What changed in this filing

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Item 1A. Risk Factors

2021-11-18 compared with 2020-11-19 · 151 added, 107 removed, 309 unchanged (46% of the section changed)

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Risks Related to Our Business

Our business is affected by general business and economic conditions, which could materially and adversely affect our business, financial position, results of operations or cash flows.

Demand for our products is affected by a number of general business and economic conditions.

A decline in the United States and international markets in which we operate could materially and adversely affect our business, financial position, results of operations or cash flows.

Our profit margins, as well as overall demand for our products, could decline as a result of a large number of factors beyond our control, including economic recessions, the COVID-19 pandemic, changes in end-user preferences, consumer confidence, inflation, availability of credit, fluctuation in interest and currency exchange rates and changes in the fiscal or monetary policies of governments in the regions in which we operate.

Our performance may be impacted by general business and economic conditions, which could materially and adversely affect our business, financial position, results of operations or cash flows.

The success of our business is affected by a number of general business and economic conditions.

Our primary end markets are new non-residential construction, repair and remodel (“MR&R”), residential, OEM, and international markets.

Decrease in global economic activity may result in downturns or periods of economic weakness in our primary end markets.

Such decreases may be instigated by factors beyond our control, including economic recessions, the COVID-19 pandemic, supply chain disruptions, availability of raw materials and other items sourced for production and delivery of finished product, changes in end-user preferences, consumer confidence, inflation, availability of credit, fluctuations in interest and currency exchange rates and changes in the fiscal or monetary policies of governments in the regions in which we operate.

In turn, we may experience diminished demand for our products, which could create excess capacity and reduce the prices which we are able to charge for our products.

The materialization of any of these risks could have a material adverse effect on our business, financial position, results of operations and cash flows.

During the United States economic recession which began in the second half of 2007 and continued through June of 2009, demand for our products declined significantly.

Another economic downturn in any of the markets we serve may result in a reduction of sales and pricing for our products.

Any such economic downturn could also adversely affect the creditworthiness of our customers.

If the creditworthiness of our customers declines, we could face increased credit risk and some, or many, of our customers may not be able to pay us amounts when they become due.

Economic downturns may also result in restructuring actions and associated expenses and the impairment of long-lived assets, including goodwill and other intangibles.

In particular, we may be forced to close underperforming facilities.

Any such restructuring actions, combined with reduced demand and excess capacity, could negatively impact our business, financial position, results of operations or cash flows.

We cannot predict economic conditions, or the timing or strength of demand in our markets.

Weakness in the markets in which we operate could have a material adverse effect on our business, financial condition, results of operations or cash flows.

We may have to close underperforming facilities from time to time and market weakness will reduce demand for our products, possibly lead to excess capacity and may also reduce the price we are able to charge for our products.

This, combined with an increase in excess capacity, could negatively impact our business, financial condition, results of operations or cash flows.

Weakness in the markets in which we operate could have a material adverse effect on our business, financial position, results of operations or cash flows.

The non-residential construction industry accounts for a significant portion of our business, and a downturn in the non-residential construction industry could materially and adversely affect our business, financial position, results of operations or cash flows.

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United States non-residential construction starts, as reported by Dodge, reached a historic low of 690 million square feet in our fiscal 2010 and increased to 1,243 million square feet in our fiscal 2021, which remains below historical levels.

From time to time we have been adversely affected in various parts of the country by declines in non-residential building construction starts due to, among other things, changes in tax laws affecting the real estate industry, interest rate increases and governmental restrictions relating to the COVID-19 pandemic.

Continued uncertainty about current economic conditions will continue to pose a risk to our business, financial position, results of operations and cash flows, as participants in this industry may postpone spending in response to negative financial news and/or declines in income or asset values, which could have a continued material negative effect on the demand for our products.

Widespread detrimental public health conditions, and specifically the pandemic caused by the spread of COVID-19, have had and could continue to have a material adverse impact on our business, financial position, results of operations and cash flows.

From time to time we have been adversely affected in various parts of the country by declines in non-residential building construction starts due to, among other things, supply chain disruptions and availability of construction labor and materials, changes in tax laws affecting the real estate industry, interest rate increases and governmental restrictions relating to the COVID-19 pandemic.

Continued uncertainty about current economic conditions will continue to pose a risk to our business, financial position, results of operations and cash flows, as participants in this industry may postpone spending in response to negative financial news or declines in income or asset values, which could have a continued material negative effect on the demand for our products.

Widespread public health conditions, and specifically the COVID-19 pandemic, have had and could continue to have a material adverse impact on our business, financial position, results of operations and cash flows.

We are closely monitoring developments related to the COVID-19 pandemic to assess its impact on our business.

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These impacts include disruptions or restrictions on our employees’ ability to travel as well as temporary closures of our facilities or the facilities of our customers, suppliers and other constituents of our supply chain.

While still evolving, the COVID-19 pandemic has caused significant economic and financial turmoil both in the United States and around the world, and has led to a global recession.

These conditions are expected to continue in the near term.

As of the date of this filing, we have seen volume declines in our business across several product categories, as customers and end markets face some uncertainty and delays in timing of work.

In particular, some construction site closures or project delays have occurred, and job sites have had to adjust to increased physical distancing and health-related precautions.

In particular, some construction site closures or project delays have occurred, and job sites have had to adjust to increased physical distancing, and shortages of labor and construction materials and health-related precautions.

Given the continued uncertainty with respect to impacts of the pandemic, it is unknown how significant this will become.

Further uncertainty and delays in our end-markets could have a material adverse impact on the demand for our products, some jurisdictions may raise taxes to help cover pandemic-related costs and disruptions to or adverse conditions in the financial industry could affect our ability to obtain financing on favorable terms or at all.

While our operations are currently considered an “essential business”, the extent and duration of the impact of the COVID-19 pandemic remain highly uncertain and dependent on future developments that cannot be accurately predicted, such as the severity of the COVID-19 pandemic, the extent and effectiveness of containment actions, and the impacts of these and other factors on our operations and the global economy.

