World Fuel Services 2015 Annual Report Download - page 14

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• our ability to effectively integrate the operations, financial reporting, and personnel of acquired companies and
manage acquired businesses or strategic investments, while maintaining uniform standards and controls;
• our ability to realize our investment and anticipated synergies in the acquired businesses or strategic investments;
• the diversion of management’s time and attention from other business concerns, the potentially negative impact of
changes in management on existing business relationships and other disruptions of our business;
• the risks associated with entering into businesses or markets in which we may have no or limited direct prior
experience;
• the potential loss of key employees, customers or suppliers of the acquired businesses;
• the ability to integrate the IT systems of acquired businesses into our existing IT infrastructure and manage those
systems that cannot be effectively integrated;
• the requirement to write down acquired assets as a result of the acquired business or strategic investment being
worth less than we paid or invested in it;
• capital expenditure requirements exceeding our estimates;
• the risk that an acquisition or strategic investment could reduce our future earnings; and
• the assumption of material liabilities, exposure to litigation, regulatory noncompliance or unknown liabilities, and no
or limited indemnities from sellers or ongoing indemnity obligations to purchasers.
Adverse conditions in the aviation, marine and land transportation industries may have a material adverse effect
on our business.
Our business is focused on the marketing of fuel and other related products and services to the aviation, marine and land
transportation industries, which are generally affected by economic cycles. Therefore, weak economic conditions can have
a negative impact on the business of our customers which may, in turn, have an adverse effect on our business. In addition,
any political instability, natural disasters and other weather-related events, terrorist activity or military action that disrupts
shipping, flight operations or land transportation will adversely affect our customers and may reduce the demand for our
products and services. Our business could also be adversely affected by increased merger activity in the aviation, marine
or land transportation industries, which may reduce the number of customers that purchase our products and services, as
well as the prices we are able to charge for such products and services.
In addition, the aviation, marine and land transportation industries are subject to continuing changes in laws and regulations,
including environmental regulations mandating or incentivizing alternative energy sources or attempting to control or limit
emissions and pollution. For example, amendments to the International Convention for the Prevention of Pollution from
Ships, or MARPOL, established a phased reduction of the sulfur content in fuel oil and allows for stricter sulfur limits in
designated emission control areas. Further changes in laws and regulations applicable to international and national maritime
trade are expected over the coming years. Complying with these and other laws and regulations may require capital
expenditures by our customers or otherwise increase our customers’ operating costs, which could in turn, reduce the
demand for our products and services. Although the ultimate impact of any regulations is difficult to predict accurately, they
could have a material adverse effect on our business or on the businesses of our customers.
Our business is subject to seasonal variability, which can cause our revenues and operating results to fluctuate
and adversely affect the market price of our shares.
Our operating results are subject to seasonal variability. Our seasonality results from numerous factors, including
traditionally higher demand for natural gas and home heating oil during the winter months and aviation and land fuel during
the summer months, as well as other seasonal weather patterns. As such, our results for the fourth and first quarters of the
year tend to be the strongest while the second quarter is generally the weakest. There can be no assurance that our historic
operating results patterns will continue in future periods as we cannot influence or forecast all of these factors. Accordingly,
results for any one quarter may not necessarily be indicative of the results that may be achieved for any other quarter or for
the full fiscal year. These seasonal fluctuations in our quarterly operating results may therefore adversely affect the market
price of our shares.
If we fail to comply with laws or other government regulations applicable to our operations, we could suffer
penalties or costs that could have a material adverse effect on our business.
We are required to comply with extensive and complex laws and other regulations in the countries in which we operate, and
at the international, federal, state and local government levels relating to, among other things:
• the transportation, handling and delivery of fuel and fuel products;