CSU’s investor relations website includes forward-looking statements that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of its management, and on information currently available to the Company. Forward-looking statements include statements regarding CSU’s intent, belief or current expectations or that of its directors or executive officers with respect to, but not limited to:
- General economic, political, demographic and business conditions in Brazil;
- The expectations and projections of CSU managers as to its future financial performance, financial plans and competition;
- The Company’s ability to execute its business strategy, including its ability to obtain financing on favorable terms and conditions, if and when necessary;
- Changes in the strategies and plans of CSU controlling shareholders;
- Inflation or the appreciation or depreciation of the real;
- Competition in the card processing industry and related activities;
- Changes in tax laws and regulations;
- Technological developments and increase in costs;
- Cyclical changes that may affect the Company’s results of operations;
- Interruptions in the services CSU provides and energy rationing;
- Changes in consumer demand for the Company’s services;
- Early termination of CSU commercial contracts;
- Other factors or trends affecting the Company’s financial condition or results of operations and the ones discussed under the section Risk Factors; and
- Other statements contained in this website regarding matters that are not historical facts.
Investors should understand that the above-mentioned factors, in addition to others discussed in this investor relations website, among others, could affect CSU’s future results and could cause results to differ materially from those expressed in the forward-looking statements made in this website or files herein posted.
Forward-looking statements also include information concerning the Company’s possible or assumed future results of operations set forth under several sections in this investor relations website, as well as statements preceded by, followed by, or that include the words ‘‘believes,’’ ‘‘may,’’ ‘‘continues,’’ ‘‘expects,’’ ‘‘anticipates,’’ ‘‘intends,’’ ‘‘plans,’’ ‘‘estimates’’ or similar expressions.
Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur. CSU’s future business, financial condition, results of operations, prospects, strategies, market share and shareholder values may differ materially from those expressed in or suggested by these forward-looking statements. Many of the factors that will determine these results and values are beyond the Company’s ability to control or predict.
Investors are cautioned not to put undue reliance on any forward-looking statements.
An investment in securities involves a high degree of risk. All investors should carefully consider the following factors in addition to the other information in this investor relations website before investing in CSU’s securities. In general, investing in the securities of issuers in emerging market countries, such as Brazil, involves a higher degree of risk than investing in the securities of U.S. issuers or issuers in other countries with highly developed capital markets. CSU’s business, financial condition, results of operations and prospects may be materially adversely affected by any of these risks.
The risks briefly described below are those that the Company currently believes most likely may materially affect its performance.
1. Risks Relating to Brazil
- The Brazilian government and other governmental agencies exercise significant influence over the Brazilian economy; and Brazilian political and economic conditions could adversely affect the Company and the price of CSU’s common shares and the ADSs.
- Inflation and efforts by the Brazilian government to curb inflation may contribute significantly to economic uncertainty in Brazil and could harm the Company and the market price of CSU’s common shares and the ADSs.
- Volatility in the value of the Brazilian real in relation to the U.S. dollar and other currencies may negatively affect the Company.
- The perception of risk in other economies, primarily emerging market economies, may adversely affect the Brazilian economy and CSU and the market price of its common shares and the ADSs.
2. Risks Relating to CSU’s Business
- Because the markets in which the Company provides its services are highly competitive, CSU may have difficulty growing its business.
- The Company faces intense competitive pressure on the prices CSU charges its customers, which may materially and adversely affect its revenue and profitability.
- CSU service agreements are concentrated in a few major costumers, which could have a material adverse impact on its business.
- If third party services providers terminate their agreements with the Company or fail to renew or perform their material agreements, CSU may incur significant costs in developing or replacing their technology and infrastructure.
- The Company’s costumers may elect to bring in-house their card processing, management and operation of call centers, credit analyses and collection activities or any other services they currently outsource to CSU, which may adversely affect its business.
- The Company may not be able to charge its clients increased costs, including the price CSU pays its suppliers.
- If the Company is not able to keep pace with the rapid technological developments in its industry or license the necessary technology from third parties on terms satisfactory to CSU, the use of its services could decline, which would reduce its revenue.
- The loss of CSU’s senior management or key employees could disrupt its business.
- Unauthorized disclosure of customer and cardholder data, whether through breach of computer systems or otherwise, could expose the Company to liability and costly litigation.
3. Risks Related to CSU’s Common Shares and the ADSs
- CSU’s controlling shareholders may take certain decisions with respect to the Company’s business without the participation of all of its shareholders, which may be conflicting to investors’ interests.
- Sales of significant amounts of CSU common shares may cause the market price of its common shares and/or ADSs to decrease.
- The Company may need additional capital in the future, which may not be available to CSU. The raising of additional capital may dilute investors’ ownership in the Company.
- As a purchaser of CSU common shares or ADSs investors will suffer immediate dilution in the book value of their investment.
- Changes in Brazilian tax laws may have an adverse impact on the taxes applicable to a sale of CSU common shares or ADSs.
- Any capital gain arising from a sale of the Company’s common shares registered as a direct foreign investment in Brazil could be calculated based on the historical amount in Brazilian currency of the investment, rather than the amount in foreign currency registered with the Central Bank.
- Exchanging ADSs for the underlying common shares may have unfavorable consequences.
- Asserting investor’s distribution and voting rights as a holder of ADSs may prove more difficult than for holders of common shares.
- Holders of ADSs may be unable to exercise preemptive rights with respect to CSU common shares.
- Holders of the Company’s common shares or ADSs may face difficulties in serving process on or enforcing judgments against CSU and other persons.
- It is expected that non-corporate U.S. shareholders will be ineligible for the favorable U.S. federal income tax treatment that applies to dividend income received from certain corporations.