While our operations are currently considered an “essential business”, the extent and duration of the COVID-19 pandemic’s impact remain highly uncertain and dependent on future developments that cannot be accurately predicted, such as the availability and effectiveness of vaccines, future mutations of the COVID-19 virus and any resulting impact of the effectiveness of vaccines, the severity of the COVID-19 pandemic, the extent and effectiveness of containment actions, and the impacts of these and other factors on our operations and the global economy.

We also cannot predict how legal and regulatory responses to concerns about the COVID-19 pandemic and related public health issues will impact our business.

These and other factors could have a material adverse impact on our business, financial position, results of operations and cash flows and may cause us to revisit or revise estimates of future earnings or other guidance we have previously provided to the markets.

Furthermore, the heightened uncertainty within the macroeconomic environment has caused our stock price to decline and may cause our stock price to be highly volatile and decline further in the future, due in part to the volatility of the stock market and any general economic downturn.

The raw materials on which we depend in our production process may be subject to price increases which we may not be able to pass through to our customers, or to price decreases which may decrease the price levels of our products.

Furthermore, the heightened uncertainty within the macroeconomic environment has caused our stock price to be volatile which could include declines in the future, due in part to the volatility of the stock market and any general economic downturn.

As a result, such price fluctuations could materially and adversely affect our business, financial position, results of operations or cash flows.

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We may not always be completely successful in managing raw material market fluctuations in the future.

In addition, in periods of declining prices for our raw materials we may face pricing pressure from our customers.

We generally sell our products on a spot basis (and not under long-term contracts).

Any increase in raw material prices that is not offset by an increase in our prices, or our inability to maintain price levels in an environment of declining raw material prices, could materially and adversely affect our business, financial position, results of operations or cash flows.

Accordingly, in periods of declining raw material prices, we may face pricing pressure from our customers to reduce our products’ prices.

Conversely, in periods of increasing raw material prices, we may not be able to pass on such increases to our customers.

Our inability to maintain established price levels in an environment of declining raw material prices, or offset increasing raw material prices by our products’ prices, could materially and adversely affect our business, financial position, results of operations or cash flows.

We operate in a competitive landscape, and increased competition could materially and adversely affect our business, financial position, results of operations or cash flows.

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Our business, financial position, results of operations or cash flows could be materially and adversely affected if we are unable to pass all of the cost increases on to our customers, if we are unable to obtain the necessary energy supplies or if freight carrier capacity in our geographic markets were to decline significantly or otherwise become unavailable.

Our business, financial position, results of operations or cash flows could be materially and adversely affected by the level of similar product imports into the United States, as well as U.S.

Interruptions in the proper functioning of our information technology (“IT”) systems, including from cybersecurity threats, could disrupt operations and cause unanticipated increases in costs or decreases in revenues, or both.

We use our IT systems to, among other things, run and manage our manufacturing operations, manage inventories and accounts receivable, make purchasing decisions and monitor our results of operations, and process, transmit and store sensitive electronic data, including employee, supplier and customer records.

As a result, the proper functioning of our IT systems is critical to the successful operation of our business.

Our information systems include proprietary systems developed and maintained by us.

In addition, we depend on IT systems of third parties, such as suppliers, retailers and OEMs to, among other things, market and distribute our products, develop new products and services, operate our website, host and manage our services, store data, process transactions, respond to customer inquiries and manage inventory and our supply chain.

Although our IT systems are protected through physical and software safeguards and remote processing capabilities exist, our IT systems or those of third parties whom we depend upon are still vulnerable to natural disasters, power losses, unauthorized access, telecommunication failures and other problems.

If critical proprietary or third-party IT systems fail or are otherwise unavailable, including as a result of system upgrades and transitions, our ability to manufacture, process orders, track credit risk, identify business opportunities, maintain proper levels of inventories, collect accounts receivable, pay expenses and otherwise manage our business would be adversely affected.

Our business is also vulnerable to cyberattacks.

Cyber incidents can result from deliberate attacks or unintentional events.

Cybersecurity attacks in particular are becoming more sophisticated and more frequent and include, but are not limited to, malicious software, attempts to gain unauthorized access to data (either directly or through our vendors) for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption, “denial of service” attacks, phishing, untargeted but sophisticated and automated attacks and other disruptive software campaigns.

We have been, and likely will continue to be, subject to potential damage from cybersecurity attacks.

Despite our security measures, our IT systems and infrastructure or those of our third parties may be vulnerable to such cyber incidents.

The result of these incidents could include, but are not limited to, disrupted operations, misstated or misappropriated financial data, theft of our intellectual property or other confidential information (including of our customers, suppliers and employees), liability for stolen assets or information, increased cyber security protection costs and reputational damage adversely affecting customer or investor confidence.

In addition, if any information about our customers, including payment information, were the subject of a successful cybersecurity attack against us, we could be subject to litigation or other claims by the affected customers.

We have incurred costs and may incur significant additional costs in order to implement the security measures we feel are appropriate to protect our IT systems.

Our business, financial position, results of operations or cash flows could be materially and adversely affected by the importation of similar products into the United States, as well as U.S.

trade policy and practices.

A substantial portion of our revenue is generated through our operations in the United States.

Although we have not been substantially impacted by imports historically, imports of products similar to those manufactured by us may reduce the volume of products sold by domestic producers and depress the selling prices of our products and those of our competitors.

Imports of products similar to those manufactured by us may reduce the volume of products sold by domestic producers and depress the selling prices of our products and those of our competitors.

We believe import levels are affected by, among other things, overall worldwide product demand, the trade practices of the U.S.

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We are indirectly subject to regulatory changes that may affect demand for our products.

The market for certain of our products is influenced by federal, state, local and international governmental regulations and trade policies (such as the Buy America regulations, American Recovery and Reinvestment Act of 2009, Underwriters Laboratories, National Electric Code and American Society of Mechanical Engineers) as well as other policies, including those imposed on the non-residential construction industry (such as the National Electrical Code and corresponding state and local laws based on the National Electrical Code).

