What changed in this filing

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Item 1A. Risk Factors

2023-01-27 compared with 2022-07-29 · 2 added, 48 removed, 2 unchanged (96% of the section changed)

There have been no material changes in our risk factors from those disclosed in “Part I.

Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 24, 2021 except as described below.

The risk factors described in our Annual Report on Form 10-K, in addition to other information set forth below and in this report, could materially affect our business operations, financial condition, or liquidity.

Additional risks and uncertainties not currently known to us or that we currently believe are immaterial may also impair our business operations, financial condition, and liquidity.

We have suffered and could continue to suffer significant business interruptions, including impacts resulting from the COVID-19 pandemic and other macroeconomic factors.

Our operations and those of our suppliers and customers, and the supply chains that support their operations, may be vulnerable to interruption by natural disasters such as earthquakes, tsunamis, typhoons, tornados, or floods;

other disasters such as fires, explosions, acts of terrorism, or war, including continuing military conflict between Russia and Ukraine resulting from Russia’s invasion of Ukraine or escalating tensions in surrounding countries;

disease or other adverse health developments, including impacts resulting from the COVID-19 pandemic;

or failures of management information or other systems due to internal or external causes.

In addition, such interruptions could result in a widespread crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could affect demand for our end customers’ products.

If a business interruption occurs and we are unsuccessful in our continuing efforts to minimize the impact of these events, our business, results of operations, financial position, and cash flows could be materially adversely affected.

The COVID-19 pandemic impacted and continues to impact countries, communities, workforces, supply chains, and markets around the world, and as a result, we have experienced disruptions and restrictions on our employees’ ability to travel, as well as temporary closures of our facilities and the facilities of our customers, suppliers, and other vendors in our supply chain.

As a result of the ongoing impacts of the COVID-19 pandemic, some of our employees are continuing to work from home on a full-time or part-time basis, which may increase our vulnerability to cyber and other information technology risks.

The COVID-19 pandemic had a negative impact on certain of our businesses in fiscal 2021 and continued to impact certain of our operations in China in the first nine months of fiscal 2022.

While certain of our operations in China were shut down for a period of time in fiscal 2022, we do not expect the COVID-19 pandemic to have a significant impact on our businesses globally in fiscal 2022.

However, it may have a negative impact on our financial condition, liquidity, and results of operations in future periods.

The extent to which the COVID-19 pandemic will further impact our business and our financial results will depend on future developments, which are highly uncertain and cannot be predicted.

Such developments may include the further spread of the virus to additional persons and geographic regions;

the severity of the virus;

variant strains of the virus;

the duration of the pandemic;

resumption of high levels of infections and hospitalizations;

the success of public health advancements, including vaccine production and distribution;

the resulting impact on our suppliers’ and customers’ supply chains and financial positions, including their ability to pay us;

the actions that may be taken by various governmental authorities in response to the outbreak in jurisdictions in which we operate;

and the possible impact on the global economy and local economies in which we operate.

Further, to the extent the COVID-19 pandemic adversely affects our business, results of operations, or financial condition, it may also have the effect of heightening many of the other risks described in this “Risk Factors” section and in “Part I.

Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2022.

We are subject to global risks of political, economic, and military instability.

Our workforce;

manufacturing, research, administrative, and sales facilities;

and suppliers are located throughout the world.

As a result, we are exposed to risks that could negatively affect sales or profitability, including:

● changes in global trade policies, including sanctions, tariffs, trade barriers, and trade disputes;

● regulations related to customs and import/export matters;

● variations in lengths of payment cycles and challenges in collecting accounts receivable;

● tax law and regulatory changes in Switzerland, the U.S., and the European Union (“EU”) among other jurisdictions, including tax law and regulatory changes that may be effected as a result of tax policy recommendations from quasi-governmental organizations such as the Organisation for Economic Co-operation and Development (“OECD”), examinations by taxing authorities, variations in tax laws from country to country, changes to the terms of income tax treaties, and difficulties in the tax-efficient repatriation of cash generated or held in a number of jurisdictions;

● employment regulations and local labor conditions, including increases in employment costs, particularly in low-cost regions in which we currently operate;

● difficulties protecting intellectual property;

● instability in economic or political conditions, including sovereign debt levels, Eurozone uncertainty, inflation, recession, and actual or anticipated military or political conflicts, including continuing military conflict between Russia and Ukraine resulting from Russia’s invasion of Ukraine or escalating tensions in surrounding countries;

● the impact of the United Kingdom’s withdrawal from the EU (commonly referred to as “Brexit”) could cause disruptions to, and create uncertainty surrounding, our business, including affecting our relationships with existing and potential customers and suppliers;

● the impact of each of the foregoing on our outsourcing and procurement arrangements.

We have sizeable operations in China.

As of fiscal year end 2021, we had 16 principal manufacturing sites in China.

In addition, approximately 22% of our net sales were made to customers in China in both fiscal 2021 and the first nine months of fiscal 2022.

Economic conditions in China have been, and may continue to be, volatile and uncertain.

In addition, the legal and regulatory system in China continues to evolve and is subject to change.

Accordingly, our operations and transactions with customers in China could be adversely affected by changes to market conditions, changes to the regulatory environment, or interpretation of Chinese law.

In addition, any downgrade by rating agencies of long-term U.S.

sovereign debt or downgrades or defaults of sovereign debt of other nations may negatively affect global financial markets and economic conditions, which could negatively affect our business, financial condition, and liquidity.

The risk factors described in our Annual Report on Form 10-K, in addition to other information in this report, could materially affect our business operations, financial condition, or liquidity.

Additional risks and uncertainties not currently known to us or that we currently believe are immaterial may also impair our business operations, financial condition, and liquidity.

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-Q

Item 1A. Risk Factors