable to attract, hire and retain qualified pharmacists.
We may be subject to significant liability should the consumption of any of our products cause injury, illness or death.
Full 10-K form ▸
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