The markets for certain of our products are influenced by federal, state, local and international governmental regulations, trade policies and trade groups (such as the Buy America regulations, American Recovery and Reinvestment Act of 2009, Underwriters Laboratories, National Electrical Code and American Society of Mechanical Engineers) as well as other policies, including those imposed on the non-residential construction industry (such as the National Electrical Code and corresponding state and local laws based on the National Electrical Code).

These regulations and policies are subject to change.

In the event that there would be changes in the National Electrical Code and any similar state, local or non-U.S.

laws, including changes that would allow for alternative products to be used in the non-residential construction industry or that would render less restrictive or otherwise reduce the current requirements under such laws and regulations, the scope of products that would serve as alternatives to products we produce would increase.

Any changes to such regulations, laws and policies could materially and adversely affect our business, financial position, results of operations or cash flows.

Specifically, changes to the National Electrical Code and any similar state, local or non-U.S.

laws, including changes that would allow for alternative products to be used in the non-residential construction industry or that would render less restrictive or otherwise reduce the current requirements under such laws and regulations, could expand the scope of products which could serve as alternatives to our products.

As a result, competition in the industries in which we operate could increase, with a potential corresponding decrease in the demand for our products.

To remain competitive, we may be forced to reduce the prices of our products.

In addition, in the event that changes in such laws would render current requirements more restrictive, we may be required to change our products or production processes to meet such increased restrictions, which could result in increased costs and cause us to lose market share.

Any changes to such regulations, laws and policies could materially and adversely affect our business, financial position, results of operations or cash flows.

The materialization of any of these risks may have a material adverse effect on our business, financial position, results of operations or cash flows.

Our results of operations could be adversely affected by weather.

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If hurricanes, severe storms, floods, other natural disasters or similar events occur in the geographic regions in which we or our suppliers operate or through which deliveries must travel, our results of operations may be adversely affected.

We have incurred and continue to incur significant costs to comply with current and future environmental, health and safety laws and regulations, and our operations expose us to the risk of material environmental, health and safety liabilities and obligations.

We have incurred and continue to incur significant costs to comply with current and future environmental and health and safety laws and regulations, and our operations expose us to the risk of material environmental and health and safety laws liability.

We are subject to numerous federal, state, local and non-U.S.

environmental, health and safety laws governing, among other things, the generation, use, storage, treatment, transportation, disposal and management of hazardous substances and wastes, emissions or discharges of pollutants or other substances into the environment, investigation and remediation of, and damages resulting from, releases of hazardous substances and the health and safety of our employees.

We have incurred, and expect to continue to incur, capital expenditures in addition to ordinary course costs to comply with applicable current and future environmental, health and safety laws, such as those governing air emissions and wastewater discharges.

environmental laws governing, among other things, the generation, use, storage, treatment, transportation, disposal and management of hazardous substances and wastes, emissions or discharges of pollutants or other substances into the environment, investigation and remediation of, and damages resulting from, releases of hazardous substances.

Our failure to comply with applicable environmental laws, regulations and permit requirements could result in civil or criminal fines or penalties, enforcement actions, and regulatory or judicial orders enjoining or curtailing operations or requiring corrective measures such as the installation of pollution control equipment, which could materially and adversely affect our business, financial position, results of operations or cash flows.

Accordingly, compliance with these laws, regulations, permits and approvals is a significant factor in our business.

We have incurred, and expect to continue to incur, capital expenditures in addition to ordinary course costs to comply with applicable current and future environmental laws, such as those governing air emissions and wastewater discharges.

These laws are subject to change, which could be frequent and material.

The imposition of more stringent federal, state or local environmental rules or regulations could increase our operating costs and expenses.

In addition, government agencies could impose conditions or other restrictions in our environmental permits which increase our costs.

These laws are subject to change, which can be frequent and material.

More stringent federal, state or local environmental rules or regulations could increase our operating costs and expenses.

Furthermore, our operations are governed by the United States Occupational Safety and Health Administration, or "OSHA." OSHA regulations may change in a way that increases our costs of operations.

Our failure to comply with applicable environmental, health and safety laws and permit requirements could result in civil or criminal fines or penalties, enforcement actions, and regulatory or judicial orders enjoining or curtailing operations or requiring corrective measures such as the installation of pollution control equipment, which could materially and adversely affect our business, financial position, results of operations or cash flows.

From time to time, we may be held liable for the costs to address contamination at any real property we have ever owned, operated or used as a disposal site.

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For example, as we sell, close or otherwise dispose of facilities, we may need to address environmental issues at such sites, including any previously unknown contamination.

We could be subject to third-party claims for property damage, personal injury and nuisance or otherwise as a result of violations of, or liabilities under, environmental, health or safety laws or in connection with releases of hazardous or other materials at any current or former facility.

We could be subject to third-party claims for property damage and nuisance or otherwise as a result of violations of, or liabilities under, environmental laws or in connection with releases of hazardous or other materials at any current or former facility.

We could also be subject to environmental indemnification or other claims in connection with assets and businesses that we have divested.

We are also subject to various federal, state, local and foreign requirements concerning health and safety conditions at our manufacturing facilities, including those promulgated by the U.S.

Occupational Safety and Health Administration (“OSHA”).

The operation of manufacturing facilities involves many risks, including the failure or substandard performance of equipment, suspension of operations and new governmental statues, regulations, guidelines and policies.

Our and our customers’ operations are also subject to various hazards incidental to the production, use, handling, processing, storage and transportation of certain hazardous materials.

These hazards can cause personal injury, severe damage to and destruction of property and equipment and environmental damage.

Furthermore, we may become subject to claims with respect to workplace exposure, personal injury, workers’ compensation and other matters.

We may be subject to material financial penalties or liabilities for noncompliance with health and safety requirements, as well as potential business disruption, if any of our facilities or a portion of any facility is required to be temporarily closed as a result of any significant injury or any noncompliance with applicable requirements.

Moreover, we have sustained capital expenditure in complying with applicable health and safety laws and regulations, and any changes to such laws and regulations could increase our costs of operations.

