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HBI » Topics » Our supply chain is reliant on an extensive network of foreign operations and any disruption to or adverse impact on our foreign operations may adversely affect our business, results of operations and financial condition.

This excerpt taken from the HBI 8-K filed Sep 5, 2006.

Our supply chain is reliant on an extensive network of foreign operations and any disruption to or adverse impact on our foreign operations may adversely affect our business, results of operations and financial condition.

We have an extensive global supply chain in which a significant portion of our products are manufactured in or sourced from locations in Central America, the Caribbean Basin, Mexico and Asia. Potential events that may disrupt our foreign operations include:

 

  •   political instability and acts of war or terrorism;

 

  •   disruptions in shipping and freight forwarding services;

 

  •   increases in oil prices, which would increase the cost of shipping;

 

  •   interruptions in the availability of basic services and infrastructure, including power shortages;

 

  •   fluctuations in foreign currency exchange rates resulting in uncertainty as to future asset and liability values, cost of goods and results of operations that are denominated in foreign currencies;

 

  •   extraordinary weather conditions or natural disasters, such as hurricanes, earthquakes or tsunamis; and

 

  •   the occurrence of an epidemic, the spread of which may impact our ability to obtain products on a timely basis.

Disruptions to our foreign operations have an adverse impact on our supply chain which can result in production and sourcing interruptions, increases in our cost of sales and delayed deliveries of our products to our customers, all of which can have an adverse affect on our business, results of operations and financial condition.

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