Volatility of incoming orders
Some customers and industries served by the Andritz Group are directly dependent on general economic development and frequent fluctuations in demand for their products. This is especially true of the Pulp and Paper and the Rolling Mills and Strip Processing Lines Business Areas, but all Business Areas can be affected. The prices for these products are, in part, dependent on the prevailing relationship between supply and demand. Possible price fluctuations are, therefore, apt to have a direct influence on each customer’s capital investment decisions, with subsequent influence on the Group’s Order Intake. This may lead to volatility in the development of Order Intake of the Group.

Customer concentration
In some of the industries served by Andritz, there is a trend towards company mergers. This is especially prevalent in the pulp and paper and the steel industries. These mergers might result in a reduction of the number of customers in the future, as well as the Group having to negotiate with global companies with greater purchasing power. The dependence on key customers might increase, which could have direct consequences on the Group’s financial development.

Uncertainty of future contracts
The Group’s future performance depends on, among other things, securing certain new contracts. It can sometimes be difficult to predict when an order for which the Andritz Group has provided a quotation will actually be awarded. Contract awards are often affected by events outside the control of the Group, such as prices, demand, and general economic conditions. This can cause difficulties in matching the Group’s workforce with contract needs. Although Andritz has been able to successfully manage this risk by outsourcing during brisk sales periods and producing in-house in periods of sales decline, this may change in the future.

Safety and environmental matters
The Group’s operations are subject to numerous local, national and supranational environmental regulations. The Group uses and generates hazardous substances in its manufacturing operations. In addition, many of the Group’s current and former properties are, or were, used for industrial purposes, and disposal of waste at disposal sites has been arranged. It is possible that in the future the Group may be subject to liabilities relating to the investigation and clean-up of contaminated areas.

In addition, the Group provides several systems that involve the use of dangerous and hazardous chemicals and materials and provides installation and other services on industrial sites containing dangerous and hazardous chemicals and materials. In the event of a spill of these hazardous materials, accident or explosion involving such chemicals or materials, the Group could be responsible for property damage, personal injury, environmental remedies and/or have to assume other liabilities arising out of such spill, accident, or explosions.