We cannot assure you that any costs relating to future capital and operating expenditures to maintain compliance with environmental, health and safety laws, as well as costs to address contamination or environmental claims, will not exceed any current estimates or adversely affect our business, financial position, results of operations or cash flows.

In addition, any unanticipated liabilities or obligations arising, for example, out of discovery of previously unknown conditions or changes in law or enforcement policies, could materially and adversely affect our business, financial position, results of operations or cash flows.

We rely on a few customers for a significant portion of our net sales, and the loss of those customers or their inability or unwillingness to pay our invoices on time could materially and adversely affect our business, financial position, results of operations or cash flows.

Any unanticipated liabilities or obligations arising, for example, out of discovery of previously unknown conditions or changes in law or enforcement policies, could materially and adversely affect our business, financial position, results of operations or cash flows.

We rely on several customers for a significant portion of our net sales, and the loss of such customers, or their inability or unwillingness to pay our invoices on time could materially and adversely affect our business, financial position, results of operations or cash flows.

Certain of our customers, in particular buying groups representing consortia of independent electrical distributors, national electrical distributors, OEMs, data centers and medical center general contractors are material to our business, financial position, results of operations and cash flows because they account for a significant portion of our net sales.

In fiscal 2021, although no single customer accounted for more than 10% of our net sales, our ten largest customers (including buyers and distributors in buying groups) accounted for approximately 37% of our net sales.

Our percentage of sales to our major customers may increase if we are successful in pursuing our strategy of broadening the range of products we sell to existing customers.

Our percentage of sales to our major customers may increase if we are successful in our strategy of expanding the range of products which we sell to existing customers.

In such an event, or in the event of any consolidation in certain segments we serve, including retailers selling building products, our sales may be increasingly sensitive to deterioration in the financial condition of, or other adverse developments with respect to, one or more of our top customers.

Our top customers may also be able to exert influences on us with respect to pricing, delivery, payment or other terms.

Any termination of a business relationship with, or a significant sustained reduction in business received from, one or more of our largest customers could have a material adverse effect on our business, financial position, results of operations or cash flows.

The majority of our net sales are facilitated through the extension of credit to our customers, and a significant asset included in our working capital is accounts receivable from customers.

As of September 30, 2021, CED National represented 11% of the Company’s accounts receivable, with no significant amounts past due.

As of September 30, 2020, one customer, Sonepar Management US, Inc., represented 11% of the Company’s accounts receivable balance due to increased sales in the last 60 days of the year.

As of September 30, 2019, no single customer represented more than 10% of the Company's accounts receivable balance.

See Note 17, “Segment Information” to the accompanying consolidated financial statements included elsewhere in this Annual Report.

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We require significant working capital to purchase these raw materials and sell our products efficiently and profitably to our customers.

We are typically obligated to pay for our raw material purchases within 10 and 60 days of receipt, while we generally collect cash from the sale of manufactured products between 30 to 60 days from the point at which title and risk of loss transfers.

Our cash collection cycle is generally one to two months longer than our cash payment cycle.

If our working capital requirements increase and we are unable to finance our working capital on terms and conditions acceptable to us, we may not be able to obtain raw materials to respond to customer demand, which could result in a loss of sales.

Our average working capital days during fiscal 2020 was 79 days.

If our working capital needs increase, the amount of liquidity we have at our disposal to devote to other uses will decrease.

A decrease in liquidity could, among other things, limit our flexibility, including our ability to make capital expenditures and to complete acquisitions that we have identified, thereby materially and adversely affecting our business, financial condition, results of operations and cash flows.

Work stoppages and other production disruptions may adversely affect our operations and impair our financial performance.

Labor disputes, increased labor costs or work stoppages could adversely affect our operations and impair our financial performance.

As of September 30, 2021, approximately 21% of our domestic and international employees were represented with a collective bargaining agreement by labor unions.

A work stoppage or other interruption of production could occur at our facilities or our suppliers' facilities as a result of disputes under existing collective bargaining agreements with labor unions or in connection with negotiations of new collective bargaining agreements, as a result of supplier financial distress, or for other reasons.

Such work stoppages or interruptions could materially and adversely affect our business, financial position, results of operations or cash flows.

Work stoppages or production interruptions could occur at our facilities or our suppliers’ facilities.

Such disputes may arise under existing collective bargaining agreements with labor unions or in connection with negotiations of new collective bargaining agreements, as a result of supplier financial distress or for other reasons.

Any amendments to existing collective bargaining agreements, or the implementation of new collective bargaining agreements, could result in increased labor costs.

Any organizing efforts, significant work stoppages or increases in labor costs could materially and adversely affect our business, financial position, results of operations or cash flows.

See Item 1, “Business—Human Capital Resources.”

Our business requires skilled labor, and we may be unable to attract and retain qualified employees.

The Company’s success is dependent on our employees, so it’s critical that we continue to attract and retain talent.

To accomplish this, the Company needs to offer a total rewards package that includes competitive benefits and pay, reflecting our long-term commitment to the well-being of our employees.

Efforts to attract talent to fill open roles in light of recent constrained labor availability may take more time than in the past and may cost the Company significantly more than in recent years.

Moreover, the constrained labor conditions may mean that retention of existing talent may require significant additional pay and incentives.

We have financial obligations relating to pension plans that we maintain in the United States.

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If in any year our assumptions are inaccurate, we could be required to expend greater amounts than anticipated.

Unplanned outages at our facilities and other unforeseen disruptions could materially and adversely affect our business, financial position, results of operations or cash flows.

Our business depends on the operation of our manufacturing and distribution facilities.

It is possible that we could experience prolonged periods of reduced production or distribution capacity due to interruptions in the operations of our facilities or those of our key suppliers.

Unplanned outages at our facilities or those of our suppliers and other unforeseen disruptions could materially and adversely affect our business, financial position, results of operations or cash flows.

Our business depends on the operation of our manufacturing and distribution facilities as well as those of our suppliers.

It is possible that we or they could experience prolonged periods of reduced production or distribution capacity due to interruptions in the operations of our facilities or those of our key suppliers.

It is also possible that operations may be disrupted due to other unforeseen circumstances such as power outages, explosions, fires, floods, accidents, effects of the pandemic and severe weather conditions.

