Nautilus 2013 Annual Report Download - page 10

SEC-
0330 for further information on the Public Reference Room. The SEC maintains an Internet website at http://www.sec.gov where you can
access copies of most of our SEC filings.
We make our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-
K, and amendments to those reports,
available free of charge on our corporate website. In addition, our Code of Business Conduct and Ethics, corporate governance policies, and the
charters of our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee are available on our
corporate website. The information presented on our corporate website is not part of this report.
Item 1A. Risk Factors
Nautilus operates in an environment that involves a number of risks and uncertainties. The risks and uncertainties described in this Annual
Report on Form 10-
K are not the only risks and uncertainties that we face. Additional risks and uncertainties that presently are not considered
material or are not known to us, and therefore are not mentioned herein, may impair our business operations. If any of the risks described in this
Annual Report on Form 10-K actually occur, our business, operating results and financial position could be adversely affected.
Our revenues and profitability can fluctuate from period to period and are often difficult to predict due to factors beyond our control.
Our results of operations in any particular period may not be indicative of results to be expected in future periods, and have historically been, and
are expected to continue to be, subject to periodic fluctuations arising from a number of factors, including:
These trends and factors could adversely affect our business, operating results, financial position and cash flows in any particular period.
Intense competition or loss of one or more of our large Retail customers could negatively impact our sales and operating results.
Our products are sold in highly competitive markets with limited barriers to entry. As a result, introduction by competitors of lower-
priced or
more innovative products could result in a significant decline in our revenues and have a material adverse effect on our operating results,
financial position and cash flows.
Additionally, we derive a significant portion of our revenue from a small number of Retail customers. A loss of business from one or more of
these large customers, if not replaced with new business, could negatively affect our operating results and cash flow.
A decline in sales of TreadClimber products without a corresponding increase in sales of other products would negatively affect our
future revenues and operating results.
Sales of cardio products, especially Bowflex
®
TreadClimber
®
products, represent a substantial portion of our Direct segment revenues.
Introduction by competitors of comparable products at lower price-points, a maturing product lifecycle or other factors
6
•
Introduction and market acceptance of new products and sales trends affecting specific existing products;
•
Variations in product selling prices and costs and the mix of products sold;
•
Size and timing of Retail customer orders, which, in turn, often depend upon the success of our customers' businesses or
specific products;
•
Changes in the market conditions for consumer fitness equipment;
•
Changes in macroeconomic factors;
•
Availability of consumer credit;
•
Timing and availability of products coming from our offshore contract manufacturing suppliers;
• Seasonality of markets, which vary from quarter-to-
quarter and are influenced by outside factors such as overall consumer
confidence and the availability and cost of television advertising time;
•
Effectiveness of our media and advertising programs;
•
Customer consolidation in our Retail segment, or the bankruptcy of any of our larger Retail customers;
•
Restructuring charges;
•
Goodwill and other intangible asset impairment charges; and
•
Legal and contract settlement charges.