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We rely on the efforts of agents and distributors to generate sales of our products.

We utilize various third-party agents and distributors to market, sell and distribute our products and to directly interface with our customers and end-users by providing customer service and support.

We utilize various third-party agents and distributors to market, sell and distribute our products and to directly interact with our customers and end-users by providing customer service and support.

No single agent or distributor accounts for a material percentage of our annual net sales.

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The loss of a substantial number of our third-party agents or distributors or a dramatic deviation from the amount of sales they generate, including due to an increase in their sales of our competitors’ products, could reduce our sales and could materially and adversely affect our business, financial position, results of operations or cash flows.

Interruptions in the proper functioning of our information technology, or "IT" systems, including from cybersecurity threats, could disrupt operations and cause unanticipated increases in costs or decreases in revenues, or both.

We use our information systems to, among other things, run and manage our manufacturing operations, manage inventories and accounts receivable, make purchasing decisions and monitor our results of operations, and process, transmit and store sensitive electronic data, including employee, supplier and customer records.

As a result, the proper functioning of our IT systems is critical to the successful operation of our business.

Our information systems include proprietary systems developed and maintained by us.

Cyber incidents can result from deliberate attacks or unintentional events.

These incidents can include, but are not limited to, gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption.

Cybersecurity attacks in particular are becoming more sophisticated and more frequent and include, but are not limited to, malicious software, attempts to gain unauthorized access to data (either directly or through our vendors) and other cybersecurity attacks such as "denial of service" attacks, phishing, untargeted but sophisticated and automated attacks, and other disruptive software campaigns.

We have been, and likely will continue to be, subject to potential damage from cybersecurity attacks.

Despite our security measures, our IT systems and infrastructure or those of our third parties may be vulnerable to such cyber incidents.

We have incurred costs and may incur significant additional costs in order to implement the security measures we feel are appropriate to protect our IT systems.

We may be required to recognize goodwill, intangible assets or other long-lived asset impairment charges.

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Goodwill and indefinite-lived intangible assets are not amortized and are subject to impairment testing at least annually.

Future events, such as declines in our cash flow projections or customer demand, may cause impairments of our goodwill or long-lived assets based on factors such as the price of our common stock, projected cash flows, assumptions used, control premiums or other variables.

In addition, if we divest long-lived assets at prices below their asset value, we must write them down to fair value resulting in long-lived asset impairment charges, which could adversely affect our financial position or results of operations.

For example, in fiscal 2015 we recorded asset impairments of $27.9 million primarily related to our announced Fence and Sprinkler exit.

See Note 12, “Goodwill and Intangible Assets” to the accompanying consolidated financial statements included elsewhere in this Annual Report.

We cannot accurately predict the amount and timing of any impairment of assets, and we may be required to recognize goodwill or other asset impairment charges which could materially and adversely affect our results of operations.

See " Item 8.

Financial Statements and Supplementary Data”.

We are subject to certain safety and labor risks associated with the manufacture and testing of our products.

We are subject to certain safety and labor risks associated with the manufacturing and testing of our products.

As of September 30, 2021, we employed approximately 4,000 total full-time equivalent employees, a significant percentage of whom work at our 42 manufacturing facilities.

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The outcome of any personal injury, wrongful death or other litigation is difficult to assess or quantify and the cost to defend litigation can be significant.

As a result, the costs to defend any action or the potential liability resulting from any such accident or death or arising out of any other litigation, and any negative publicity associated therewith or negative effects on employee morale, could have a negative effect on our business, financial position, results of operations or

In addition, any accident could result in manufacturing or product delays, which could negatively affect our business, financial position, results of operations or cash flows.

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Additionally, defending against these lawsuits and proceedings may involve significant expense and diversion of management’s attention and resources from other matters.

We may not be able to adequately protect our intellectual property rights in foreign countries, and we may become involved in intellectual property disputes.

We may not be able to adequately protect our intellectual property rights, and we may become involved in intellectual property disputes.

Our use of contractual provisions, confidentiality procedures and agreements, and patent, trademark, copyright, unfair competition, trade secret and other laws to protect our intellectual property and other proprietary rights may not be adequate.

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Because of the differences in foreign trademark, patent and other intellectual property or proprietary rights laws, we may not receive the same protection in foreign countries as we would in the United States.

Any failure of various measures to protect our technology and intellectual property, the independent discovery by third parties of our trade secrets and proprietary know-how and the independent development of substantially equivalent proprietary information or techniques by third parties could impair our competitive advantage.

In particular, the infringement, expiration or other loss of these methods and other proprietary information could reduce the barriers to entry into our existing lines of business and may result in a loss of market share, which could have a material adverse effect on our business, financial position, results of operations and cash flows.

Litigation may be necessary to enforce our intellectual property rights or to defend against claims by third parties that our products infringe their intellectual property rights.

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A successful intellectual property infringement suit against us could prevent us from manufacturing or selling certain products in a particular area, which could materially and adversely affect our business, financial position, results of operations or cash flows.

We face risks relating to doing business internationally that could materially and adversely affect our business, financial position, results of operations or cash flows.

We face risks associated with our international operations which could materially and adversely affect our business, financial position, results of operations or cash flows.

Our business operates and serves customers in certain foreign countries, including Australia, Belgium, Canada, China, New Zealand, Russia and the United Kingdom.

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Evolving foreign laws and legal systems, including those that will occur as a result of the United Kingdom’s withdrawal from the European Union (“Brexit”), may adversely affect global economic and market conditions and could contribute to volatility in the foreign exchange markets.

Brexit, without trade agreements with Great Britain’s largest trade partners, may adversely affect our UK businesses’ revenues and could subject us to new regulatory costs and challenges, in addition to other adverse effects that we are unable to effectively anticipate.

The United Kingdom left the E.U.

on January 31, 2020.

On May 1, 2021, the E.U.-U.K.

Trade and Cooperation Agreement (the “TCA”) became effective.

The TCA provides the United Kingdom and E.U.

members with preferential access to each other’s markets, without tariffs or quotas on imported products between the jurisdictions, provided that certain rules of origin requirements are complied with.

However, economic relations between the United Kingdom and the E.U.

will now be on more restricted terms than existed prior to Brexit.

It is difficult to predict the severity of the impact of these changes on our United Kingdom and E.U.

based operations.

Goods moving between the United Kingdom and any member of the E.U.

will be subject to additional customs requirements and documentation checks, leading to possible higher transportation and regulatory costs, as well as delays at ports of entry and departure.

Such delays could adversely impact elements of our supply chain and also our ability to meet customers’ delivery schedules.

The United Kingdom has yet to determine which E.U.

laws and regulations to replace or replicate and compliance with any amended or additional laws and regulations could increase our costs.

To the extent that higher costs are incurred which cannot be passed on to our customers, this could decrease the profitability of our United Kingdom and E.U.

Our inability to introduce new products effectively or implement our innovation strategies could adversely affect our ability to compete.

We continually seek to develop products and solutions that allow us to stay at the forefront of the needs of the Electrical Raceway and MP&S markets.

We continually seek to develop products and solutions that allow us to stay at the forefront of developments in the Electrical and Safety & Infrastructure markets.

The success of new products depends on a variety of factors, including but not limited to, timely and successful product development, the effective consummation of strategic acquisitions, market acceptance and demand, competitive response, protection of associated intellectual property and avoidance of third-party infringement of the Company’s intellectual property, our ability to manage risks associated with product life cycles, the effective management of inventory and purchase commitments, the availability and cost of raw materials and the quality of our initial products during the initial period of introduction.

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In introducing new products and implementing our innovation strategies, any delays, unexpected costs, diversion of resources, loss of key employees or other setbacks could materially and adversely affect our business, financial position, results of operations or cash flows.

Our business, financial position or results of operations could be materially and adversely affected by the ability to import raw materials, component parts and/or finished goods from existing suppliers and otherwise without government regulations or restrictions incremental to those borne by the business today.

Our business, financial position or results of operations could be materially and adversely affected by our inability to continue importing raw materials, component parts and/or finished goods under the regulatory regime applicable to our business.

Our business, financial position or results of operations could be materially and adversely affected by our inability to acquire or import raw materials, component parts or finished goods from existing suppliers and significant increases in government regulation or restrictions relating to such imports.

Our business, financial position or results of operations could be materially and adversely affected by our inability to import raw materials, component parts or finished goods under the regulatory regimes applicable to our business.

Although we seek to have alternate sources and recover increases in input costs through price increases in our products, regulatory changes or other governmental actions could result in the need to change suppliers or incur cost increases that cannot, in the short term, or in some cases even the long term, be offset by our prices.

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Any of these consequences could materially and adversely affect our business, financial position, results of operations or cash flows.

We rely on materials, components and finished goods, such as Cpic fiber, steel and aluminum, that are sourced from or manufactured in foreign countries.

Import tariffs and potential import tariffs have resulted or may result in increased prices for these imported goods and materials and, in some cases, may result or have resulted in price increases for domestically sourced goods and materials.

Changes in U.S.

trade policy have resulted and could result in additional reactions from U.S.

trading partners, including adopting responsive trade policies making it more difficult or costly for us to export our products or import goods and materials from those countries.

These measures could also result in increased costs for goods imported into the U.S.

or may cause us to adjust our worldwide supply chain.

Either of these could require us to increase prices to our customers which may reduce demand, or, if we are unable to increase prices, result in lowering our margin on products sold.

Additionally, anti-terrorism measures and other disruptions to the raw material supply network could impact our operations and those of our suppliers.

In the aftermath of terrorist attacks in the United States, federal, state and local authorities have implemented and continue to implement various security measures that affect the raw material supply network in the United States and abroad.

If security measures disrupt or impede the receipt of sufficient raw materials to us and our suppliers, we may fail to meet the needs of our customers or may incur increased expenses to do so.

In connection with acquisitions, joint ventures or divestitures, we may become subject to liabilities and required to issue additional debt or equity.

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We cannot assure you that we will identify or successfully complete transactions with suitable acquisition candidates in the future, nor can we assure you that completed acquisitions will be successful.

If an acquired business fails to operate as anticipated or cannot be successfully integrated with our existing business, our business, financial condition, results of operations or cash flows could be materially and adversely affected.

Regulations related to "conflict minerals" may force us to incur additional expenses, may make our supply

chain more complex and may result in damage to our reputation with customers.

If an acquired business fails to operate as anticipated or presents greater than expected liability profile or cannot be successfully integrated with our existing business, our business, financial position, results of operations or cash flows could be materially and adversely affected.

Regulations related to “conflict minerals” may force us to incur additional expenses, create complexities in our supply chain and damage our reputation with customers.

As a public company, we are subject to the requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the “Dodd-Frank Act.” The SEC has adopted requirements under the Dodd-Frank Act for companies that use certain minerals and metals, known as conflict minerals, in their products, whether or not these products are manufactured by third parties.

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There are costs associated with complying with these disclosure requirements, including for efforts to determine the sources of conflict minerals used in our products and other potential changes to products, processes or sources of supply as a consequence of such verification activities.

In addition, compliance with these requirements could adversely affect the sourcing, supply and pricing of materials used in those products and we may face reputational challenges if we are unable to verify the origins for all "conflict minerals" used in products through the procedures we have implemented.

In addition, compliance with these requirements could adversely affect the sourcing, supply and pricing of materials used in our products.

Specifically, such requirements could limit the pool of suppliers who can provide conflict-free minerals and as a result, we may not be able to obtain these conflict-free minerals at competitive prices.

We may also face reputational challenges if we are unable to verify the origins for all “conflict minerals” used in our products through the procedures we have implemented.

We may also encounter challenges to satisfy customers that may require all of the components of products purchased to be certified as conflict free.

If we are not able to meet customer requirements, customers may choose to disqualify us as a supplier.

Anti-terrorism measures and other disruptions to the raw material supply network could impact our operations and those of our suppliers.

Our ability to provide efficient distribution of products to our customers is an integral component of our overall business strategy.

If security measures disrupt or impede the receipt of sufficient raw materials to us and our suppliers, we may fail to meet the needs of our customers or may incur increased expenses to do so.

If we are not able to meet customer requirements, customers may choose to disqualify us as a supplier, or we may be forced to reduce our prices to compensate for this lack of certification.

Risks Related to Our Indebtedness

Our indebtedness may adversely affect our financial health.

As of September 30, 2020 , we had approximately $811.5 million of total long-term consolidated indebtedness outstanding (including current portion) under AII's credit facilities (" Credit Facilities "), which consist of:

As of September 30, 2021, we had approximately $771.1 million of total long-term consolidated indebtedness outstanding (including current portion) under AI and AII’s credit facilities (“Credit Facilities”), which consist of:

(i) an asset-based credit facility (“ABL Credit Facility”);

and (ii) the first lien term loan facility (the "First Lien Term Loan Facility").

(ii) the new senior secured term loan facility (the “New Senior Secured Term Loan Facility”);

and (iii) the 4.25% Senior Notes due 2031 (the “Senior Notes”).

As of September 30, 2021, AII had $315.5 million of available borrowing capacity under the ABL Credit Facility and there were no outstanding borrowings (excluding $9.5 million of letters of credit issued under the facility).

Our indebtedness could have important consequences to you.

Our indebtedness could have important consequences for you.

Because of our indebtedness:

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We and our subsidiaries may incur substantial additional indebtedness in the future.

The terms of the credit agreements governing the Credit Facilities do not fully prohibit us or our subsidiaries from incurring additional debt.

The terms of the credit agreements and indenture governing the Credit Facilities do not fully prohibit us or our subsidiaries from incurring additional debt.

If our subsidiaries are in compliance with certain leverage or coverage ratios set forth in the agreements governing the Credit Facilities, they may be able to incur substantial additional indebtedness, which may increase the risks created by our current indebtedness.

Subject to certain conditions and without the consent of the then existing lenders, the loans under the First Lien Term Loan Facility may be expanded (or a new term loan facility, revolving credit facility or letter of credit facility added) by up to $235.0 million , plus an additional amount not to exceed specified leverage or coverage ratios.

Subject to certain conditions and without the consent of the then existing lenders, the loans under the New Senior Secured Term Loan Facility may be expanded (or a new term loan facility, revolving credit facility or letter of credit facility added) by up to $235.0 million, plus an additional amount not to exceed specified leverage or coverage ratios.

In addition, subject to certain conditions and without the consent of the then existing lenders, the loans under the ABL Credit Facility may be expanded by up to $150 million, and the credit agreements governing the Credit Facilities allow for up to $50.0 million of second lien facilities.

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Increases in interest rates would increase the cost of servicing our indebtedness and could reduce our profitability.

A significant portion of our outstanding indebtedness bears interest or will bear interest at variable rates.

A portion of our outstanding indebtedness bears interest or will bear interest at variable rates.

As a result, increases in interest rates would increase the cost of servicing our indebtedness and could materially and adversely affect our business, financial position, results of operations or cash flows.

As of September 30, 2020 , each one percentage point change in interest rates would have resulted in a change of approximately $8.2 millio n in the annual interest expense on the First Lien Term Loan Facility.

As of September 30, 2021, each one percentage point change in interest rates would have resulted in a change of approximately $3.8 million in the annual interest expense on the New Senior Secured Term Loan Facility.

As of September 30, 2021, assuming availability was fully utilized, each one percentage point change in interest rates would have resulted in a change of approximately $3.3 million in annual interest expense on the ABL Credit Facility.

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The impact of increases in interest rates could be more significant for us than it would be for some other companies because of our indebtedness, thereby affecting our profitability.

Further, the United Kingdom’s Financial Conduct Authority, which regulates LIBOR, has announced that it intends to stop encouraging or compelling banks to submit rates for the calculation of LIBOR rates after 2021 (“FCA Announcement”).

The FCA Announcement indicates that the continuation of LIBOR on the current basis is not guaranteed after 2021 and, based on the foregoing, it appears likely that LIBOR will be discontinued or modified by 2021.

It is not possible to predict the effect the FCA Announcement, any discontinuation, modification or other reforms to LIBOR or the establishment of alternative reference rates may have on LIBOR.

Furthermore, the use of alternative reference rates or other reforms could adversely affect the interest rates payable under our current and/or future indebtedness bearing interest at variable rates.

In addition, a transition away from LIBOR as a benchmark for establishing the applicable interest rate may affect the cost of servicing our debt under the New Senior Secured Term Loan Facility and the ABL Credit Facility.

The potential consequences from discontinuation, modification, or reform of LIBOR, implementation of alternative reference rates, and any interest rate transition process cannot be fully predicted and may have an adverse impact on values of LIBOR-linked securities and other financial obligations or extensions of credit and may involve among other things, increased volatility or illiquidity in markets for instruments that rely on LIBOR, reductions in effectiveness of related transactions such as hedges, increased borrowing costs or uncertainty under applicable documentation.

For example, if any alternative base rate or means of calculating interest with respect to our outstanding variable rate indebtedness leads to an increase in the interest rates charged, it could result in an increase in the cost of such indebtedness, impact our ability to refinance some or all of our existing indebtedness or otherwise have a material adverse impact on our business, financial position, results of operations or cash flows.

A lowering or withdrawal of the ratings, outlook or watch assigned to our indebtedness by rating agencies may increase our future borrowing costs and reduce our access to capital.

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Our ability to generate the significant amount of cash needed to pay interest and principal on our indebtedness and our ability to refinance all or a portion of our indebtedness or obtain additional financing depends on many factors beyond our control.

Atkore International Group Inc.

("AIG"), AIH, and AII are each holding companies, and as such they have no independent operations or material assets other than ownership of equity interests in their respective subsidiaries.

AIG, AIH and AII each depend on their respective subsidiaries to distribute funds to them so that they may pay obligations and expenses, including satisfying obligations with respect to indebtedness.

(“AI”), AIH, and AII are each holding companies, and as such they have no independent operations or material assets other than ownership of equity interests in their respective subsidiaries.

AI, AIH and AII each depend on their respective subsidiaries to distribute funds to them so that they may pay obligations and expenses, including satisfying obligations with respect to indebtedness.

Our ability to make scheduled payments on, or to refinance our obligations under, our indebtedness depends on the financial and operating performance of our subsidiaries and their ability to make distributions and dividends to us, which, in turn, depends on their results of operations, cash flows, cash requirements, financial position and general business conditions and any legal and regulatory restrictions on the payment of dividends to which they may be subject, many of which may be beyond our control.

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If our cash flow and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets, seek to obtain additional equity capital or restructure our indebtedness.

In the future, our cash flow and capital resources may not be sufficient for payments of interest on

and principal of our indebtedness, and such alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations.

The outstanding borrowings under the First Lien Term Loan Facility have a maturity date of December 22, 2023 and the ABL Credit Facility is scheduled to mature on August 28, 2023.

In the future, our cash flow and capital resources may not be sufficient for payments of interest on and principal of our indebtedness, and such alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations.

The outstanding borrowings under the ABL Credit Facility are scheduled to mature on May 26, 2026, the New Senior Secured Term Loan Facility has a maturity date of May 26, 2028, and the Senior Notes mature on June 1, 2031.

We may be unable to refinance any of our indebtedness or obtain additional financing, particularly because of our indebtedness.

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Risks Related to Our Common Stock

AIG is a holding company with no operations of its own, and it depends on its subsidiaries for cash to fund all of its operations and expenses, including to make future dividend payments, if any.

AI is a holding company with no operations of its own, and it depends on its subsidiaries for cash to fund all of its operations and expenses, including to make future dividend payments, if any.

Our operations are conducted entirely through our subsidiaries, and our ability to generate cash to fund our operations and expenses, to pay dividends or to meet debt service obligations is highly dependent on the earnings and the receipt of funds from our subsidiaries through dividends or intercompany loans.

Deterioration in the financial condition, earnings or cash flow of AII and its subsidiaries for any reason could limit or impair their ability to pay such distributions.

Additionally, to the extent our subsidiaries are restricted from making such distributions under applicable law or regulation or under the terms of our financing arrangements, or are otherwise unable to provide funds to the extent of our needs, there could be a material adverse effect on our business, financial condition, results of operations or cash flows.

For example, the agreements governing the Credit Facilities significantly restrict the ability of our subsidiaries to pay dividends, make loans or otherwise transfer assets to us.

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The timing and amount of the Company’s share repurchases are subject to a number of uncertainties.

In February 2019, the Company announced that its board of directors had approved a share repurchase program for the repurchase of up to an aggregate amount of $50 million of the Company’s common stock over a two year period.

On November 16, 2021, the board of directors approved a share repurchase program for the repurchase of up to an aggregate amount of $400 million of the Company’s common stock over a two-year period.

We expect that share repurchases under the program will be funded with cash on hand.

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• authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to thwart a takeover attempt;

provide for a classified board of directors until the 2022 annual meeting, which divides our board of directors into three classes, with members of each class serving staggered three-year terms, except that those directors elected at the 2020 and 2021 annual meetings will be elected for one-year terms, which prevents stockholders from electing an entirely new board of directors at an annual meeting until the 2022 annual meeting;

• limit the ability of stockholders to remove directors;

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We do not currently intend to declare and pay dividends on our common stock for the foreseeable future.

We currently intend to use our future earnings, if any, to repay debt, to fund our growth, to develop our business, for working capital needs and for general corporate purposes.

We currently intend to use our future earnings, if any, to fund our growth, to develop our business, for working capital needs, for general corporate purposes, to repurchase shares and to repay debt.

Therefore, you are not likely to receive any dividends on your common stock for the foreseeable future, and the success of an investment in shares of our common stock depends upon any future appreciation in their value.

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Our amended and restated certificate of incorporation includes provisions limiting the personal liability of our directors for breaches of fiduciary duty under the DGCL.

Our amended and restated certificate of incorporation contains provisions permitted under the action asserting a claim arising under the General Corporation Law of the State of Delaware ("DGCL") relating to the liability of directors.

Our amended and restated certificate of incorporation contains provisions relating to the liability of directors in response to claims arising under the General Corporation Law of the State of Delaware (“DGCL”).

These provisions eliminate a director’s personal liability to the fullest extent permitted by the DGCL for monetary damages resulting from a breach of fiduciary duty, except in circumstances involving:

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• industry or general market conditions;

• availability of labor and raw materials;

• domestic and international economic factors unrelated to our performance;

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Future tax legislation could materially impact our business.

The impact of the legislation could change as we analyze and apply additional regulations or guidance.

In addition, other changes in international and domestic tax laws, including the reaction by states to federal legislation or the costs of responding to the pandemic, and changes in tax law enforcement, could negatively impact our tax provision, cash flow, and/or tax related balance sheet amounts.

Changes in international and domestic tax laws, including the reaction by states to federal legislation or the costs of responding to the COVID-19 pandemic, and changes in tax law enforcement, could negatively impact our tax provision, cash flow, or tax related balance sheet amounts.

In particular, it is possible that U.S.

federal income or other tax laws or the interpretation of tax laws will change, including as a result of possible tax legislation that may be proposed by the Biden Administration.

It is difficult to predict whether and when there will be tax law changes having a material adverse effect on our business, financial position, results of operations and cash flows.

Changes in U.S.

tax law could also have broader implications, including impacts to the economy, currency markets, inflation environment, consumer behavior, and/or competitive dynamics, which are difficult to predict, and may positively or negatively impact our business, financial position, results of operations or cash flows.

tax law could also have broader implications, including impacts to the economy, currency markets, inflation environment, consumer behavior or competitive dynamics, which are difficult to predict, and may positively or negatively impact our business, financial position, results of operations or cash flows.

Future offerings of debt or equity securities which would rank senior to our common stock may adversely affect the market price of our common stock.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors