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dd4c276ce | item 12 .
security ownership of certain beneficial owners and management and related stockholder matters .
the information required by item 12 is included under the heading 201csecurity ownership of management and certain beneficial owners 201d in the 2017 proxy statement , and that information is incorporated by reference in this form 10-k .
equity compensation plan information the following table provides information about our equity compensation plans that authorize the issuance of shares of lockheed martin common stock to employees and directors .
the information is provided as of december 31 , 2016 .
plan category number of securities to be issued exercise of outstanding options , warrants and rights weighted-average exercise price of outstanding options , warrants and rights number of securities remaining available for future issuance under equity compensation ( excluding securities reflected in column ( a ) ) equity compensation plans approved by security holders ( 1 ) 5802673 $ 85.82 6216471 equity compensation plans not approved by security holders ( 2 ) 1082347 2014 2481032 .
plan category | number of securities to beissued upon exercise of outstanding options warrants and rights ( a ) | weighted-average exercise price of outstanding options warrants and rights ( b ) | number of securities remaining availablefor future issuance under equity compensation plans ( excluding securities reflected in column ( a ) ) ( c )
--------------------------------------------------------------- | ----------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------
equity compensation plans approved by securityholders ( 1 ) | 5802673 | $ 85.82 | 6216471
equity compensation plans not approved bysecurity holders ( 2 ) | 1082347 | 2014 | 2481032
total | 6885020 | $ 85.82 | 8697503
( 1 ) column ( a ) includes , as of december 31 , 2016 : 1747151 shares that have been granted as restricted stock units ( rsus ) , 936308 shares that could be earned pursuant to grants of performance stock units ( psus ) ( assuming the maximum number of psus are earned and payable at the end of the three-year performance period ) and 2967046 shares granted as options under the lockheed martin corporation 2011 incentive performance award plan ( 2011 ipa plan ) or predecessor plans prior to january 1 , 2013 and 23346 shares granted as options and 128822 stock units payable in stock or cash under the lockheed martin corporation 2009 directors equity plan ( directors equity plan ) or predecessor plans for members ( or former members ) of the board of directors .
column ( c ) includes , as of december 31 , 2016 , 5751655 shares available for future issuance under the 2011 ipa plan as options , stock appreciation rights ( sars ) , restricted stock awards ( rsas ) , rsus or psus and 464816 shares available for future issuance under the directors equity plan as stock options and stock units .
of the 5751655 shares available for grant under the 2011 ipa plan on december 31 , 2016 , 516653 and 236654 shares are issuable pursuant to grants made on january 26 , 2017 , of rsus and psus ( assuming the maximum number of psus are earned and payable at the end of the three-year performance period ) , respectively .
the weighted average price does not take into account shares issued pursuant to rsus or psus .
( 2 ) the shares represent annual incentive bonuses and long-term incentive performance ( ltip ) payments earned and voluntarily deferred by employees .
the deferred amounts are payable under the deferred management incentive compensation plan ( dmicp ) .
deferred amounts are credited as phantom stock units at the closing price of our stock on the date the deferral is effective .
amounts equal to our dividend are credited as stock units at the time we pay a dividend .
following termination of employment , a number of shares of stock equal to the number of stock units credited to the employee 2019s dmicp account are distributed to the employee .
there is no discount or value transfer on the stock distributed .
distributions may be made from newly issued shares or shares purchased on the open market .
historically , all distributions have come from shares held in a separate trust and , therefore , do not further dilute our common shares outstanding .
as a result , these shares also were not considered in calculating the total weighted average exercise price in the table .
because the dmicp shares are outstanding , they should be included in the denominator ( and not the numerator ) of a dilution calculation .
item 13 .
certain relationships and related transactions and director independence .
the information required by this item 13 is included under the captions 201ccorporate governance 2013 related person transaction policy , 201d 201ccorporate governance 2013 certain relationships and related person transactions of directors , executive officers , and 5 percent stockholders , 201d and 201ccorporate governance 2013 director independence 201d in the 2017 proxy statement , and that information is incorporated by reference in this form 10-k .
item 14 .
principal accountant fees and services .
the information required by this item 14 is included under the caption 201cproposal 2 2013 ratification of appointment of independent auditors 201d in the 2017 proxy statement , and that information is incorporated by reference in this form 10-k. |
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dd49901cc | 28 2014 annual report performance graph the following chart presents a comparison for the five-year period ended june 30 , 2014 , of the market performance of the company 2019s common stock with the s & p 500 index and an index of peer companies selected by the company : comparison of 5 year cumulative total return among jack henry & associates , inc. , the s&p 500 index , and a peer group the following information depicts a line graph with the following values: .
| 2009 | 2010 | 2011 | 2012 | 2013 | 2014
-------------- | ------ | ------ | ------ | ------ | ------ | ------
jkhy | 100.00 | 116.85 | 148.92 | 173.67 | 240.25 | 307.57
old peer group | 100.00 | 112.45 | 150.77 | 176.12 | 220.42 | 275.73
new peer group | 100.00 | 115.50 | 159.31 | 171.86 | 198.72 | 273.95
s & p 500 | 100.00 | 114.43 | 149.55 | 157.70 | 190.18 | 236.98
this comparison assumes $ 100 was invested on june 30 , 2009 , and assumes reinvestments of dividends .
total returns are calculated according to market capitalization of peer group members at the beginning of each period .
peer companies selected are in the business of providing specialized computer software , hardware and related services to financial institutions and other businesses .
in fiscal 2014 , we changed our peer group of companies used for this analysis to maintain alignment with peer companies selected by our compensation committee for use in determining compensation for executive management .
companies in the new peer group are aci worldwide , inc. , bottomline technology , inc. , broadridge financial solutions , cardtronics , inc. , convergys corp. , corelogic , inc. , dst systems , inc. , euronet worldwide , inc. , fair isaac corp. , fidelity national information services , inc. , fiserv , inc. , global payments , inc. , heartland payment systems , inc. , micros systems , inc. , moneygram international , inc. , ss&c technologies holdings , inc. , total systems services , inc. , tyler technologies , inc. , verifone systems , inc. , and wex , inc. .
companies in the old peer group are aci worldwide , inc. , bottomline technology , inc. , cerner corp. , dst systems , inc. , euronet worldwide , inc. , fair isaac corp. , fidelity national information services , inc. , fiserv , inc. , sei investments company , telecommunications systems , inc. , and tyler technologies corp. |
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dd4ba96ca | amount of unrecognized tax benefit related to permanent differences because a portion of those unrecognized benefits relate to state tax matters .
it is reasonably possible that the liability for uncertain tax positions could increase or decrease in the next twelve months due to completion of tax authorities 2019 exams or the expiration of statutes of limitations .
management estimates that the liability for uncertain tax positions could decrease by $ 5 million within the next twelve months .
the consolidated federal income tax returns of the pnc financial services group , inc .
and subsidiaries through 2003 have been audited by the internal revenue service and we have resolved all disputed matters through the irs appeals division .
the internal revenue service is currently examining the 2004 through 2006 consolidated federal income tax returns of the pnc financial services group , inc .
and subsidiaries .
the consolidated federal income tax returns of national city corporation and subsidiaries through 2004 have been audited by the internal revenue service and we have reached agreement in principle on resolution of all disputed matters through the irs appeals division .
however , because the agreement is still subject to execution of a closing agreement we have not treated it as effectively settled .
the internal revenue service is currently examining the 2005 through 2007 consolidated federal income tax returns of national city corporation and subsidiaries , and we expect the 2008 federal income tax return to begin being audited as soon as it is filed .
new york , new jersey , maryland and new york city are principally where we were subject to state and local income tax prior to our acquisition of national city .
the state of new york is currently in the process of closing the 2002 to 2004 audit and will begin auditing the years 2005 and 2006 .
new york city is currently auditing 2004 and 2005 .
however , years 2002 and 2003 remain subject to examination by new york city pending completion of the new york state audit .
through 2006 , blackrock is included in our new york and new york city combined tax filings and constituted most of the tax liability .
years subsequent to 2004 remain subject to examination by new jersey and years subsequent to 2005 remain subject to examination by maryland .
national city was principally subject to state and local income tax in california , florida , illinois , indiana , and missouri .
audits currently in process for these states include : california ( 2003-2004 ) , illinois ( 2004-2006 ) and missouri ( 2003-2005 ) .
we will now also be principally subject to tax in those states .
in the ordinary course of business we are routinely subject to audit by the taxing authorities of these states and at any given time a number of audits will be in process .
our policy is to classify interest and penalties associated with income taxes as income taxes .
at january 1 , 2008 , we had accrued $ 91 million of interest related to tax positions , most of which related to our cross-border leasing transactions .
the total accrued interest and penalties at december 31 , 2008 was $ 164 million .
while the leasing related interest decreased with a payment to the irs , the $ 73 million net increase primarily resulted from our acquisition of national city .
note 22 summarized financial information of blackrock as required by sec regulation s-x , summarized consolidated financial information of blackrock follows ( in millions ) . .
december 31 | 2008 | 2007
----------------------------------------------------------------------- | ------------ | -------
total assets | $ 19924 | $ 22561
total liabilities | $ 7367 | $ 10387
non-controlling interest | 491 | 578
stockholders 2019 equity | 12066 | 11596
total liabilities non-controlling interest and stockholders 2019 equity | $ 19924 | $ 22561
year ended december 31 | 2008 | 2007
total revenue | $ 5064 | $ 4845
total expenses | 3471 | 3551
operating income | 1593 | 1294
non-operating income ( expense ) | -574 ( 574 ) | 529
income before income taxes and non-controlling interest | 1019 | 1823
income taxes | 388 | 464
non-controlling interest | -155 ( 155 ) | 364
net income | $ 786 | $ 995
note 23 regulatory matters we are subject to the regulations of certain federal and state agencies and undergo periodic examinations by such regulatory authorities .
the access to and cost of funding new business initiatives including acquisitions , the ability to pay dividends , the level of deposit insurance costs , and the level and nature of regulatory oversight depend , in large part , on a financial institution 2019s capital strength .
the minimum us regulatory capital ratios are 4% ( 4 % ) for tier 1 risk-based , 8% ( 8 % ) for total risk- based and 4% ( 4 % ) for leverage .
however , regulators may require higher capital levels when particular circumstances warrant .
to qualify as 201cwell capitalized , 201d regulators require banks to maintain capital ratios of at least 6% ( 6 % ) for tier 1 risk-based , 10% ( 10 % ) for total risk-based and 5% ( 5 % ) for leverage .
at december 31 , 2008 and december 31 , 2007 , each of our domestic bank subsidiaries met the 201cwell capitalized 201d capital ratio requirements. |
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dd4bb6e6a | vornado realty trust notes to consolidated financial statements ( continued ) 10 .
redeemable noncontrolling interests - continued redeemable noncontrolling interests on our consolidated balance sheets are recorded at the greater of their carrying amount or redemption value at the end of each reporting period .
changes in the value from period to period are charged to 201cadditional capital 201d in our consolidated statements of changes in equity .
below is a table summarizing the activity of redeemable noncontrolling interests .
( amounts in thousands ) .
balance at december 31 2009 | $ 1251628
------------------------------------------------------------------ | ------------------
net income | 55228
distributions | -53515 ( 53515 )
conversion of class a units into common shares at redemption value | -126764 ( 126764 )
adjustment to carry redeemable class a units at redemption value | 191826
redemption of series d-12 redeemable units | -13000 ( 13000 )
other net | 22571
balance at december 31 2010 | 1327974
net income | 55912
distributions | -50865 ( 50865 )
conversion of class a units into common shares at redemption value | -64830 ( 64830 )
adjustment to carry redeemable class a units at redemption value | -98092 ( 98092 )
redemption of series d-11 redeemable units | -28000 ( 28000 )
other net | 18578
balance at december 31 2011 | $ 1160677
redeemable noncontrolling interests exclude our series g convertible preferred units and series d-13 cumulative redeemable preferred units , as they are accounted for as liabilities in accordance with asc 480 , distinguishing liabilities and equity , because of their possible settlement by issuing a variable number of vornado common shares .
accordingly , the fair value of these units is included as a component of 201cother liabilities 201d on our consolidated balance sheets and aggregated $ 54865000 and $ 55097000 as of december 31 , 2011 and 2010 , respectively. |
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dd4bd3d9e | notes to consolidated financial statements 2014 ( continued ) ( amounts in millions , except per share amounts ) litigation settlement 2014 during may 2008 , the sec concluded its investigation that began in 2002 into our financial reporting practices , resulting in a settlement charge of $ 12.0 .
investment impairments 2014 in 2007 we realized an other-than-temporary charge of $ 5.8 relating to a $ 12.5 investment in auction rate securities , representing our total investment in auction rate securities .
for additional information see note 15 .
note 6 : intangible assets goodwill goodwill is the excess purchase price remaining from an acquisition after an allocation of purchase price has been made to identifiable assets acquired and liabilities assumed based on estimated fair values .
the changes in the carrying value of goodwill by segment for the years ended december 31 , 2008 and 2007 are as follows: .
| ian | cmg | total
------------------------------------------------------- | ---------------- | -------------- | ----------------
balance as of december 31 2006 | $ 2632.5 | $ 435.3 | $ 3067.8
current year acquisitions | 86.0 | 2014 | 86.0
contingent and deferred payments for prior acquisitions | 4.7 | 3.7 | 8.4
amounts allocated to business dispositions | -5.7 ( 5.7 ) | 2014 | -5.7 ( 5.7 )
other ( primarily foreign currency translation ) | 72.2 | 2.9 | 75.1
balance as of december 31 2007 | 2789.7 | 441.9 | 3231.6
current year acquisitions | 99.5 | 1.8 | 101.3
contingent and deferred payments for prior acquisitions | 28.9 | 1.1 | 30.0
amounts allocated to business dispositions | -0.4 ( 0.4 ) | 2014 | -0.4 ( 0.4 )
other ( primarily foreign currency translation ) | -127.7 ( 127.7 ) | -13.9 ( 13.9 ) | -141.6 ( 141.6 )
balance as of december 31 2008 | $ 2790.0 | $ 430.9 | $ 3220.9
during the latter part of the fourth quarter of 2008 our stock price declined significantly after our annual impairment review as of october 1 , 2008 , and our market capitalization was less than our book value as of december 31 , 2008 .
we considered whether there were any events or circumstances indicative of a triggering event and determined that the decline in stock price during the fourth quarter was an event that would 201cmore likely than not 201d reduce the fair value of our individual reporting units below their book value , requiring us to perform an interim impairment test for goodwill at the reporting unit level .
based on the interim impairment test conducted , we concluded that there was no impairment of our goodwill as of december 31 , 2008 .
we will continue to monitor our stock price as it relates to the reconciliation of our market capitalization and the fair values of our individual reporting units throughout 2009 .
during our annual impairment reviews as of october 1 , 2006 our discounted future operating cash flow projections at one of our domestic advertising reporting units indicated that the implied fair value of the goodwill at this reporting unit was less than its book value , primarily due to client losses , resulting in a goodwill impairment charge of $ 27.2 in 2006 in our ian segment .
other intangible assets included in other intangible assets are assets with indefinite lives not subject to amortization and assets with definite lives subject to amortization .
other intangible assets include non-compete agreements , license costs , trade names and customer lists .
intangible assets with definitive lives subject to amortization are amortized on a |
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dd4c4ba38 | n o t e s t o c o n s o l i d a t e d f i n a n c i a l s t a t e m e n t s ( continued ) ace limited and subsidiaries there are no statutory restrictions on the payment of dividends from retained earnings by any of the bermuda subsidiaries as the minimum statutory capital and surplus requirements are satisfied by the share capital and additional paid-in capital of each of the bermuda subsidiaries .
the company 2019s u.s .
subsidiaries file financial statements prepared in accordance with statutory accounting practices prescribed or permitted by insurance regulators .
statutory accounting differs from gaap in the reporting of certain reinsurance contracts , investments , subsidiaries , acquis- ition expenses , fixed assets , deferred income taxes , and certain other items .
the statutory capital and surplus of the u.s .
subsidiaries met regulatory requirements for 2008 , 2007 , and 2006 .
the amount of dividends available to be paid in 2009 , without prior approval from the state insurance departments , totals $ 835 million .
the combined statutory capital and surplus and statutory net income of the bermuda and u.s .
subsidiaries as of and for the years ended december 31 , 2008 , 2007 , and 2006 , are as follows: .
( in millions of u.s . dollars ) | bermuda subsidiaries 2008 | bermuda subsidiaries 2007 | bermuda subsidiaries 2006 | bermuda subsidiaries 2008 | bermuda subsidiaries 2007 | 2006
-------------------------------- | ------------------------- | ------------------------- | ------------------------- | ------------------------- | ------------------------- | ------
statutory capital and surplus | $ 7001 | $ 8579 | $ 7605 | $ 5337 | $ 5321 | $ 4431
statutory net income | $ 684 | $ 1535 | $ 1527 | $ 798 | $ 873 | $ 724
as permitted by the restructuring discussed previously in note 7 , certain of the company 2019s u.s .
subsidiaries discount certain a&e liabilities , which increased statutory capital and surplus by approximately $ 211 million , $ 140 million , and $ 157 million as of december 31 , 2008 , 2007 , and 2006 , respectively .
the company 2019s international subsidiaries prepare statutory financial statements based on local laws and regulations .
some jurisdictions impose complex regulatory requirements on insurance companies while other jurisdictions impose fewer requirements .
in some countries , the company must obtain licenses issued by governmental authorities to conduct local insurance business .
these licenses may be subject to reserves and minimum capital and solvency tests .
jurisdictions may impose fines , censure , and/or criminal sanctions for violation of regulatory requirements .
other disclosures required by swiss law ( i ) expenses total personnel expenses amounted to $ 1.4 billion for the year ended december 31 , 2008 , and $ 1.1 billion for each of the years ended december 31 , 2007 and 2006 .
amortization expense related to tangible property amounted to $ 90 million , $ 77 million , and $ 64 million for the years ended december 31 , 2008 , 2007 , and 2006 , respectively .
( ii ) fire insurance values of property and equipment total fire insurance values of property and equipment amounted to $ 680 million and $ 464 million at december 31 , 2008 and 2007 , respectively .
( iii ) risk assessment and management the management of ace is responsible for assessing risks related to the financial reporting process and for establishing and maintaining adequate internal control over financial reporting .
internal control over financial reporting is a process designed by , or under the supervision of the chief executive officer and chief financial officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of ace 2019s consolidated financial statements for external purposes in accordance with gaap .
the board , operating through its audit committee composed entirely of directors who are not officers or employees of the company , provides oversight of the financial reporting process and safeguarding of assets against unauthorized acquisition , use , or disposition .
the audit committee meets with management , the independent registered public accountants and the internal auditor ; approves the overall scope of audit work and related fee arrangements ; and reviews audit reports and findings .
in addition , the independent registered public accountants and the internal auditor meet separately with the audit committee , without management representatives present , to discuss the results of their audits ; the adequacy of the company 2019s internal control ; the quality of its financial reporting ; and the safeguarding of assets against unauthorized acquisition , use , or dis- position .
ace 2019s management is responsible for assessing operational risks facing the company and sets policies designed to address such risks .
examples of key areas addressed by ace 2019s risk management processes follow. |
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dd4c24e1a | issuer purchases of equity securities in january 2017 , our board of directors authorized the repurchase of shares of our common stock with a value of up to $ 525 million in the aggregate .
as of december 29 , 2018 , $ 175 million remained available under this authorization .
in february 2019 , our board of directors authorized the additional repurchase of shares of our common stock with a value of up to $ 500.0 million in the aggregate .
the actual timing and amount of repurchases are subject to business and market conditions , corporate and regulatory requirements , stock price , acquisition opportunities and other factors .
the following table presents repurchases made under our current authorization and shares surrendered by employees to satisfy income tax withholding obligations during the three months ended december 29 , 2018 : period total number of shares purchased ( 1 ) average price paid per share ( 2 ) total number of shares purchased as part of publicly announced plan or program maximum dollar value of shares authorized for repurchase under publicly announced plan or program ( 1 ) ( in millions ) september 30 , 2018 2013 november 3 , 2018 543900 $ 42.64 495543 $ 254 november 4 , 2018 2013 december 1 , 2018 650048 $ 44.49 623692 $ 226 december 2 , 2018 2013 december 29 , 2018 1327657 $ 42.61 1203690 $ 175 .
period | total numberof sharespurchased ( 1 ) | averageprice paidper share ( 2 ) | total number ofshares purchasedas part ofpublicly announcedplan or program | maximum dollarvalue of sharesauthorized for repurchase underpublicly announcedplan or program ( 1 ) ( in millions )
-------------------------------------- | ------------------------------------ | -------------------------------- | -------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------
september 30 2018 2013 november 3 2018 | 543900 | $ 42.64 | 495543 | $ 254
november 4 2018 2013 december 1 2018 | 650048 | $ 44.49 | 623692 | $ 226
december 2 2018 2013 december 29 2018 | 1327657 | $ 42.61 | 1203690 | $ 175
total | 2521605 | $ 43.10 | 2322925 |
( 1 ) shares purchased that were not part of our publicly announced repurchase programs represent employee surrender of shares of restricted stock to satisfy employee income tax withholding obligations due upon vesting , and do not reduce the dollar value that may yet be purchased under our publicly announced repurchase programs .
( 2 ) the weighted average price paid per share of common stock does not include the cost of commissions. |
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dd4c5c3b0 | entergy corporation and subsidiaries management's financial discussion and analysis net revenue utility following is an analysis of the change in net revenue comparing 2011 to 2010 .
amount ( in millions ) .
| amount ( in millions )
------------------------------------- | ----------------------
2010 net revenue | $ 5051
mark-to-market tax settlement sharing | -196 ( 196 )
purchased power capacity | -21 ( 21 )
net wholesale revenue | -14 ( 14 )
volume/weather | 13
ano decommissioning trust | 24
retail electric price | 49
other | -2 ( 2 )
2011 net revenue | $ 4904
the mark-to-market tax settlement sharing variance results from a regulatory charge because a portion of the benefits of a settlement with the irs related to the mark-to-market income tax treatment of power purchase contracts will be shared with customers , slightly offset by the amortization of a portion of that charge beginning in october 2011 .
see notes 3 and 8 to the financial statements for additional discussion of the settlement and benefit sharing .
the purchased power capacity variance is primarily due to price increases for ongoing purchased power capacity and additional capacity purchases .
the net wholesale revenue variance is primarily due to lower margins on co-owner contracts and higher wholesale energy costs .
the volume/weather variance is primarily due to an increase of 2061 gwh in weather-adjusted usage across all sectors .
weather-adjusted residential retail sales growth reflected an increase in the number of customers .
industrial sales growth has continued since the beginning of 2010 .
entergy 2019s service territory has benefited from the national manufacturing economy and exports , as well as industrial facility expansions .
increases have been offset to some extent by declines in the paper , wood products , and pipeline segments .
the increase was also partially offset by the effect of less favorable weather on residential sales .
the ano decommissioning trust variance is primarily related to the deferral of investment gains from the ano 1 and 2 decommissioning trust in 2010 in accordance with regulatory treatment .
the gains resulted in an increase in interest and investment income in 2010 and a corresponding increase in regulatory charges with no effect on net income .
the retail electric price variance is primarily due to : rate actions at entergy texas , including a base rate increase effective august 2010 and an additional increase beginning may 2011 ; a formula rate plan increase at entergy louisiana effective may 2011 ; and a base rate increase at entergy arkansas effective july 2010 .
these were partially offset by formula rate plan decreases at entergy new orleans effective october 2010 and october 2011 .
see note 2 to the financial statements for further discussion of these proceedings. |
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dd4bbfcae | note 6 2014mergers and acquisitions eldertrust merger on february 5 , 2004 , the company consummated a merger transaction in an all cash transaction valued at $ 184 million ( the 201celdertrust transaction 201d ) .
the eldertrust transaction adds nine assisted living facilities , one independent living facility , five skilled nursing facilities , two med- ical office buildings and a financial office building ( the 201celdertrust properties 201d ) to the company 2019s portfolio.the eldertrust properties are leased by the company to various operators under leases providing for aggregated , annual cash base rent of approxi- mately $ 16.2 million , subject to escalation as provided in the leases.the leases have remaining terms primarily ranging from four to 11 years.at the closing of the eldertrust transaction , the company also acquired all of the limited partnership units in eldertrust operating limited partnership ( 201cetop 201d ) directly from their owners at $ 12.50 per unit , excluding 31455 class c units in etop ( which will remain outstanding ) .
etop owns directly or indirectly all of the eldertrust properties .
the company funded the $ 101 million equity portion of the purchase price with cash on eldertrust 2019s balance sheet , a portion of the $ 85 million in proceeds from its december 2003 sale of ten facilities to kindred and draws on the company 2019s revolving credit facility ( the 201crevolving credit facility 201d ) under its second amended and restated security and guaranty agreement , dated as of april 17 , 2002 ( the 201c2002 credit agreement 201d ) .the company 2019s ownership of the eldertrust properties is subject to approximately $ 83 million of property level debt and other liabilities.at the close of the eldertrust transaction , eldertrust had approximately $ 33.5 million in unrestricted and restricted cash on hand .
the acquisition was accounted for under the purchase method .
the following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of acquisition .
such estimates are subject to refinement as additional valuation information is received .
operations from this merger will be reflected in the company 2019s consolidated financial state- ments for periods subsequent to the acquisition date of february 5 , 2004.the company is in the process of computing fair values , thus , the allocation of the purchase price is subject to refinement. .
| ( in millions )
---------------------------------------------- | ---------------
real estate investments | $ 162
cash and cash equivalents | 28
other assets | 5
total assets acquired | $ 195
notes payable and other debt | 83
accounts payable and other accrued liabilities | 2
total liabilities assumed | 85
net assets acquired | $ 110
transaction with brookdale on january 29 , 2004 , the company entered into 14 definitive purchase agreements ( each , a 201cbrookdale purchase agreement 201d ) with certain affiliates of brookdale living communities , inc .
( 201cbrookdale 201d ) to purchase ( each such purchase , a 201cbrookdale acquisition 201d ) a total of 14 independent living or assisted living facilities ( each , a 201cbrookdale facility 201d ) for an aggregate purchase price of $ 115 million.affiliates of brookdale have agreed to lease and operate the brookdale facilities pursuant to one or more triple-net leases.all of the brookdale leases , which have an initial term of 15 years , will be guaranteed by brookdale and provide for aggregated annual base rent of approximately $ 10 million , escalating each year by the greater of ( i ) 1.5% ( 1.5 % ) or ( ii ) 75% ( 75 % ) of the consumer price index .
the company expects to fund the brookdale acquisitions by assuming an aggregate of approximately $ 41 million of non- recourse property level debt on certain of the brookdale facilities , with the balance to be paid from cash on hand and/or draws on the revolving credit facility.the property level debt encumbers seven of the brookdale facilities .
on january 29 , 2004 , the company completed the acquisitions of four brookdale facilities for an aggregate purchase price of $ 37 million.the company 2019s acquisition of the remaining ten brookdale facilities is expected to be completed shortly , subject to customary closing conditions .
however , the consummation of each such brookdale acquisition is not conditioned upon the consummation of any other such brookdale acquisition and there can be no assurance which , if any , of such remaining brookdale acquisitions will be consummated or when they will be consummated .
transactions with trans healthcare , inc .
on november 4 , 2002 , the company , through its wholly owned subsidiary ventas realty , completed a $ 120.0 million transaction ( the 201cthi transaction 201d ) with trans healthcare , inc. , a privately owned long-term care and hospital company ( 201cthi 201d ) .the thi transaction was structured as a $ 53.0 million sale leaseback trans- action ( the 201cthi sale leaseback 201d ) and a $ 67.0 million loan ( the 201cthi loan 201d ) , comprised of a first mortgage loan ( the 201cthi senior loan 201d ) and a mezzanine loan ( the 201cthi mezzanine loan 201d ) .
following a sale of the thi senior loan in december 2002 ( see below ) , the company 2019s investment in thi was $ 70.0 million .
as part of the thi sale leasebackventas realty purchased 5 properties and is leasing them back to thi under a 201ctriple-net 201d master lease ( the 201cthi master lease 201d ) .the properties subject to the sale leaseback are four skilled nursing facilities and one con- tinuing care retirement community.the thi master lease , which has an initial term of ten years , provides for annual base rent of $ 5.9 million.the thi master lease provides that if thi meets specified revenue parameters , annual base rent will escalate each year by the greater of ( i ) three percent or ( ii ) 50% ( 50 % ) of the consumer price index .
ventas , inc .
page 37 annual report 2003 |
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dd4bdec9e | 22 2002subsequent events in january 2011 , we purchased cif 2019s 49.9% ( 49.9 % ) interest in 521 fifth avenue , thereby assuming full ownership of the building .
the transaction values the consolidated interest at approximately $ 245.7 a0million .
in january 2011 , we repaid our $ 84.8 a0million , 5.15% ( 5.15 % ) unsecured notes at par on their maturity date .
in january 2011 , we , along with the moinian group , completed the recapitalization of 3 columbus circle .
the recapitalization included a $ 138 a0million equity investment by sl a0green , a portion of which was in the form of sl a0green operating partnership units .
we believe the property is now fully capitalized for all costs necessary to complete the redevelop- ment and lease-up of the building .
the previously existing mortgage has been refinanced with a bridge loan provided by sl a0green and deutsche bank , which we intend to be further refinanced by third-party lenders at a later date .
on february a010 , 2011 , the company and the operating partnership entered into atm equity offering sales agreements with each of merrill lynch , pierce , fenner a0& smith incorporated and morgan stanley a0& a0co .
incorporated , to sell shares of the company 2019s common stock , from time to time , through a $ 250.0 a0 million 201cat the market 201d equity offering program under which merrill lynch , pierce , fenner a0& smith incorporated and morgan stanley a0& a0co .
incorporated are acting as sales agents .
as of february a022 , 2011 , we sold approximately 2.0 a0million shares our common stock through the program for aggregate proceeds of $ 144.1 a0million .
2009 quarter ended december a031 september a030 june a030 march a031 .
2009 quarter ended | december 31 | september 30 | june 30 | march 31
-------------------------------------------------------------------------------------------- | ---------------- | ---------------- | ---------------- | ----------------
total revenues | $ 243040 | $ 245769 | $ 248251 | $ 258787
income ( loss ) net of noncontrolling interests and before gains on sale | -380 ( 380 ) | 4099 | -10242 ( 10242 ) | -26600 ( 26600 )
equity in net gain ( loss ) on sale of interest in unconsolidated joint venture/ real estate | 2014 | -157 ( 157 ) | -2693 ( 2693 ) | 9541
gain on early extinguishment of debt | 606 | 8368 | 29321 | 47712
gain ( loss ) on equity investment in marketable securities | -232 ( 232 ) | -52 ( 52 ) | 127 | -807 ( 807 )
net income from discontinued operations | 1593 | 1863 | 999 | 1319
gain ( loss ) on sale of discontinued operations | -1741 ( 1741 ) | -11672 ( 11672 ) | 2014 | 6572
net income ( loss ) attributable to sl green | -154 ( 154 ) | 2449 | 17512 | 37737
preferred stock dividends | -4969 ( 4969 ) | -4969 ( 4969 ) | -4969 ( 4969 ) | -4969 ( 4969 )
net income ( loss ) attributable to sl green common stockholders | $ -5123 ( 5123 ) | $ -2520 ( 2520 ) | $ 12543 | $ 32768
net income ( loss ) per common share-basic | $ -0.07 ( 0.07 ) | $ -0.03 ( 0.03 ) | $ 0.19 | $ 0.57
net income ( loss ) per common share-diluted | $ -0.07 ( 0.07 ) | $ -0.03 ( 0.03 ) | $ 0.18 | $ 0.57
88 sl green realty corp .
2010 annual report notes to consolidated financial statements |
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dd4c03b7a | natural gas prices on average were lower in 2009 than in 2008 and in 2007 , with prices in 2008 hitting uniquely high levels .
a significant portion of our natural gas production in the lower 48 states of the u.s .
is sold at bid-week prices or first-of-month indices relative to our specific producing areas .
a large portion of natural gas sales in alaska are subject to term contracts .
our other major natural gas-producing regions are europe and equatorial guinea , where large portions of our natural gas sales are also subject to term contracts , making realized prices in these areas less volatile .
as we sell larger quantities of natural gas from these regions , to the extent that these fixed prices are lower than prevailing prices , our reported average natural gas prices realizations may be less than benchmark natural gas prices .
oil sands mining oil sands mining segment revenues correlate with prevailing market prices for the various qualities of synthetic crude oil and vacuum gas oil we produce .
roughly two-thirds of the normal output mix will track movements in wti and one-third will track movements in the canadian heavy sour crude oil marker , primarily western canadian select .
output mix can be impacted by operational problems or planned unit outages at the mine or the upgrader .
the operating cost structure of the oil sands mining operations is predominantly fixed and therefore many of the costs incurred in times of full operation continue during production downtime .
per-unit costs are sensitive to production rates .
key variable costs are natural gas and diesel fuel , which track commodity markets such as the canadian aeco natural gas sales index and crude prices respectively .
the table below shows average benchmark prices that impact both our revenues and variable costs. .
benchmark | 2009 | 2008 | 2007
-------------------------------------------------------- | ------- | ------- | -------
wti crude oil ( dollars per barrel ) | $ 62.09 | $ 99.75 | $ 72.41
western canadian select ( dollars per barrel ) ( a ) | $ 52.13 | $ 79.59 | $ 49.60
aeco natural gas sales index ( dollars per mmbtu ) ( b ) | $ 3.49 | $ 7.74 | $ 6.06
western canadian select ( dollars per barrel ) ( a ) $ 52.13 $ 79.59 $ 49.60 aeco natural gas sales index ( dollars per mmbtu ) ( b ) $ 3.49 $ 7.74 $ 6.06 ( a ) monthly pricing based upon average wti adjusted for differentials unique to western canada .
( b ) alberta energy company day ahead index .
integrated gas our integrated gas strategy is to link stranded natural gas resources with areas where a supply gap is emerging due to declining production and growing demand .
our integrated gas operations include marketing and transportation of products manufactured from natural gas , such as lng and methanol , primarily in west africa , the u.s .
and europe .
our most significant lng investment is our 60 percent ownership in a production facility in equatorial guinea , which sells lng under a long-term contract at prices tied to henry hub natural gas prices .
in 2009 , the gross sales from the plant were 3.9 million metric tonnes , while in 2008 , its first full year of operations , the plant sold 3.4 million metric tonnes .
industry estimates of 2009 lng trade are approximately 185 million metric tonnes .
more lng production facilities and tankers were under construction in 2009 .
as a result of the sharp worldwide economic downturn in 2008 , continued weak economies are expected to lower natural gas consumption in various countries ; therefore , affecting near-term demand for lng .
long-term lng supply continues to be in demand as markets seek the benefits of clean burning natural gas .
market prices for lng are not reported or posted .
in general , lng delivered to the u.s .
is tied to henry hub prices and will track with changes in u.s .
natural gas prices , while lng sold in europe and asia is indexed to crude oil prices and will track the movement of those prices .
we own a 45 percent interest in a methanol plant located in equatorial guinea through our investment in ampco .
gross sales of methanol from the plant totaled 960374 metric tonnes in 2009 and 792794 metric tonnes in 2008 .
methanol demand has a direct impact on ampco 2019s earnings .
because global demand for methanol is rather limited , changes in the supply-demand balance can have a significant impact on sales prices .
the 2010 chemical markets associates , inc .
estimates world demand for methanol in 2009 was 41 million metric tonnes .
our plant capacity is 1.1 million , or about 3 percent of total demand .
refining , marketing and transportation rm&t segment income depends largely on our refining and wholesale marketing gross margin , refinery throughputs and retail marketing gross margins for gasoline , distillates and merchandise. |
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dd4c3010c | we believe that the presentation of adjusted diluted earnings per share , which excludes withdrawal costs 2013 multiemployer pension funds , restructuring charges , loss on extinguishment of debt , and ( gain ) loss on business dispositions and impairments , net , provides an understanding of operational activities before the financial effect of certain items .
we use this measure , and believe investors will find it helpful , in understanding the ongoing performance of our operations separate from items that have a disproportionate effect on our results for a particular period .
we have incurred comparable charges and costs in prior periods , and similar types of adjustments can reasonably be expected to be recorded in future periods .
our definition of adjusted diluted earnings per share may not be comparable to similarly titled measures presented by other companies .
property and equipment , net in 2017 , we anticipate receiving approximately $ 975 million of property and equipment , net of proceeds from sales of property and equipment , as follows: .
trucks and equipment | $ 350
----------------------------------------------------------- | ----------
landfill | 330
containers | 160
facilities and other | 150
property and equipment received during 2017 | 990
proceeds from sales of property and equipment | -15 ( 15 )
property and equipment received net of proceeds during 2017 | $ 975
results of operations revenue we generate revenue primarily from our solid waste collection operations .
our remaining revenue is from other services , including transfer station , landfill disposal , recycling , and energy services .
our residential and small- container commercial collection operations in some markets are based on long-term contracts with municipalities .
certain of our municipal contracts have annual price escalation clauses that are tied to changes in an underlying base index such as a consumer price index .
we generally provide small-container commercial and large-container industrial collection services to customers under contracts with terms up to three years .
our transfer stations , landfills and , to a lesser extent , our recycling facilities generate revenue from disposal or tipping fees charged to third parties .
in general , we integrate our recycling operations with our collection operations and obtain revenue from the sale of recycled commodities .
our revenue from energy services consists mainly of fees we charge for the treatment of liquid and solid waste derived from the production of oil and natural gas .
other revenue consists primarily of revenue from national accounts , which represents the portion of revenue generated from nationwide or regional contracts in markets outside our operating areas where the associated waste handling services are subcontracted to local operators .
consequently , substantially all of this revenue is offset with related subcontract costs , which are recorded in cost of operations. |
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dd4bd929e | marathon oil corporation notes to consolidated financial statements stock-based performance unit awards 2013 during 2018 , 2017 and 2016 we granted 754140 , 563631 and 1205517 stock- based performance unit awards to officers .
at december 31 , 2018 , there were 1196176 units outstanding .
total stock-based performance unit awards expense was $ 13 million in 2018 , $ 8 million in 2017 and $ 6 million in 2016 .
the key assumptions used in the monte carlo simulation to determine the fair value of stock-based performance units granted in 2018 , 2017 and 2016 were: .
| 2018 | 2017 | 2016
------------------------------------------------------- | -------------- | -------------- | --------------
valuation date stock price | $ 14.17 | $ 14.17 | $ 14.17
expected annual dividend yield | 1.4% ( 1.4 % ) | 1.4% ( 1.4 % ) | 1.4% ( 1.4 % )
expected volatility | 39% ( 39 % ) | 43% ( 43 % ) | 52% ( 52 % )
risk-free interest rate | 2.5% ( 2.5 % ) | 2.6% ( 2.6 % ) | 2.4% ( 2.4 % )
fair value of stock-based performance units outstanding | $ 19.60 | $ 19.45 | $ 21.51
18 .
defined benefit postretirement plans and defined contribution plan we have noncontributory defined benefit pension plans covering substantially all domestic employees , as well as u.k .
employees who were hired before april 2010 .
certain employees located in e.g. , who are u.s .
or u.k .
based , also participate in these plans .
benefits under these plans are based on plan provisions specific to each plan .
for the u.k .
pension plan , the principal employer and plan trustees reached a decision to close the plan to future benefit accruals effective december 31 , 2015 .
we also have defined benefit plans for other postretirement benefits covering our u.s .
employees .
health care benefits are provided up to age 65 through comprehensive hospital , surgical and major medical benefit provisions subject to various cost- sharing features .
post-age 65 health care benefits are provided to certain u.s .
employees on a defined contribution basis .
life insurance benefits are provided to certain retiree beneficiaries .
these other postretirement benefits are not funded in advance .
employees hired after 2016 are not eligible for any postretirement health care or life insurance benefits. |
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dd4c61aa4 | part a0iii item a010 .
directors , executive officers and corporate governance for the information required by this item a010 with respect to our executive officers , see part a0i , item 1 .
of this report .
for the other information required by this item a010 , see 201celection of directors , 201d 201cnominees for election to the board of directors , 201d 201ccorporate governance 201d and 201csection a016 ( a ) beneficial ownership reporting compliance , 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
the proxy statement for our 2018 annual meeting will be filed within 120 a0days after the end of the fiscal year covered by this annual report on form 10-k .
item a011 .
executive compensation for the information required by this item a011 , see 201ccompensation discussion and analysis , 201d 201ccompensation committee report , 201d and 201cexecutive compensation 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
item a012 .
security ownership of certain beneficial owners and management and related stockholder matters for the information required by this item a012 with respect to beneficial ownership of our common stock , see 201csecurity ownership of certain beneficial owners and management 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
the following table sets forth certain information as of december a031 , 2017 regarding our equity plans : plan category number of securities to be issued upon exercise of outstanding options , warrants and rights weighted-average exercise price of outstanding options , warrants and rights number of securities remaining available for future issuance under equity compensation plans ( excluding securities reflected in column ( a ) ( b ) ( c ) equity compensation plans approved by security holders 1708928 $ 113.49 3629455 item a013 .
certain relationships and related transactions , and director independence for the information required by this item a013 , see 201ccertain transactions 201d and 201ccorporate governance 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
item a014 .
principal accounting fees and services for the information required by this item a014 , see 201caudit and non-audit fees 201d and 201caudit committee pre-approval procedures 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference. .
plan category | number of securitiesto be issued uponexercise ofoutstanding options warrants and rights ( a ) ( b ) | weighted-averageexercise price ofoutstanding options warrants and rights | number of securitiesremaining available forfuture issuance underequity compensationplans ( excludingsecurities reflected in column ( a ) ) ( c )
------------------------------------------------------ | --------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------
equity compensation plans approved by security holders | 1708928 | $ 113.49 | 3629455
part a0iii item a010 .
directors , executive officers and corporate governance for the information required by this item a010 with respect to our executive officers , see part a0i , item 1 .
of this report .
for the other information required by this item a010 , see 201celection of directors , 201d 201cnominees for election to the board of directors , 201d 201ccorporate governance 201d and 201csection a016 ( a ) beneficial ownership reporting compliance , 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
the proxy statement for our 2018 annual meeting will be filed within 120 a0days after the end of the fiscal year covered by this annual report on form 10-k .
item a011 .
executive compensation for the information required by this item a011 , see 201ccompensation discussion and analysis , 201d 201ccompensation committee report , 201d and 201cexecutive compensation 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
item a012 .
security ownership of certain beneficial owners and management and related stockholder matters for the information required by this item a012 with respect to beneficial ownership of our common stock , see 201csecurity ownership of certain beneficial owners and management 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
the following table sets forth certain information as of december a031 , 2017 regarding our equity plans : plan category number of securities to be issued upon exercise of outstanding options , warrants and rights weighted-average exercise price of outstanding options , warrants and rights number of securities remaining available for future issuance under equity compensation plans ( excluding securities reflected in column ( a ) ( b ) ( c ) equity compensation plans approved by security holders 1708928 $ 113.49 3629455 item a013 .
certain relationships and related transactions , and director independence for the information required by this item a013 , see 201ccertain transactions 201d and 201ccorporate governance 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference .
item a014 .
principal accounting fees and services for the information required by this item a014 , see 201caudit and non-audit fees 201d and 201caudit committee pre-approval procedures 201d in the proxy statement for our 2018 annual meeting , which information is incorporated herein by reference. |
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dd4bdcc0a | entergy corporation and subsidiaries notes to financial statements this difference as a regulatory asset or liability on an ongoing basis , resulting in a zero net balance for the regulatory asset at the end of the lease term .
the amount was a net regulatory liability of $ 61.6 million and $ 27.8 million as of december 31 , 2013 and 2012 , respectively .
as of december 31 , 2013 , system energy had future minimum lease payments ( reflecting an implicit rate of 5.13% ( 5.13 % ) ) , which are recorded as long-term debt , as follows : amount ( in thousands ) .
| amount ( in thousands )
------------------------------------------- | -----------------------
2014 | $ 51637
2015 | 52253
2016 | 13750
2017 | 13750
2018 | 13750
years thereafter | 247500
total | 392640
less : amount representing interest | 295226
present value of net minimum lease payments | $ 97414 |
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dd4c4b920 | 2007 annual report 61 warranties : snap-on provides product warranties for specific product lines and accrues for estimated future warranty costs in the period in which the sale is recorded .
see note 15 for further information on warranties .
minority interests and equity earnings ( loss ) of unconsolidated affiliates : 201cminority interests and equity earnings ( loss ) , net of tax 201d on the accompanying consolidated statements of earnings is comprised of the following : ( amounts in millions ) 2007 2006 2005 .
( amounts in millions ) | 2007 | 2006 | 2005
----------------------------------- | -------------- | -------------- | --------------
minority interests | $ -4.9 ( 4.9 ) | $ -3.7 ( 3.7 ) | $ -3.5 ( 3.5 )
equity earnings ( loss ) net of tax | 2.4 | 2014 | 2.1
total | $ -2.5 ( 2.5 ) | $ -3.7 ( 3.7 ) | $ -1.4 ( 1.4 )
minority interests in consolidated subsidiaries of $ 17.3 million as of december 29 , 2007 , and $ 16.8 million as of december 30 , 2006 , are included in 201cother long-term liabilities 201d on the accompanying consolidated balance sheets .
investments in unconsolidated affiliates of $ 30.7 million as of december 29 , 2007 , and $ 30.6 million as of december 30 , 2006 , are included in 201cother assets 201d on the accompanying consolidated balance sheets .
foreign currency translation : the financial statements of snap-on 2019s foreign subsidiaries are translated into u.s .
dollars in accordance with sfas no .
52 , 201cforeign currency translation . 201d assets and liabilities of foreign subsidiaries are translated at current rates of exchange , and income and expense items are translated at the average exchange rate for the period .
the resulting translation adjustments are recorded directly into 201caccumulated other comprehensive income ( loss ) 201d on the accompanying consolidated balance sheets .
foreign exchange transactions resulted in pretax losses of $ 1.7 million in 2007 and $ 1.2 million in 2006 , and a pretax gain of $ 0.7 million in 2005 .
foreign exchange transaction gains and losses are reported in 201cother income ( expense ) - net 201d on the accompanying consolidated statements of earnings .
income taxes : in the ordinary course of business there is inherent uncertainty in quantifying income tax positions .
we assess income tax positions and record tax benefits for all years subject to examination based upon management 2019s evaluation of the facts , circumstances and information available at the reporting dates .
for those tax positions where it is more-likely-than-not that a tax benefit will be sustained , we record the largest amount of tax benefit with a greater than 50% ( 50 % ) likelihood of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information .
for those income tax positions where it is not more-likely-than-not that a tax benefit will be sustained , no tax benefit is recognized in the financial statements .
when applicable , associated interest and penalties are recognized as a component of income tax expense .
accrued interest and penalties are included within the related tax liability in the accompanying consolidated balance sheets .
deferred income taxes are provided for temporary differences arising from differences in bases of assets and liabilities for tax and financial reporting purposes .
deferred income taxes are recorded on temporary differences using enacted tax rates in effect for the year in which the temporary differences are expected to reverse .
the effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date .
see note 8 for further information on income taxes .
per share data : basic earnings per share calculations were computed by dividing net earnings by the corresponding weighted-average number of common shares outstanding for the period .
the dilutive effect of the potential exercise of outstanding options to purchase common shares is calculated using the treasury stock method .
snap-on had dilutive shares as of year-end 2007 , 2006 and 2005 , of 731442 shares , 911697 shares and 584222 shares , respectively .
options to purchase 493544 shares , 23000 shares and 612892 shares of snap-on common stock for the fiscal years ended 2007 , 2006 and 2005 , respectively , were not included in the computation of diluted earnings per share as the exercise prices of the options were greater than the average market price of the common stock for the respective year and , as a result , the effect on earnings per share would be anti-dilutive .
stock-based compensation : effective january 1 , 2006 , the company adopted sfas no .
123 ( r ) , 201cshare-based payment , 201d using the modified prospective method .
sfas no .
123 ( r ) requires entities to recognize the cost of employee services in exchange for awards of equity instruments based on the grant-date fair value of those awards ( with limited exceptions ) .
that cost , based on the estimated number of awards that are expected to vest , is recognized over the period during which the employee is required to provide the service in exchange for the award .
no compensation cost is recognized for awards for which employees do not render the requisite service .
upon adoption , the grant-date fair value of employee share options |
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dd4b8e046 | interest expense , net was $ 26.4 million , $ 14.6 million , and $ 5.3 million for the years ended december 31 , 2016 , 2015 and 2014 , respectively .
interest expense includes the amortization of deferred financing costs , bank fees , capital and built-to-suit lease interest and interest expense under the credit and other long term debt facilities .
amortization of deferred financing costs was $ 1.2 million , $ 0.8 million , and $ 0.6 million for the years ended december 31 , 2016 , 2015 and 2014 , respectively .
the company monitors the financial health and stability of its lenders under the credit and other long term debt facilities , however during any period of significant instability in the credit markets lenders could be negatively impacted in their ability to perform under these facilities .
6 .
commitments and contingencies obligations under operating leases the company leases warehouse space , office facilities , space for its brand and factory house stores and certain equipment under non-cancelable operating leases .
the leases expire at various dates through 2033 , excluding extensions at the company 2019s option , and include provisions for rental adjustments .
the table below includes executed lease agreements for brand and factory house stores that the company did not yet occupy as of december 31 , 2016 and does not include contingent rent the company may incur at its stores based on future sales above a specified minimum or payments made for maintenance , insurance and real estate taxes .
the following is a schedule of future minimum lease payments for non-cancelable real property operating leases as of december 31 , 2016 as well as significant operating lease agreements entered into during the period after december 31 , 2016 through the date of this report : ( in thousands ) .
2017 | $ 114857
----------------------------------- | ---------
2018 | 127504
2019 | 136040
2020 | 133092
2021 | 122753
2022 and thereafter | 788180
total future minimum lease payments | $ 1422426
included in selling , general and administrative expense was rent expense of $ 109.0 million , $ 83.0 million and $ 59.0 million for the years ended december 31 , 2016 , 2015 and 2014 , respectively , under non-cancelable operating lease agreements .
included in these amounts was contingent rent expense of $ 13.0 million , $ 11.0 million and $ 11.0 million for the years ended december 31 , 2016 , 2015 and 2014 , respectively .
sports marketing and other commitments within the normal course of business , the company enters into contractual commitments in order to promote the company 2019s brand and products .
these commitments include sponsorship agreements with teams and athletes on the collegiate and professional levels , official supplier agreements , athletic event sponsorships and other marketing commitments .
the following is a schedule of the company 2019s future minimum payments under its sponsorship and other marketing agreements as of december 31 |
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dd4b9907c | sources of blackrock 2019s operating cash primarily include investment advisory , administration fees and securities lending revenue , performance fees , revenue from technology and risk management services , advisory and other revenue and distribution fees .
blackrock uses its cash to pay all operating expense , interest and principal on borrowings , income taxes , dividends on blackrock 2019s capital stock , repurchases of the company 2019s stock , capital expenditures and purchases of co-investments and seed investments .
for details of the company 2019s gaap cash flows from operating , investing and financing activities , see the consolidated statements of cash flows contained in part ii , item 8 of this filing .
cash flows from operating activities , excluding the impact of consolidated sponsored investment funds , primarily include the receipt of investment advisory and administration fees , securities lending revenue and performance fees offset by the payment of operating expenses incurred in the normal course of business , including year-end incentive compensation accrued for in the prior year .
cash outflows from investing activities , excluding the impact of consolidated sponsored investment funds , for 2017 were $ 517 million and primarily reflected $ 497 million of investment purchases , $ 155 million of purchases of property and equipment , $ 73 million related to the first reserve transaction and $ 29 million related to the cachematrix transaction , partially offset by $ 205 million of net proceeds from sales and maturities of certain investments .
cash outflows from financing activities , excluding the impact of consolidated sponsored investment funds , for 2017 were $ 3094 million , primarily resulting from $ 1.4 billion of share repurchases , including $ 1.1 billion in open market- transactions and $ 321 million of employee tax withholdings related to employee stock transactions , $ 1.7 billion of cash dividend payments and $ 700 million of repayments of long- term borrowings , partially offset by $ 697 million of proceeds from issuance of long-term borrowings .
the company manages its financial condition and funding to maintain appropriate liquidity for the business .
liquidity resources at december 31 , 2017 and 2016 were as follows : ( in millions ) december 31 , december 31 , cash and cash equivalents ( 1 ) $ 6894 $ 6091 cash and cash equivalents held by consolidated vres ( 2 ) ( 63 ) ( 53 ) .
( in millions ) | december 31 2017 | december 31 2016
--------------------------------------------------------- | ---------------- | ----------------
cash and cash equivalents ( 1 ) | $ 6894 | $ 6091
cash and cash equivalents held by consolidated vres ( 2 ) | -63 ( 63 ) | -53 ( 53 )
subtotal | 6831 | 6038
credit facility 2014 undrawn | 4000 | 4000
total liquidity resources ( 3 ) | $ 10831 | $ 10038
total liquidity resources ( 3 ) $ 10831 $ 10038 ( 1 ) the percentage of cash and cash equivalents held by the company 2019s u.s .
subsidiaries was approximately 40% ( 40 % ) and 50% ( 50 % ) at december 31 , 2017 and 2016 , respectively .
see net capital requirements herein for more information on net capital requirements in certain regulated subsidiaries .
( 2 ) the company cannot readily access such cash to use in its operating activities .
( 3 ) amounts do not reflect a reduction for year-end incentive compensation accruals of approximately $ 1.5 billion and $ 1.3 billion for 2017 and 2016 , respectively , which are paid in the first quarter of the following year .
total liquidity resources increased $ 793 million during 2017 , primarily reflecting cash flows from operating activities , partially offset by cash payments of 2016 year-end incentive awards , share repurchases of $ 1.4 billion and cash dividend payments of $ 1.7 billion .
a significant portion of the company 2019s $ 3154 million of total investments , as adjusted , is illiquid in nature and , as such , cannot be readily convertible to cash .
share repurchases .
the company repurchased 2.6 million common shares in open market transactions under the share repurchase program for approximately $ 1.1 billion during 2017 .
at december 31 , 2017 , there were 6.4 million shares still authorized to be repurchased .
net capital requirements .
the company is required to maintain net capital in certain regulated subsidiaries within a number of jurisdictions , which is partially maintained by retaining cash and cash equivalent investments in those subsidiaries or jurisdictions .
as a result , such subsidiaries of the company may be restricted in their ability to transfer cash between different jurisdictions and to their parents .
additionally , transfers of cash between international jurisdictions may have adverse tax consequences that could discourage such transfers .
blackrock institutional trust company , n.a .
( 201cbtc 201d ) is chartered as a national bank that does not accept client deposits and whose powers are limited to trust and other fiduciary activities .
btc provides investment management services , including investment advisory and securities lending agency services , to institutional clients .
btc is subject to regulatory capital and liquid asset requirements administered by the office of the comptroller of the currency .
at december 31 , 2017 and 2016 , the company was required to maintain approximately $ 1.8 billion and $ 1.4 billion , respectively , in net capital in certain regulated subsidiaries , including btc , entities regulated by the financial conduct authority and prudential regulation authority in the united kingdom , and the company 2019s broker-dealers .
the company was in compliance with all applicable regulatory net capital requirements .
undistributed earnings of foreign subsidiaries .
as a result of the 2017 tax act and the one-time mandatory deemed repatriation tax on untaxed accumulated foreign earnings , a provisional amount of u.s .
income taxes was provided on the undistributed foreign earnings .
the financial statement basis in excess of tax basis of its foreign subsidiaries remains indefinitely reinvested in foreign operations .
the company will continue to evaluate its capital management plans throughout 2018 .
short-term borrowings 2017 revolving credit facility .
the company 2019s credit facility has an aggregate commitment amount of $ 4.0 billion and was amended in april 2017 to extend the maturity date to april 2022 ( the 201c2017 credit facility 201d ) .
the 2017 credit facility permits the company to request up to an additional $ 1.0 billion of borrowing capacity , subject to lender credit approval , increasing the overall size of the 2017 credit facility to an aggregate principal amount not to exceed $ 5.0 billion .
interest on borrowings outstanding accrues at a rate based on the applicable london interbank offered rate plus a spread .
the 2017 credit facility requires the company |
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dd4bdb968 | in november 2016 , we issued $ 45 million of fixed rate term notes in two tranches to two insurance companies .
principal payments commence in 2023 and 2028 and the notes mature in 2029 and 2034 , respectively .
the notes carry interest rates of 2.87 and 3.10 , respectively .
we used proceeds of the notes to pay down borrowings under our revolving credit facility .
in january 2015 , we issued $ 75 million of fixed rate term notes to an insurance company .
principal payments commence in 2020 and the notes mature in 2030 .
the notes carry an interest rate of 3.52 percent .
we used proceeds of the notes to pay down borrowings under our revolving credit facility .
at december 31 , 2016 , we had available borrowing capacity of $ 310.8 million under this facility .
we believe that the combination of cash , available borrowing capacity and operating cash flow will provide sufficient funds to finance our existing operations for the foreseeable future .
our total debt increased to $ 323.6 million at december 31 , 2016 compared with $ 249.0 million at december 31 , 2015 , as our cash flows generated in the u.s were more than offset by our share repurchase activity and our purchase of aquasana .
as a result , our leverage , as measured by the ratio of total debt to total capitalization , was 17.6 percent at the end of 2016 compared with 14.7 percent at the end of 2015 .
our u.s .
pension plan continues to meet all funding requirements under erisa regulations .
we were not required to make a contribution to our pension plan in 2016 but made a voluntary $ 30 million contribution due to escalating pension benefit guaranty corporation insurance premiums .
we forecast that we will not be required to make a contribution to the plan in 2017 and we do not plan to make any voluntary contributions in 2017 .
for further information on our pension plans , see note 10 of the notes to consolidated financial statements .
during 2016 , our board of directors authorized the purchase of an additional 3000000 shares of our common stock .
in 2016 , we repurchased 3273109 shares at an average price of $ 41.30 per share and a total cost of $ 135.2 million .
a total of 4906403 shares remained on the existing repurchase authorization at december 31 , 2016 .
depending on factors such as stock price , working capital requirements and alternative investment opportunities , such as acquisitions , we expect to spend approximately $ 135 million on share repurchase activity in 2017 using a 10b5-1 repurchase plan .
in addition , we may opportunistically repurchase an additional $ 65 million of our shares in 2017 .
we have paid dividends for 77 consecutive years with payments increasing each of the last 25 years .
we paid dividends of $ 0.48 per share in 2016 compared with $ 0.38 per share in 2015 .
in january 2017 , we increased our dividend by 17 percent and anticipate paying dividends of $ 0.56 per share in 2017 .
aggregate contractual obligations a summary of our contractual obligations as of december 31 , 2016 , is as follows: .
( dollars in millions ) contractual obligations | ( dollars in millions ) total | ( dollars in millions ) less than1 year | ( dollars in millions ) 1 - 2years | ( dollars in millions ) 3 - 5years | more than5 years
----------------------------------------------- | ----------------------------- | --------------------------------------- | ---------------------------------- | ---------------------------------- | ----------------
long-term debt | $ 323.6 | $ 7.2 | $ 7.2 | $ 202.9 | $ 106.3
fixed rate interest | 38.6 | 4.6 | 8.1 | 7.2 | 18.7
operating leases | 37.4 | 19.5 | 7.9 | 4.2 | 5.8
purchase obligations | 150.8 | 141.4 | 5.8 | 3.6 | 2014
pension and post-retirement obligations | 66.0 | 0.9 | 9.5 | 8.6 | 47.0
total | $ 616.4 | $ 173.6 | $ 38.5 | $ 226.5 | $ 177.8
as of december 31 , 2016 , our liability for uncertain income tax positions was $ 4.2 million .
due to the high degree of uncertainty regarding timing of potential future cash flows associated with these liabilities , we are unable to make a reasonably reliable estimate of the amount and period in which these liabilities might be paid .
we utilize blanket purchase orders to communicate expected annual requirements to many of our suppliers .
requirements under blanket purchase orders generally do not become committed until several weeks prior to our scheduled unit production .
the purchase obligation amount presented above represents the value of commitments that we consider firm .
recent accounting pronouncements refer to recent accounting pronouncements in note 1 of notes to consolidated financial statements. |
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dd4bda392 | goodwill and intangible asset impairment charge during the third quarter of fiscal year 2017 , we determined that the goodwill and indefinite-lived intangible assets ( primarily acquired trade names ) associated with our latin america reporting unit of our industrial gases 2013 americas segment were impaired .
we recorded a noncash impairment charge of $ 162.1 ( $ 154.1 attributable to air products , after-tax , or $ .70 per share ) , which was driven by lower economic growth and profitability in the region .
this impairment charge has been excluded from segment results .
refer to note 10 , goodwill , and note 11 , intangible assets , to the consolidated financial statements for additional information .
other income ( expense ) , net items recorded to "other income ( expense ) , net" arise from transactions and events not directly related to our principal income earning activities .
the detail of "other income ( expense ) , net" is presented in note 23 , supplemental information , to the consolidated financial statements .
2018 vs .
2017 other income ( expense ) , net of $ 50.2 decreased $ 70.8 , primarily due to lower income from the transition services agreements with versum and evonik , lower income from the sale of assets and investments , lower favorable contract settlements , and an unfavorable foreign exchange impact .
2017 vs .
2016 other income ( expense ) , net of $ 121.0 increased $ 71.6 , primarily due to income from transition services agreements with versum and evonik , income from the sale of assets and investments , including a gain of $ 12.2 ( $ 7.6 after-tax , or $ .03 per share ) resulting from the sale of a parcel of land , and a favorable foreign exchange impact .
interest expense .
| 2018 | 2017 | 2016
--------------------------- | ------- | ------- | -------
interest incurred | $ 150.0 | $ 139.6 | $ 147.9
less : capitalized interest | 19.5 | 19.0 | 32.7
interest expense | $ 130.5 | $ 120.6 | $ 115.2
2018 vs .
2017 interest incurred increased $ 10.4 as project financing associated with the lu'an joint venture and a higher average interest rate on the debt portfolio were partially offset by the impact from a lower average debt balance .
the change in capitalized interest was driven by an increase in the carrying value of projects under construction .
2017 vs .
2016 interest incurred decreased $ 8.3 as the impact from a lower average debt balance of $ 26 was partially offset by the impact from a higher average interest rate on the debt portfolio of $ 19 .
the change in capitalized interest was driven by a decrease in the carrying value of projects under construction , primarily as a result of our decision to exit from the efw business .
other non-operating income ( expense ) , net 2018 vs .
2017 other non-operating income ( expense ) , net of $ 5.1 decreased $ 11.5 .
during the fourth quarter of fiscal year 2018 , we recognized a pension settlement loss of $ 43.7 ( $ 33.2 after-tax , or $ .15 per share ) that primarily resulted from the transfer of certain pension payment obligations to an insurer for our u.s .
salaried and hourly plans through the purchase of an irrevocable , nonparticipating group annuity contract with plan assets .
for additional information , refer to note 16 , retirement benefits , to the consolidated financial statements .
this loss was partially offset by higher interest income on cash and cash items and short-term investments and lower other non-service pension expense .
the prior year pension expense included a settlement loss of $ 10.5 ( $ 6.6 after-tax , or $ .03 per share ) associated with the u.s .
supplementary pension plan and a settlement benefit of $ 2.3 related to the disposition of emd and pmd. |
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dd4b9f7f6 | jpmorgan chase & co./2015 annual report 67 five-year stock performance the following table and graph compare the five-year cumulative total return for jpmorgan chase & co .
( 201cjpmorgan chase 201d or the 201cfirm 201d ) common stock with the cumulative return of the s&p 500 index , the kbw bank index and the s&p financial index .
the s&p 500 index is a commonly referenced united states of america ( 201cu.s . 201d ) equity benchmark consisting of leading companies from different economic sectors .
the kbw bank index seeks to reflect the performance of banks and thrifts that are publicly traded in the u.s .
and is composed of 24 leading national money center and regional banks and thrifts .
the s&p financial index is an index of 87 financial companies , all of which are components of the s&p 500 .
the firm is a component of all three industry indices .
the following table and graph assume simultaneous investments of $ 100 on december 31 , 2010 , in jpmorgan chase common stock and in each of the above indices .
the comparison assumes that all dividends are reinvested .
december 31 , ( in dollars ) 2010 2011 2012 2013 2014 2015 .
december 31 ( in dollars ) | 2010 | 2011 | 2012 | 2013 | 2014 | 2015
-------------------------- | -------- | ------- | -------- | -------- | -------- | --------
jpmorgan chase | $ 100.00 | $ 80.03 | $ 108.98 | $ 148.98 | $ 163.71 | $ 177.40
kbw bank index | 100.00 | 76.82 | 102.19 | 140.77 | 153.96 | 154.71
s&p financial index | 100.00 | 82.94 | 106.78 | 144.79 | 166.76 | 164.15
s&p 500 index | 100.00 | 102.11 | 118.44 | 156.78 | 178.22 | 180.67
december 31 , ( in dollars ) |
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dd4be90a4 | sales volumes in 2013 increased from 2012 , primarily for fluff pulp , reflecting improved market demand and a change in our product mix with a full year of fluff pulp production at our franklin , virginia mill .
average sales price realizations were lower for fluff pulp while prices for market pulp increased .
input costs for wood , fuels and chemicals were higher .
mill operating costs were significantly lower largely due to the absence of costs associated with the start-up of the franklin mill in 2012 .
planned maintenance downtime costs were higher .
in the first quarter of 2014 , sales volumes are expected to be slightly lower compared with the fourth quarter of 2013 .
average sales price realizations are expected to improve , reflecting the further realization of previously announced sales price increases for softwood pulp and fluff pulp .
input costs should be flat .
planned maintenance downtime costs should be about $ 11 million higher than in the fourth quarter of 2013 .
operating profits will also be negatively impacted by the severe winter weather in the first quarter of 2014 .
consumer packaging demand and pricing for consumer packaging products correlate closely with consumer spending and general economic activity .
in addition to prices and volumes , major factors affecting the profitability of consumer packaging are raw material and energy costs , freight costs , manufacturing efficiency and product mix .
consumer packaging net sales in 2013 increased 8% ( 8 % ) from 2012 , but decreased 7% ( 7 % ) from 2011 .
operating profits decreased 40% ( 40 % ) from 2012 and 1% ( 1 % ) from 2011 .
net sales and operating profits include the shorewood business in 2011 .
excluding costs associated with the permanent shutdown of a paper machine at our augusta , georgia mill and costs associated with the sale of the shorewood business , 2013 operating profits were 22% ( 22 % ) lower than in 2012 , and 43% ( 43 % ) lower than in 2011 .
benefits from higher sales volumes ( $ 45 million ) were offset by lower average sales price realizations and an unfavorable mix ( $ 50 million ) , higher operating costs including incremental costs resulting from the shutdown of a paper machine at our augusta , georgia mill ( $ 46 million ) and higher input costs ( $ 6 million ) .
in addition , operating profits in 2013 included restructuring costs of $ 45 million related to the permanent shutdown of a paper machine at our augusta , georgia mill and $ 2 million of costs associated with the sale of the shorewood business .
operating profits in 2012 included a gain of $ 3 million related to the sale of the shorewood business , while operating profits in 2011 included a $ 129 million fixed asset impairment charge for the north american shorewood business and $ 72 million for other charges associated with the sale of the shorewood business .
consumer packaging .
in millions | 2013 | 2012 | 2011
---------------- | ------ | ------ | ------
sales | $ 3435 | $ 3170 | $ 3710
operating profit | 161 | 268 | 163
north american consumer packaging net sales were $ 2.0 billion in 2013 compared with $ 2.0 billion in 2012 and $ 2.5 billion in 2011 .
operating profits were $ 63 million ( $ 110 million excluding paper machine shutdown costs and costs related to the sale of the shorewood business ) in 2013 compared with $ 165 million ( $ 162 million excluding charges associated with the sale of the shorewood business ) in 2012 and $ 35 million ( $ 236 million excluding asset impairment charges and other costs associated with the sale of the shorewood business ) in 2011 .
coated paperboard sales volumes in 2013 were higher than in 2012 reflecting stronger market demand .
average sales price realizations were lower year-over- year despite the realization of price increases in the second half of 2013 .
input costs for wood and energy increased , but were partially offset by lower costs for chemicals .
planned maintenance downtime costs were slightly lower .
market-related downtime was about 24000 tons in 2013 compared with about 113000 tons in 2012 .
the permanent shutdown of a paper machine at our augusta , georgia mill in the first quarter of 2013 reduced capacity by 140000 tons in 2013 compared with 2012 .
foodservice sales volumes increased slightly in 2013 compared with 2012 despite softer market demand .
average sales margins were higher reflecting lower input costs for board and resins and a more favorable product mix .
operating costs and distribution costs were both higher .
the u.s.shorewood business was sold december 31 , 2011 and the non-u.s .
business was sold in january looking ahead to the first quarter of 2014 , coated paperboard sales volumes are expected to be seasonally weaker than in the fourth quarter of 2013 .
average sales price realizations are expected to be slightly higher , and margins should also benefit from a more favorable product mix .
input costs are expected to be higher for energy , chemicals and wood .
planned maintenance downtime costs should be $ 8 million lower with a planned maintenance outage scheduled at the augusta mill in the first quarter .
the severe winter weather in the first quarter of 2014 will negatively impact operating profits .
foodservice sales volumes are expected to be seasonally lower .
average sales margins are expected to improve due to the realization of sales price increases effective with our january contract openers and a more favorable product mix. |
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dd4bd30c4 | the city council 2019s advisors and entergy new orleans .
in february 2018 the city council approved the settlement , which deferred cost recovery to the 2018 entergy new orleans rate case , but also stated that an adjustment for 2018-2019 ami costs can be filed in the rate case and that , for all subsequent ami costs , the mechanism to be approved in the 2018 rate case will allow for the timely recovery of such costs .
sources of capital entergy new orleans 2019s sources to meet its capital requirements include : 2022 internally generated funds ; 2022 cash on hand ; 2022 debt and preferred membership interest issuances ; and 2022 bank financing under new or existing facilities .
entergy new orleans may refinance , redeem , or otherwise retire debt prior to maturity , to the extent market conditions and interest rates are favorable .
entergy new orleans 2019s receivables from the money pool were as follows as of december 31 for each of the following years. .
2017 | 2016 | 2015 | 2014
---------------- | ---------------- | ---------------- | ----------------
( in thousands ) | ( in thousands ) | ( in thousands ) | ( in thousands )
$ 12723 | $ 14215 | $ 15794 | $ 442
see note 4 to the financial statements for a description of the money pool .
entergy new orleans has a credit facility in the amount of $ 25 million scheduled to expire in november 2018 .
the credit facility allows entergy new orleans to issue letters of credit against $ 10 million of the borrowing capacity of the facility .
as of december 31 , 2017 , there were no cash borrowings and a $ 0.8 million letter of credit was outstanding under the facility .
in addition , entergy new orleans is a party to an uncommitted letter of credit facility as a means to post collateral to support its obligations to miso . a0 as of december 31 , 2017 , a $ 1.4 million letter of credit was outstanding under entergy new orleans 2019s letter of credit a0facility .
see note 4 to the financial statements for additional discussion of the credit facilities .
entergy new orleans obtained authorization from the ferc through october 2019 for short-term borrowings not to exceed an aggregate amount of $ 150 million at any time outstanding and long-term borrowings and securities issuances .
see note 4 to the financial statements for further discussion of entergy new orleans 2019s short-term borrowing limits .
the long-term securities issuances of entergy new orleans are limited to amounts authorized not only by the ferc , but also by the city council , and the current city council authorization extends through june 2018 .
entergy new orleans , llc and subsidiaries management 2019s financial discussion and analysis state and local rate regulation the rates that entergy new orleans charges for electricity and natural gas significantly influence its financial position , results of operations , and liquidity .
entergy new orleans is regulated and the rates charged to its customers are determined in regulatory proceedings .
a governmental agency , the city council , is primarily responsible for approval of the rates charged to customers .
retail rates see 201calgiers asset transfer 201d below for discussion of the algiers asset transfer .
as a provision of the settlement agreement approved by the city council in may 2015 providing for the algiers asset transfer , it was agreed that , with limited exceptions , no action may be taken with respect to entergy new orleans 2019s base rates until rates are implemented |
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dd4bb56f0 | entergy louisiana , llc and subsidiaries management 2019s financial discussion and analysis in industrial usage is primarily due to increased demand from new customers and expansion projects , primarily in the chemicals industry .
the louisiana act 55 financing savings obligation variance results from a regulatory charge for tax savings to be shared with customers per an agreement approved by the lpsc .
the tax savings resulted from the 2010-2011 irs audit settlement on the treatment of the louisiana act 55 financing of storm costs for hurricane gustav and hurricane ike .
see note 3 to the financial statements for additional discussion of the settlement and benefit sharing .
included in other is a provision of $ 23 million recorded in 2016 related to the settlement of the waterford 3 replacement steam generator prudence review proceeding , offset by a provision of $ 32 million recorded in 2015 related to the uncertainty at that time associated with the resolution of the waterford 3 replacement steam generator prudence review proceeding .
see note 2 to the financial statements for a discussion of the waterford 3 replacement steam generator prudence review proceeding .
2015 compared to 2014 net revenue consists of operating revenues net of : 1 ) fuel , fuel-related expenses , and gas purchased for resale , 2 ) purchased power expenses , and 3 ) other regulatory charges ( credits ) .
following is an analysis of the change in net revenue comparing 2015 to 2014 .
amount ( in millions ) .
| amount ( in millions )
------------------------------------------------- | ----------------------
2014 net revenue | $ 2246.1
retail electric price | 180.0
volume/weather | 39.5
waterford 3 replacement steam generator provision | -32.0 ( 32.0 )
miso deferral | -32.0 ( 32.0 )
other | 7.2
2015 net revenue | $ 2408.8
the retail electric price variance is primarily due to formula rate plan increases , as approved by the lpsc , effective december 2014 and january 2015 .
entergy louisiana 2019s formula rate plan increases are discussed in note 2 to the financial statements .
the volume/weather variance is primarily due to an increase of 841 gwh , or 2% ( 2 % ) , in billed electricity usage , as a result of increased industrial usage primarily due to increased demand for existing large refinery customers , new customers , and expansion projects primarily in the chemicals industry , partially offset by a decrease in demand in the chemicals industry as a result of a seasonal outage for an existing customer .
the waterford 3 replacement steam generator provision is due to a regulatory charge of approximately $ 32 million recorded in 2015 related to the uncertainty associated with the resolution of the waterford 3 replacement steam generator project .
see note 2 to the financial statements for a discussion of the waterford 3 replacement steam generator prudence review proceeding .
the miso deferral variance is due to the deferral in 2014 of non-fuel miso-related charges , as approved by the lpsc .
the deferral of non-fuel miso-related charges is partially offset in other operation and maintenance expenses .
see note 2 to the financial statements for further discussion of the recovery of non-fuel miso-related charges. |
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dd4b90f4e | ( 3 ) refer to note 2 201csummary of significant accounting principles and practices 201d for further information .
13 .
employee benefitsp y defined contribution savings plans aon maintains defined contribution savings plans for the benefit of its employees .
the expense recognized for these plans is included in compensation and benefits in the consolidated statements of income .
the expense for the significant plans in the u.s. , u.k. , netherlands and canada is as follows ( in millions ) : .
years ended december 31 | 2018 | 2017 | 2016
----------------------- | ----- | ----- | -----
u.s . | $ 98 | $ 105 | $ 121
u.k . | 45 | 43 | 43
netherlands and canada | 25 | 25 | 27
total | $ 168 | $ 173 | $ 191
pension and other postretirement benefits the company sponsors defined benefit pension and postretirement health and welfare plans that provide retirement , medical , and life insurance benefits .
the postretirement health care plans are contributory , with retiree contributions adjusted annually , and the aa life insurance and pension plans are generally noncontributory .
the significant u.s. , u.k. , netherlands and canadian pension plans are closed to new entrants. |
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dd4be3f3c | bhge 2017 form 10-k | 103 part iii item 10 .
directors , executive officers and corporate governance information regarding our code of conduct , the spirit and the letter , and code of ethical conduct certificates for our principal executive officer , principal financial officer and principal accounting officer are described in item 1 .
business of this annual report .
information concerning our directors is set forth in the sections entitled "proposal no .
1 , election of directors - board nominees for directors" and "corporate governance - committees of the board" in our definitive proxy statement for the 2018 annual meeting of stockholders to be filed with the sec pursuant to the exchange act within 120 days of the end of our fiscal year on december 31 , 2017 ( "proxy statement" ) , which sections are incorporated herein by reference .
for information regarding our executive officers , see "item 1 .
business - executive officers of baker hughes" in this annual report on form 10-k .
additional information regarding compliance by directors and executive officers with section 16 ( a ) of the exchange act is set forth under the section entitled "section 16 ( a ) beneficial ownership reporting compliance" in our proxy statement , which section is incorporated herein by reference .
item 11 .
executive compensation information for this item is set forth in the following sections of our proxy statement , which sections are incorporated herein by reference : "compensation discussion and analysis" "director compensation" "compensation committee interlocks and insider participation" and "compensation committee report." item 12 .
security ownership of certain beneficial owners and management and related stockholder matters information concerning security ownership of certain beneficial owners and our management is set forth in the sections entitled "stock ownership of certain beneficial owners" and 201cstock ownership of section 16 ( a ) director and executive officers 201d ) in our proxy statement , which sections are incorporated herein by reference .
we permit our employees , officers and directors to enter into written trading plans complying with rule 10b5-1 under the exchange act .
rule 10b5-1 provides criteria under which such an individual may establish a prearranged plan to buy or sell a specified number of shares of a company's stock over a set period of time .
any such plan must be entered into in good faith at a time when the individual is not in possession of material , nonpublic information .
if an individual establishes a plan satisfying the requirements of rule 10b5-1 , such individual's subsequent receipt of material , nonpublic information will not prevent transactions under the plan from being executed .
certain of our officers have advised us that they have and may enter into stock sales plans for the sale of shares of our class a common stock which are intended to comply with the requirements of rule 10b5-1 of the exchange act .
in addition , the company has and may in the future enter into repurchases of our class a common stock under a plan that complies with rule 10b5-1 or rule 10b-18 of the exchange act .
equity compensation plan information the information in the following table is presented as of december 31 , 2017 with respect to shares of our class a common stock that may be issued under our lti plan which has been approved by our stockholders ( in millions , except per share prices ) .
equity compensation plan category number of securities to be issued upon exercise of outstanding options , warrants and rights weighted average exercise price of outstanding options , warrants and rights number of securities remaining available for future issuance under equity compensation plans ( excluding securities reflected in the first column ) .
equity compensation plancategory | number ofsecurities to beissued uponexercise ofoutstandingoptions warrantsand rights | weighted averageexercise price ofoutstandingoptions warrantsand rights | number of securitiesremaining availablefor future issuanceunder equitycompensation plans ( excluding securitiesreflected in the firstcolumn )
-------------------------------- | ------------------------------------------------------------------------------------ | ---------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------
stockholder-approved plans | 1.6 | $ 36.61 | 53.7
nonstockholder-approved plans | 2014 | 2014 | 2014
total | 1.6 | $ 36.61 | 53.7 |
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dd4c354a4 | supplementary information on oil and gas producing activities ( unaudited ) c o n t i n u e d summary of changes in standardized measure of discounted future net cash flows relating to proved oil and gas reserves ( in millions ) 2006 2005 2004 sales and transfers of oil and gas produced , net of production , transportation and administrative costs $ ( 5312 ) $ ( 3754 ) $ ( 2689 ) net changes in prices and production , transportation and administrative costs related to future production ( 1342 ) 6648 771 .
( in millions ) | 2006 | 2005 | 2004
--------------------------------------------------------------------------------------------------------- | ---------------- | ---------------- | ----------------
sales and transfers of oil and gas produced net of production transportation and administrative costs | $ -5312 ( 5312 ) | $ -3754 ( 3754 ) | $ -2689 ( 2689 )
net changes in prices and production transportation and administrative costs related to future production | -1342 ( 1342 ) | 6648 | 771
extensions discoveries and improved recovery less related costs | 1290 | 700 | 1349
development costs incurred during the period | 1251 | 1030 | 609
changes in estimated future development costs | -527 ( 527 ) | -552 ( 552 ) | -628 ( 628 )
revisions of previous quantity estimates | 1319 | 820 | 948
net changes in purchases and sales of minerals in place | 30 | 4557 | 33
accretion of discount | 1882 | 1124 | 757
net change in income taxes | -660 ( 660 ) | -6694 ( 6694 ) | -627 ( 627 )
timing and other | -14 ( 14 ) | 307 | 97
net change for the year | -2083 ( 2083 ) | 4186 | 620
beginning of year | 10601 | 6415 | 5795
end of year | $ 8518 | $ 10601 | $ 6415
net change for the year from discontinued operations | $ -216 ( 216 ) | $ 162 | $ -152 ( 152 ) |
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dd4baaef8 | advance auto parts , inc .
schedule ii - valuation and qualifying accounts ( in thousands ) allowance for doubtful accounts receivable : balance at beginning of period charges to expenses deductions balance at end of period january 3 , 2015 $ 13295 $ 17182 $ ( 14325 ) ( 1 ) $ 16152 january 2 , 2016 16152 22067 ( 12461 ) ( 1 ) 25758 december 31 , 2016 25758 24597 ( 21191 ) ( 1 ) 29164 ( 1 ) accounts written off during the period .
these amounts did not impact the company 2019s statement of operations for any year presented .
note : other valuation and qualifying accounts have not been reported in this schedule because they are either not applicable or because the information has been included elsewhere in this report. .
allowance for doubtful accounts receivable: | balance atbeginningof period | charges toexpenses | deductions | | balance atend ofperiod
------------------------------------------- | ---------------------------- | ------------------ | ------------------ | -------- | ----------------------
january 3 2015 | $ 13295 | $ 17182 | $ -14325 ( 14325 ) | -1 ( 1 ) | $ 16152
january 2 2016 | 16152 | 22067 | -12461 ( 12461 ) | -1 ( 1 ) | 25758
december 31 2016 | 25758 | 24597 | -21191 ( 21191 ) | -1 ( 1 ) | 29164
advance auto parts , inc .
schedule ii - valuation and qualifying accounts ( in thousands ) allowance for doubtful accounts receivable : balance at beginning of period charges to expenses deductions balance at end of period january 3 , 2015 $ 13295 $ 17182 $ ( 14325 ) ( 1 ) $ 16152 january 2 , 2016 16152 22067 ( 12461 ) ( 1 ) 25758 december 31 , 2016 25758 24597 ( 21191 ) ( 1 ) 29164 ( 1 ) accounts written off during the period .
these amounts did not impact the company 2019s statement of operations for any year presented .
note : other valuation and qualifying accounts have not been reported in this schedule because they are either not applicable or because the information has been included elsewhere in this report. |
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dd4c63bf6 | notes to consolidated financial statements derivatives with credit-related contingent features certain of the firm 2019s derivatives have been transacted under bilateral agreements with counterparties who may require the firm to post collateral or terminate the transactions based on changes in the firm 2019s credit ratings .
the firm assesses the impact of these bilateral agreements by determining the collateral or termination payments that would occur assuming a downgrade by all rating agencies .
a downgrade by any one rating agency , depending on the agency 2019s relative ratings of the firm at the time of the downgrade , may have an impact which is comparable to the impact of a downgrade by all rating agencies .
the table below presents the aggregate fair value of net derivative liabilities under such agreements ( excluding application of collateral posted to reduce these liabilities ) , the related aggregate fair value of the assets posted as collateral , and the additional collateral or termination payments that could have been called at the reporting date by counterparties in the event of a one-notch and two-notch downgrade in the firm 2019s credit ratings. .
in millions | as of december 2013 | as of december 2012
----------------------------------------------------------------------- | ------------------- | -------------------
net derivative liabilities under bilateral agreements | $ 22176 | $ 27885
collateral posted | 18178 | 24296
additional collateral or termination payments for a one-notch downgrade | 911 | 1534
additional collateral or termination payments for a two-notch downgrade | 2989 | 2500
additional collateral or termination payments for a one-notch downgrade 911 1534 additional collateral or termination payments for a two-notch downgrade 2989 2500 credit derivatives the firm enters into a broad array of credit derivatives in locations around the world to facilitate client transactions and to manage the credit risk associated with market- making and investing and lending activities .
credit derivatives are actively managed based on the firm 2019s net risk position .
credit derivatives are individually negotiated contracts and can have various settlement and payment conventions .
credit events include failure to pay , bankruptcy , acceleration of indebtedness , restructuring , repudiation and dissolution of the reference entity .
credit default swaps .
single-name credit default swaps protect the buyer against the loss of principal on one or more bonds , loans or mortgages ( reference obligations ) in the event the issuer ( reference entity ) of the reference obligations suffers a credit event .
the buyer of protection pays an initial or periodic premium to the seller and receives protection for the period of the contract .
if there is no credit event , as defined in the contract , the seller of protection makes no payments to the buyer of protection .
however , if a credit event occurs , the seller of protection is required to make a payment to the buyer of protection , which is calculated in accordance with the terms of the contract .
credit indices , baskets and tranches .
credit derivatives may reference a basket of single-name credit default swaps or a broad-based index .
if a credit event occurs in one of the underlying reference obligations , the protection seller pays the protection buyer .
the payment is typically a pro-rata portion of the transaction 2019s total notional amount based on the underlying defaulted reference obligation .
in certain transactions , the credit risk of a basket or index is separated into various portions ( tranches ) , each having different levels of subordination .
the most junior tranches cover initial defaults and once losses exceed the notional amount of these junior tranches , any excess loss is covered by the next most senior tranche in the capital structure .
total return swaps .
a total return swap transfers the risks relating to economic performance of a reference obligation from the protection buyer to the protection seller .
typically , the protection buyer receives from the protection seller a floating rate of interest and protection against any reduction in fair value of the reference obligation , and in return the protection seller receives the cash flows associated with the reference obligation , plus any increase in the fair value of the reference obligation .
credit options .
in a credit option , the option writer assumes the obligation to purchase or sell a reference obligation at a specified price or credit spread .
the option purchaser buys the right , but does not assume the obligation , to sell the reference obligation to , or purchase it from , the option writer .
the payments on credit options depend either on a particular credit spread or the price of the reference obligation .
goldman sachs 2013 annual report 147 |
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dd4c54aca | the company expects annual amortization expense for these intangible assets to be: .
fiscal year | amortization expense
----------- | --------------------
2011 | $ 1343
g .
grant accounting certain of the company 2019s foreign subsidiaries have received various grants from governmental agencies .
these grants include capital , employment and research and development grants .
capital grants for the acquisition of property and equipment are netted against the related capital expenditures and amortized as a credit to depreciation expense over the useful life of the related asset .
employment grants , which relate to employee hiring and training , and research and development grants are recognized in earnings in the period in which the related expenditures are incurred by the company .
h .
translation of foreign currencies the functional currency for the company 2019s foreign sales and research and development operations is the applicable local currency .
gains and losses resulting from translation of these foreign currencies into u.s .
dollars are recorded in accumulated other comprehensive ( loss ) income .
transaction gains and losses and remeasurement of foreign currency denominated assets and liabilities are included in income currently , including those at the company 2019s principal foreign manufacturing operations where the functional currency is the u.s .
dollar .
foreign currency transaction gains or losses included in other expenses , net , were not material in fiscal 2010 , 2009 or 2008 .
i .
derivative instruments and hedging agreements foreign exchange exposure management 2014 the company enters into forward foreign currency exchange contracts to offset certain operational and balance sheet exposures from the impact of changes in foreign currency exchange rates .
such exposures result from the portion of the company 2019s operations , assets and liabilities that are denominated in currencies other than the u.s .
dollar , primarily the euro ; other exposures include the philippine peso and the british pound .
these foreign currency exchange contracts are entered into to support transactions made in the normal course of business , and accordingly , are not speculative in nature .
the contracts are for periods consistent with the terms of the underlying transactions , generally one year or less .
hedges related to anticipated transactions are designated and documented at the inception of the respective hedges as cash flow hedges and are evaluated for effectiveness monthly .
derivative instruments are employed to eliminate or minimize certain foreign currency exposures that can be confidently identified and quantified .
as the terms of the contract and the underlying transaction are matched at inception , forward contract effectiveness is calculated by comparing the change in fair value of the contract to the change in the forward value of the anticipated transaction , with the effective portion of the gain or loss on the derivative instrument reported as a component of accumulated other comprehensive ( loss ) income ( oci ) in shareholders 2019 equity and reclassified into earnings in the same period during which the hedged transaction affects earnings .
any residual change in fair value of the instruments , or ineffectiveness , is recognized immediately in other ( income ) expense .
additionally , the company enters into forward foreign currency contracts that economically hedge the gains and losses generated by the remeasurement of certain recorded assets and liabilities in a non-functional currency .
changes in the fair value of these undesignated hedges are recognized in other ( income ) expense immediately as an offset to the changes in the fair value of the asset or liability being hedged .
as of october 30 , 2010 and october 31 , 2009 , the total notional amount of these undesignated hedges was $ 42.1 million and $ 38 million , respectively .
the fair value of these hedging instruments in the company 2019s condensed consolidated balance sheets as of october 30 , 2010 and october 31 , 2009 was immaterial .
interest rate exposure management 2014 on june 30 , 2009 , the company entered into interest rate swap transactions related to its outstanding 5% ( 5 % ) senior unsecured notes where the company swapped the notional amount of its $ 375 million of fixed rate debt at 5.0% ( 5.0 % ) into floating interest rate debt through july 1 , 2014 .
under the terms of the swaps , the company will ( i ) receive on the $ 375 million notional amount a 5.0% ( 5.0 % ) annual interest payment that is analog devices , inc .
notes to consolidated financial statements 2014 ( continued ) |
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dd4b9a63e | regions .
principal cost drivers include manufacturing efficiency , raw material and energy costs and freight costs .
printing papers net sales for 2014 decreased 8% ( 8 % ) to $ 5.7 billion compared with $ 6.2 billion in 2013 and 8% ( 8 % ) compared with $ 6.2 billion in 2012 .
operating profits in 2014 were 106% ( 106 % ) lower than in 2013 and 103% ( 103 % ) lower than in 2012 .
excluding facility closure costs , impairment costs and other special items , operating profits in 2014 were 7% ( 7 % ) higher than in 2013 and 8% ( 8 % ) lower than in 2012 .
benefits from higher average sales price realizations and a favorable mix ( $ 178 million ) , lower planned maintenance downtime costs ( $ 26 million ) , the absence of a provision for bad debt related to a large envelope customer that was booked in 2013 ( $ 28 million ) , and lower foreign exchange and other costs ( $ 25 million ) were offset by lower sales volumes ( $ 82 million ) , higher operating costs ( $ 49 million ) , higher input costs ( $ 47 million ) , and costs associated with the closure of our courtland , alabama mill ( $ 41 million ) .
in addition , operating profits in 2014 include special items costs of $ 554 million associated with the closure of our courtland , alabama mill .
during 2013 , the company accelerated depreciation for certain courtland assets , and evaluated certain other assets for possible alternative uses by one of our other businesses .
the net book value of these assets at december 31 , 2013 was approximately $ 470 million .
in the first quarter of 2014 , we completed our evaluation and concluded that there were no alternative uses for these assets .
we recognized approximately $ 464 million of accelerated depreciation related to these assets in 2014 .
operating profits in 2014 also include a charge of $ 32 million associated with a foreign tax amnesty program , and a gain of $ 20 million for the resolution of a legal contingency in india , while operating profits in 2013 included costs of $ 118 million associated with the announced closure of our courtland , alabama mill and a $ 123 million impairment charge associated with goodwill and a trade name intangible asset in our india papers business .
printing papers .
in millions | 2014 | 2013 | 2012
------------------------- | ---------- | ------ | ------
sales | $ 5720 | $ 6205 | $ 6230
operating profit ( loss ) | -16 ( 16 ) | 271 | 599
north american printing papers net sales were $ 2.1 billion in 2014 , $ 2.6 billion in 2013 and $ 2.7 billion in 2012 .
operating profits in 2014 were a loss of $ 398 million ( a gain of $ 156 million excluding costs associated with the shutdown of our courtland , alabama mill ) compared with gains of $ 36 million ( $ 154 million excluding costs associated with the courtland mill shutdown ) in 2013 and $ 331 million in 2012 .
sales volumes in 2014 decreased compared with 2013 due to lower market demand for uncoated freesheet paper and the closure our courtland mill .
average sales price realizations were higher , reflecting sales price increases in both domestic and export markets .
higher input costs for wood were offset by lower costs for chemicals , however freight costs were higher .
planned maintenance downtime costs were $ 14 million lower in 2014 .
operating profits in 2014 were negatively impacted by costs associated with the shutdown of our courtland , alabama mill but benefited from the absence of a provision for bad debt related to a large envelope customer that was recorded in 2013 .
entering the first quarter of 2015 , sales volumes are expected to be stable compared with the fourth quarter of 2014 .
average sales margins should improve reflecting a more favorable mix although average sales price realizations are expected to be flat .
input costs are expected to be stable .
planned maintenance downtime costs are expected to be about $ 16 million lower with an outage scheduled in the 2015 first quarter at our georgetown mill compared with outages at our eastover and riverdale mills in the 2014 fourth quarter .
brazilian papers net sales for 2014 were $ 1.1 billion compared with $ 1.1 billion in 2013 and $ 1.1 billion in 2012 .
operating profits for 2014 were $ 177 million ( $ 209 million excluding costs associated with a tax amnesty program ) compared with $ 210 million in 2013 and $ 163 million in 2012 .
sales volumes in 2014 were about flat compared with 2013 .
average sales price realizations improved for domestic uncoated freesheet paper due to the realization of price increases implemented in the second half of 2013 and in 2014 .
margins were favorably affected by an increased proportion of sales to the higher-margin domestic market .
raw material costs increased for wood and chemicals .
operating costs were higher than in 2013 and planned maintenance downtime costs were flat .
looking ahead to 2015 , sales volumes in the first quarter are expected to decrease due to seasonally weaker customer demand for uncoated freesheet paper .
average sales price improvements are expected to reflect the partial realization of announced sales price increases in the brazilian domestic market for uncoated freesheet paper .
input costs are expected to be flat .
planned maintenance outage costs should be $ 5 million lower with an outage scheduled at the luiz antonio mill in the first quarter .
european papers net sales in 2014 were $ 1.5 billion compared with $ 1.5 billion in 2013 and $ 1.4 billion in 2012 .
operating profits in 2014 were $ 140 million compared with $ 167 million in 2013 and $ 179 million in compared with 2013 , sales volumes for uncoated freesheet paper in 2014 were slightly higher in both |
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dd4b892a8 | foreign currency exchange rate risk many of our non-u.s .
companies maintain both assets and liabilities in local currencies .
therefore , foreign exchange rate risk is generally limited to net assets denominated in those foreign currencies .
foreign exchange rate risk is reviewed as part of our risk management process .
locally required capital levels are invested in home currencies in order to satisfy regulatory require- ments and to support local insurance operations regardless of currency fluctuations .
the principal currencies creating foreign exchange risk for us are the british pound sterling , the euro , and the canadian dollar .
the following table provides more information on our exposure to foreign exchange rate risk at december 31 , 2008 and 2007. .
( in millions of u.s . dollars ) | 2008 | 2007
------------------------------------------------------------------------------------- | -------------- | --------------
fair value of net assets denominated in foreign currencies | $ 1127 | $ 1651
percentage of fair value of total net assets | 7.8% ( 7.8 % ) | 9.9% ( 9.9 % )
pre-tax impact on equity of hypothetical 10 percent strengthening of the u.s . dollar | $ 84 | $ 150
reinsurance of gmdb and gmib guarantees our net income is directly impacted by changes in the reserves calculated in connection with the reinsurance of variable annuity guarantees , primarily gmdb and gmib .
these reserves are calculated in accordance with sop 03-1 ( sop reserves ) and changes in these reserves are reflected as life and annuity benefit expense , which is included in life underwriting income .
in addition , our net income is directly impacted by the change in the fair value of the gmib liability ( fvl ) , which is classified as a derivative according to fas 133 .
the fair value liability established for a gmib reinsurance contract represents the differ- ence between the fair value of the contract and the sop 03-1 reserves .
changes in the fair value of the gmib liability , net of associated changes in the calculated sop 03-1 reserve , are reflected as realized gains or losses .
ace views our variable annuity reinsurance business as having a similar risk profile to that of catastrophe reinsurance , with the probability of long-term economic loss relatively small at the time of pricing .
adverse changes in market factors and policyholder behavior will have an impact on both life underwriting income and net income .
when evaluating these risks , we expect to be compensated for taking both the risk of a cumulative long-term economic net loss , as well as the short-term accounting variations caused by these market movements .
therefore , we evaluate this business in terms of its long-term eco- nomic risk and reward .
the ultimate risk to the variable annuity guaranty reinsurance business is a long-term underperformance of investment returns , which can be exacerbated by a long-term reduction in interest rates .
following a market downturn , continued market underperformance over a period of five to seven years would eventually result in a higher level of paid claims as policyholders accessed their guarantees through death or annuitization .
however , if market conditions improved following a downturn , sop 03-1 reserves and fair value liability would fall reflecting a decreased likelihood of future claims , which would result in an increase in both life underwriting income and net income .
as of december 31 , 2008 , management established the sop 03-1 reserve based on the benefit ratio calculated using actual market values at december 31 , 2008 .
management exercises judgment in determining the extent to which short-term market movements impact the sop 03-1 reserve .
the sop 03-1 reserve is based on the calculation of a long-term benefit ratio ( or loss ratio ) for the variable annuity guarantee reinsurance .
despite the long-term nature of the risk the benefit ratio calculation is impacted by short-term market movements that may be judged by management to be temporary or transient .
management will , in keeping with the language in sop 03-1 , regularly examine both quantitative and qualitative analysis and management will determine if , in its judgment , the change in the calculated benefit ratio is of sufficient magnitude and has persisted for a sufficient duration to warrant a change in the benefit ratio used to establish the sop 03-1 reserve .
this has no impact on either premium received or claims paid nor does it impact the long-term profit or loss of the variable annuity guaran- tee reinsurance .
the sop 03-1 reserve and fair value liability calculations are directly affected by market factors , including equity levels , interest rate levels , credit risk and implied volatilities , as well as policyholder behaviors , such as annuitization and lapse rates .
the table below shows the sensitivity , as of december 31 , 2008 , of the sop 03-1 reserves and fair value liability associated with the variable annuity guarantee reinsurance portfolio .
in addition , the tables below show the sensitivity of the fair value of specific derivative instruments held ( hedge value ) , which includes instruments purchased in january 2009 , to partially offset the risk in the variable annuity guarantee reinsurance portfolio .
although these derivatives do not receive hedge accounting treatment , some portion of the change in value may be used to offset changes in the sop 03-1 reserve. |
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dd4bd2f20 | table of contents cdw corporation and subsidiaries method or straight-line method , as applicable .
the company classifies deferred financing costs as a direct deduction from the carrying value of the long-term debt liability on the consolidated balance sheets , except for deferred financing costs associated with revolving credit facilities which are presented as an asset , within other assets on the consolidated balance sheets .
derivative instruments the company has interest rate cap agreements for the purpose of hedging its exposure to fluctuations in interest rates .
the interest rate cap agreements are designated as cash flow hedges of interest rate risk and recorded at fair value in other assets on the consolidated balance sheets .
the gain or loss on the derivative instruments is reported as a component of accumulated other comprehensive loss until reclassified to interest expense in the same period the hedge transaction affects earnings .
fair value measurements fair value is defined under gaap as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date .
a fair value hierarchy has been established for valuation inputs to prioritize the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market .
each fair value measurement is reported in one of the three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety .
these levels are : level 1 2013 observable inputs such as quoted prices for identical instruments traded in active markets .
level 2 2013 inputs are based on quoted prices for similar instruments in active markets , quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities .
level 3 2013 inputs are generally unobservable and typically reflect management 2019s estimates of assumptions that market participants would use in pricing the asset or liability .
the fair values are therefore determined using model-based techniques that include option pricing models , discounted cash flow models and similar techniques .
accumulated other comprehensive loss the components of accumulated other comprehensive loss included in stockholders 2019 equity are as follows: .
( in millions ) | years ended december 31 , 2017 | years ended december 31 , 2016 | years ended december 31 , 2015
------------------------------------- | ------------------------------ | ------------------------------ | ------------------------------
foreign currency translation | $ -96.1 ( 96.1 ) | $ -139.6 ( 139.6 ) | $ -61.1 ( 61.1 )
unrealized gain from hedge accounting | 0.2 | 2014 | 2014
accumulated other comprehensive loss | $ -95.9 ( 95.9 ) | $ -139.6 ( 139.6 ) | $ -61.1 ( 61.1 )
revenue recognition the company is a primary distribution channel for a large group of vendors and suppliers , including original equipment manufacturers ( 201coems 201d ) , software publishers , wholesale distributors and cloud providers .
the company records revenue from sales transactions when title and risk of loss are passed to the customer , there is persuasive evidence of an arrangement for sale , delivery has occurred and/or services have been rendered , the sales price is fixed or determinable , and collectability is reasonably assured .
the company 2019s shipping terms typically specify f.o.b .
destination , at which time title and risk of loss have passed to the customer .
revenues from the sales of hardware products and software licenses are generally recognized on a gross basis with the selling price to the customer recorded as sales and the acquisition cost of the product recorded as cost of sales .
these items can be delivered to customers in a variety of ways , including ( i ) as physical product shipped from the company 2019s warehouse , ( ii ) via drop-shipment by the vendor or supplier , or ( iii ) via electronic delivery for software licenses .
at the time of sale , the company records an estimate for sales returns and allowances based on historical experience .
the company 2019s vendor partners warrant most of the products the company sells .
the company leverages drop-shipment arrangements with many of its vendors and suppliers to deliver products to its customers without having to physically hold the inventory at its warehouses , thereby increasing efficiency and reducing |
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dd4c1e9ca | capital resources and liquidity capital resources overview capital has historically been generated by earnings from citi 2019s operating businesses .
citi may also augment its capital through issuances of common stock , convertible preferred stock , preferred stock , equity issued through awards under employee benefit plans , and , in the case of regulatory capital , through the issuance of subordinated debt underlying trust preferred securities .
in addition , the impact of future events on citi 2019s business results , such as corporate and asset dispositions , as well as changes in accounting standards , also affect citi 2019s capital levels .
generally , capital is used primarily to support assets in citi 2019s businesses and to absorb market , credit , or operational losses .
while capital may be used for other purposes , such as to pay dividends or repurchase common stock , citi 2019s ability to utilize its capital for these purposes is currently restricted due to its agreements with the u.s .
government , generally for so long as the u.s .
government continues to hold citi 2019s common stock or trust preferred securities .
see also 201csupervision and regulation 201d below .
citigroup 2019s capital management framework is designed to ensure that citigroup and its principal subsidiaries maintain sufficient capital consistent with citi 2019s risk profile and all applicable regulatory standards and guidelines , as well as external rating agency considerations .
the capital management process is centrally overseen by senior management and is reviewed at the consolidated , legal entity , and country level .
senior management is responsible for the capital management process mainly through citigroup 2019s finance and asset and liability committee ( finalco ) , with oversight from the risk management and finance committee of citigroup 2019s board of directors .
the finalco is composed of the senior-most management of citigroup for the purpose of engaging management in decision-making and related discussions on capital and liquidity matters .
among other things , finalco 2019s responsibilities include : determining the financial structure of citigroup and its principal subsidiaries ; ensuring that citigroup and its regulated entities are adequately capitalized in consultation with its regulators ; determining appropriate asset levels and return hurdles for citigroup and individual businesses ; reviewing the funding and capital markets plan for citigroup ; and monitoring interest rate risk , corporate and bank liquidity , and the impact of currency translation on non-u.s .
earnings and capital .
capital ratios citigroup is subject to the risk-based capital guidelines issued by the federal reserve board .
historically , capital adequacy has been measured , in part , based on two risk-based capital ratios , the tier 1 capital and total capital ( tier 1 capital + tier 2 capital ) ratios .
tier 1 capital consists of the sum of 201ccore capital elements , 201d such as qualifying common stockholders 2019 equity , as adjusted , qualifying noncontrolling interests , and qualifying mandatorily redeemable securities of subsidiary trusts , principally reduced by goodwill , other disallowed intangible assets , and disallowed deferred tax assets .
total capital also includes 201csupplementary 201d tier 2 capital elements , such as qualifying subordinated debt and a limited portion of the allowance for credit losses .
both measures of capital adequacy are stated as a percentage of risk-weighted assets .
further , in conjunction with the conduct of the 2009 supervisory capital assessment program ( scap ) , u.s .
banking regulators developed a new measure of capital termed 201ctier 1 common , 201d which has been defined as tier 1 capital less non-common elements , including qualifying perpetual preferred stock , qualifying noncontrolling interests , and qualifying mandatorily redeemable securities of subsidiary trusts .
citigroup 2019s risk-weighted assets are principally derived from application of the risk-based capital guidelines related to the measurement of credit risk .
pursuant to these guidelines , on-balance-sheet assets and the credit equivalent amount of certain off-balance-sheet exposures ( such as financial guarantees , unfunded lending commitments , letters of credit , and derivatives ) are assigned to one of several prescribed risk-weight categories based upon the perceived credit risk associated with the obligor , or if relevant , the guarantor , the nature of the collateral , or external credit ratings .
risk-weighted assets also incorporate a measure for market risk on covered trading account positions and all foreign exchange and commodity positions whether or not carried in the trading account .
excluded from risk-weighted assets are any assets , such as goodwill and deferred tax assets , to the extent required to be deducted from regulatory capital .
see 201ccomponents of capital under regulatory guidelines 201d below .
citigroup is also subject to a leverage ratio requirement , a non-risk-based measure of capital adequacy , which is defined as tier 1 capital as a percentage of quarterly adjusted average total assets .
to be 201cwell capitalized 201d under federal bank regulatory agency definitions , a bank holding company must have a tier 1 capital ratio of at least 6% ( 6 % ) , a total capital ratio of at least 10% ( 10 % ) , and a leverage ratio of at least 3% ( 3 % ) , and not be subject to a federal reserve board directive to maintain higher capital levels .
the following table sets forth citigroup 2019s regulatory capital ratios as of december 31 , 2009 and december 31 , 2008 .
citigroup regulatory capital ratios .
at year end | 2009 | 2008
--------------------------------------------------- | ---------------- | ----------------
tier 1 common | 9.60% ( 9.60 % ) | 2.30% ( 2.30 % )
tier 1 capital | 11.67 | 11.92
total capital ( tier 1 capital and tier 2 capital ) | 15.25 | 15.70
leverage | 6.89 | 6.08
as noted in the table above , citigroup was 201cwell capitalized 201d under the federal bank regulatory agency definitions at year end for both 2009 and 2008. |
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dd4c11964 | jpmorgan chase & co./2018 form 10-k 117 lending-related commitments the firm uses lending-related financial instruments , such as commitments ( including revolving credit facilities ) and guarantees , to address the financing needs of its clients .
the contractual amounts of these financial instruments represent the maximum possible credit risk should the clients draw down on these commitments or the firm fulfill its obligations under these guarantees , and the clients subsequently fail to perform according to the terms of these contracts .
most of these commitments and guarantees are refinanced , extended , cancelled , or expire without being drawn upon or a default occurring .
in the firm 2019s view , the total contractual amount of these wholesale lending-related commitments is not representative of the firm 2019s expected future credit exposure or funding requirements .
for further information on wholesale lending-related commitments , refer to note 27 .
clearing services the firm provides clearing services for clients entering into certain securities and derivative contracts .
through the provision of these services the firm is exposed to the risk of non-performance by its clients and may be required to share in losses incurred by ccps .
where possible , the firm seeks to mitigate its credit risk to its clients through the collection of adequate margin at inception and throughout the life of the transactions and can also cease provision of clearing services if clients do not adhere to their obligations under the clearing agreement .
for further discussion of clearing services , refer to note 27 .
derivative contracts derivatives enable clients and counterparties to manage risks including credit risk and risks arising from fluctuations in interest rates , foreign exchange , equities , and commodities .
the firm makes markets in derivatives in order to meet these needs and uses derivatives to manage certain risks associated with net open risk positions from its market-making activities , including the counterparty credit risk arising from derivative receivables .
the firm also uses derivative instruments to manage its own credit and other market risk exposure .
the nature of the counterparty and the settlement mechanism of the derivative affect the credit risk to which the firm is exposed .
for otc derivatives the firm is exposed to the credit risk of the derivative counterparty .
for exchange-traded derivatives ( 201cetd 201d ) , such as futures and options , and 201ccleared 201d over-the-counter ( 201cotc-cleared 201d ) derivatives , the firm is generally exposed to the credit risk of the relevant ccp .
where possible , the firm seeks to mitigate its credit risk exposures arising from derivative contracts through the use of legally enforceable master netting arrangements and collateral agreements .
for a further discussion of derivative contracts , counterparties and settlement types , refer to note 5 .
the following table summarizes the net derivative receivables for the periods presented .
derivative receivables .
december 31 ( in millions ) | 2018 | 2017
------------------------------------------------------------------------------------- | ---------------- | ----------------
total net of cash collateral | $ 54213 | $ 56523
liquid securities and other cash collateral held against derivative receivables ( a ) | -15322 ( 15322 ) | -16108 ( 16108 )
total net of all collateral | $ 38891 | $ 40415
( a ) includes collateral related to derivative instruments where appropriate legal opinions have not been either sought or obtained with respect to master netting agreements .
the fair value of derivative receivables reported on the consolidated balance sheets were $ 54.2 billion and $ 56.5 billion at december 31 , 2018 and 2017 , respectively .
derivative receivables represent the fair value of the derivative contracts after giving effect to legally enforceable master netting agreements and cash collateral held by the firm .
however , in management 2019s view , the appropriate measure of current credit risk should also take into consideration additional liquid securities ( primarily u.s .
government and agency securities and other group of seven nations ( 201cg7 201d ) government securities ) and other cash collateral held by the firm aggregating $ 15.3 billion and $ 16.1 billion at december 31 , 2018 and 2017 , respectively , that may be used as security when the fair value of the client 2019s exposure is in the firm 2019s favor .
in addition to the collateral described in the preceding paragraph , the firm also holds additional collateral ( primarily cash , g7 government securities , other liquid government-agency and guaranteed securities , and corporate debt and equity securities ) delivered by clients at the initiation of transactions , as well as collateral related to contracts that have a non-daily call frequency and collateral that the firm has agreed to return but has not yet settled as of the reporting date .
although this collateral does not reduce the balances and is not included in the table above , it is available as security against potential exposure that could arise should the fair value of the client 2019s derivative contracts move in the firm 2019s favor .
the derivative receivables fair value , net of all collateral , also does not include other credit enhancements , such as letters of credit .
for additional information on the firm 2019s use of collateral agreements , refer to note 5 .
while useful as a current view of credit exposure , the net fair value of the derivative receivables does not capture the potential future variability of that credit exposure .
to capture the potential future variability of credit exposure , the firm calculates , on a client-by-client basis , three measures of potential derivatives-related credit loss : peak , derivative risk equivalent ( 201cdre 201d ) , and average exposure ( 201cavg 201d ) .
these measures all incorporate netting and collateral benefits , where applicable .
peak represents a conservative measure of potential exposure to a counterparty calculated in a manner that is broadly equivalent to a 97.5% ( 97.5 % ) confidence level over the life of the transaction .
peak is the primary measure used by the firm for setting of credit limits for derivative contracts , senior management reporting and derivatives exposure management .
dre exposure is a measure that expresses the risk of derivative exposure on a basis intended to be |
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dd497a67e | inventory on hand , as well as our future purchase commitments with our suppliers , considering multiple factors , including demand forecasts , product life cycle , current sales levels , pricing strategy and cost trends .
if our review indicates that inventories of raw materials , components or finished products have become obsolete or are in excess of anticipated demand or that inventory cost exceeds net realizable value , we may be required to make adjustments that will impact the results of operations .
goodwill and non-amortizable intangible assets valuation - we test goodwill and non-amortizable intangible assets for impairment annually or more frequently if events occur that would warrant such review .
while the company has the option to perform a qualitative assessment for both goodwill and non-amortizable intangible assets to determine if it is more likely than not that an impairment exists , the company elects to perform the quantitative assessment for our annual impairment analysis .
the impairment analysis involves comparing the fair value of each reporting unit or non-amortizable intangible asset to the carrying value .
if the carrying value exceeds the fair value , goodwill or a non-amortizable intangible asset is considered impaired .
to determine the fair value of goodwill , we primarily use a discounted cash flow model , supported by the market approach using earnings multiples of comparable global and local companies within the tobacco industry .
at december 31 , 2018 , the carrying value of our goodwill was $ 7.2 billion , which is related to ten reporting units , each of which consists of a group of markets with similar economic characteristics .
the estimated fair value of each of our ten reporting units exceeded the carrying value as of december 31 , 2018 .
to determine the fair value of non-amortizable intangible assets , we primarily use a discounted cash flow model applying the relief-from-royalty method .
we concluded that the fair value of our non- amortizable intangible assets exceeded the carrying value .
these discounted cash flow models include management assumptions relevant for forecasting operating cash flows , which are subject to changes in business conditions , such as volumes and prices , costs to produce , discount rates and estimated capital needs .
management considers historical experience and all available information at the time the fair values are estimated , and we believe these assumptions are consistent with the assumptions a hypothetical marketplace participant would use .
since the march 28 , 2008 , spin-off from altria group , inc. , we have not recorded a charge to earnings for an impairment of goodwill or non-amortizable intangible assets .
marketing costs - we incur certain costs to support our products through programs that include advertising , marketing , consumer engagement and trade promotions .
the costs of our advertising and marketing programs are expensed in accordance with u.s .
gaap .
recognition of the cost related to our consumer engagement and trade promotion programs contain uncertainties due to the judgment required in estimating the potential performance and compliance for each program .
for volume-based incentives provided to customers , management continually assesses and estimates , by customer , the likelihood of the customer's achieving the specified targets , and records the reduction of revenue as the sales are made .
for other trade promotions , management relies on estimated utilization rates that have been developed from historical experience .
changes in the assumptions used in estimating the cost of any individual marketing program would not result in a material change in our financial position , results of operations or operating cash flows .
employee benefit plans - as discussed in item 8 , note 13 .
benefit plans to our consolidated financial statements , we provide a range of benefits to our employees and retired employees , including pensions , postretirement health care and postemployment benefits ( primarily severance ) .
we record annual amounts relating to these plans based on calculations specified by u.s .
gaap .
these calculations include various actuarial assumptions , such as discount rates , assumed rates of return on plan assets , compensation increases , mortality , turnover rates and health care cost trend rates .
we review actuarial assumptions on an annual basis and make modifications to the assumptions based on current rates and trends when it is deemed appropriate to do so .
as permitted by u.s .
gaap , any effect of the modifications is generally amortized over future periods .
we believe that the assumptions utilized in calculating our obligations under these plans are reasonable based upon our historical experience and advice from our actuaries .
weighted-average discount rate assumptions for pension and postretirement plan obligations at december 31 , 2018 and 2017 are as follows: .
| 2018 | 2017
-------------------- | ---------------- | ----------------
pension plans | 1.61% ( 1.61 % ) | 1.51% ( 1.51 % )
postretirement plans | 3.97% ( 3.97 % ) | 3.79% ( 3.79 % )
we anticipate that assumption changes will increase 2019 pre-tax pension and postretirement expense to approximately $ 205 million as compared with approximately $ 160 million in 2018 , excluding amounts related to employee severance and early retirement programs .
the anticipated increase is primarily due to higher amortization out of other comprehensive earnings for unrecognized actuarial gains/ losses of $ 14 million , coupled with lower return on assets of $ 16 million , higher interest and service cost of $ 12 million and $ 4 million respectively , partially offset by other movements of $ 1 million .
weighted-average expected rate of return and discount rate assumptions have a significant effect on the amount of expense reported for the employee benefit plans .
a fifty-basis-point decrease in our discount rate would increase our 2019 pension and postretirement expense by approximately $ 50 million , and a fifty-basis-point increase in our discount rate would decrease our 2019 pension and postretirement |
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dd497bd08 | item 1b .
unresolved staff comments .
item 2 .
properties .
our corporate co-headquarters are located in pittsburgh , pennsylvania and chicago , illinois .
our co-headquarters are leased and house our executive offices , certain u.s .
business units , and our administrative , finance , and human resource functions .
we maintain additional owned and leased offices throughout the regions in which we operate .
we manufacture our products in our network of manufacturing and processing facilities located throughout the world .
as of december 31 , 2016 , we operated 87 manufacturing and processing facilities .
we own 83 and lease four of these facilities .
our manufacturing and processing facilities count by segment as of december 31 , 2016 was: .
| owned | leased
------------- | ----- | ------
united states | 43 | 2
canada | 3 | 2014
europe | 11 | 2014
rest of world | 26 | 2
we maintain all of our manufacturing and processing facilities in good condition and believe they are suitable and are adequate for our present needs .
we also enter into co-manufacturing arrangements with third parties if we determine it is advantageous to outsource the production of any of our products .
in the fourth quarter of 2016 , we reorganized our segment structure to move our russia business from the rest of world segment to the europe segment .
we have reflected this change in the table above .
see note 18 , segment reporting , to the consolidated financial statements for additional information .
several of our current manufacturing and processing facilities are scheduled to be closed within the next year .
see note 3 , integration and restructuring expenses , to the consolidated financial statements for additional information .
item 3 .
legal proceedings .
we are routinely involved in legal proceedings , claims , and governmental inquiries , inspections or investigations ( 201clegal matters 201d ) arising in the ordinary course of our business .
on april 1 , 2015 , the commodity futures trading commission ( 201ccftc 201d ) filed a formal complaint against mondel 0113z international ( formerly known as kraft foods inc. ) and kraft in the u.s .
district court for the northern district of illinois , eastern division , related to activities involving the trading of december 2011 wheat futures contracts .
the complaint alleges that mondel 0113z international and kraft ( 1 ) manipulated or attempted to manipulate the wheat markets during the fall of 2011 , ( 2 ) violated position limit levels for wheat futures , and ( 3 ) engaged in non-competitive trades by trading both sides of exchange-for-physical chicago board of trade wheat contracts .
as previously disclosed by kraft , these activities arose prior to the october 1 , 2012 spin-off of kraft by mondel 0113z international to its shareholders and involve the business now owned and operated by mondel 0113z international or its affiliates .
the separation and distribution agreement between kraft and mondel 0113z international , dated as of september 27 , 2012 , governs the allocation of liabilities between mondel 0113z international and kraft and , accordingly , mondel 0113z international will predominantly bear the costs of this matter and any monetary penalties or other payments that the cftc may impose .
we do not expect this matter to have a material adverse effect on our financial condition , results of operations , or business .
while we cannot predict with certainty the results of legal matters in which we are currently involved or may in the future be involved , we do not expect that the ultimate costs to resolve any of the legal matters that are currently pending will have a material adverse effect on our financial condition or results of operations .
item 4 .
mine safety disclosures .
not applicable. |
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dd4b9ff3a | hr solutions .
years ended december 31, | 2010 | 2009 | 2008
------------------------ | ---------------- | ---------------- | ----------------
revenue | $ 2111 | $ 1267 | $ 1356
operating income | 234 | 203 | 208
operating margin | 11.1% ( 11.1 % ) | 16.0% ( 16.0 % ) | 15.3% ( 15.3 % )
in october 2010 , we completed the acquisition of hewitt , one of the world 2019s leading human resource consulting and outsourcing companies .
hewitt operates globally together with aon 2019s existing consulting and outsourcing operations under the newly created aon hewitt brand .
hewitt 2019s operating results are included in aon 2019s results of operations beginning october 1 , 2010 .
our hr solutions segment generated approximately 25% ( 25 % ) of our consolidated total revenues in 2010 and provides a broad range of human capital services , as follows : consulting services : 2022 health and benefits advises clients about how to structure , fund , and administer employee benefit programs that attract , retain , and motivate employees .
benefits consulting includes health and welfare , executive benefits , workforce strategies and productivity , absence management , benefits administration , data-driven health , compliance , employee commitment , investment advisory and elective benefits services .
2022 retirement specializes in global actuarial services , defined contribution consulting , investment consulting , tax and erisa consulting , and pension administration .
2022 compensation focuses on compensatory advisory/counsel including : compensation planning design , executive reward strategies , salary survey and benchmarking , market share studies and sales force effectiveness , with special expertise in the financial services and technology industries .
2022 strategic human capital delivers advice to complex global organizations on talent , change and organizational effectiveness issues , including talent strategy and acquisition , executive on-boarding , performance management , leadership assessment and development , communication strategy , workforce training and change management .
outsourcing services : 2022 benefits outsourcing applies our hr expertise primarily through defined benefit ( pension ) , defined contribution ( 401 ( k ) ) , and health and welfare administrative services .
our model replaces the resource-intensive processes once required to administer benefit plans with more efficient , effective , and less costly solutions .
2022 human resource business processing outsourcing ( 2018 2018hr bpo 2019 2019 ) provides market-leading solutions to manage employee data ; administer benefits , payroll and other human resources processes ; and record and manage talent , workforce and other core hr process transactions as well as other complementary services such as absence management , flexible spending , dependent audit and participant advocacy .
beginning in late 2008 , the disruption in the global credit markets and the deterioration of the financial markets created significant uncertainty in the marketplace .
weak economic conditions globally continued throughout 2010 .
the prolonged economic downturn is adversely impacting our clients 2019 financial condition and therefore the levels of business activities in the industries and geographies where we operate .
while we believe that the majority of our practices are well positioned to manage through this time , these challenges are reducing demand for some of our services and putting |
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dd4bc1c7a | pipeline transportation 2013 we own a system of pipelines through marathon pipe line llc ( 201cmpl 201d ) and ohio river pipe line llc ( 201corpl 201d ) , our wholly-owned subsidiaries .
our pipeline systems transport crude oil and refined products primarily in the midwest and gulf coast regions to our refineries , our terminals and other pipeline systems .
our mpl and orpl wholly-owned and undivided interest common carrier systems consist of 1737 miles of crude oil lines and 1825 miles of refined product lines comprising 32 systems located in 11 states .
the mpl common carrier pipeline network is one of the largest petroleum pipeline systems in the united states , based on total barrels delivered .
our common carrier pipeline systems are subject to state and federal energy regulatory commission regulations and guidelines , including published tariffs for the transportation of crude oil and refined products .
third parties generated 13 percent of the crude oil and refined product shipments on our mpl and orpl common carrier pipelines in 2009 .
our mpl and orpl common carrier pipelines transported the volumes shown in the following table for each of the last three years .
pipeline barrels handled ( thousands of barrels per day ) 2009 2008 2007 .
( thousands of barrels per day ) | 2009 | 2008 | 2007
-------------------------------- | ---- | ---- | ----
crude oil trunk lines | 1279 | 1405 | 1451
refined products trunk lines | 953 | 960 | 1049
total | 2232 | 2365 | 2500
we also own 196 miles of private crude oil pipelines and 850 miles of private refined products pipelines , and we lease 217 miles of common carrier refined product pipelines .
we have partial ownership interests in several pipeline companies that have approximately 780 miles of crude oil pipelines and 3600 miles of refined products pipelines , including about 970 miles operated by mpl .
in addition , mpl operates most of our private pipelines and 985 miles of crude oil and 160 miles of natural gas pipelines owned by our e&p segment .
our major refined product pipelines include the owned and operated cardinal products pipeline and the wabash pipeline .
the cardinal products pipeline delivers refined products from kenova , west virginia , to columbus , ohio .
the wabash pipeline system delivers product from robinson , illinois , to various terminals in the area of chicago , illinois .
other significant refined product pipelines owned and operated by mpl extend from : robinson , illinois , to louisville , kentucky ; garyville , louisiana , to zachary , louisiana ; and texas city , texas , to pasadena , texas .
in addition , as of december 31 , 2009 , we had interests in the following refined product pipelines : 2022 65 percent undivided ownership interest in the louisville-lexington system , a petroleum products pipeline system extending from louisville to lexington , kentucky ; 2022 60 percent interest in muskegon pipeline llc , which owns a refined products pipeline extending from griffith , indiana , to north muskegon , michigan ; 2022 50 percent interest in centennial pipeline llc , which owns a refined products system connecting the gulf coast region with the midwest market ; 2022 17 percent interest in explorer pipeline company , a refined products pipeline system extending from the gulf coast to the midwest ; and 2022 6 percent interest in wolverine pipe line company , a refined products pipeline system extending from chicago , illinois , to toledo , ohio .
our major owned and operated crude oil lines run from : patoka , illinois , to catlettsburg , kentucky ; patoka , illinois , to robinson , illinois ; patoka , illinois , to lima , ohio ; lima , ohio to canton , ohio ; samaria , michigan , to detroit , michigan ; and st .
james , louisiana , to garyville , louisiana .
as of december 31 , 2009 , we had interests in the following crude oil pipelines : 2022 51 percent interest in loop llc , the owner and operator of loop , which is the only u.s .
deepwater oil port , located 18 miles off the coast of louisiana , and a crude oil pipeline connecting the port facility to storage caverns and tanks at clovelly , louisiana ; 2022 59 percent interest in locap llc , which owns a crude oil pipeline connecting loop and the capline system; |
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dd4bce6be | n o t e s t o c o n s o l i d a t e d f i n a n c i a l s t a t e m e n t s ( continued ) ace limited and subsidiaries the following table shows changes in the company 2019s stock options for the years ended december 31 , 2008 , 2007 , and number of options weighted average exercise price .
| number of options | weightedaverageexercise price
------------------------------------ | -------------------- | -----------------------------
options outstanding december 31 2005 | 12643761 | $ 36.53
granted | 1505215 | $ 56.29
exercised | -1982560 ( 1982560 ) | $ 33.69
forfeited | -413895 ( 413895 ) | $ 39.71
options outstanding december 31 2006 | 11752521 | $ 39.43
granted | 1549091 | $ 56.17
exercised | -1830004 ( 1830004 ) | $ 35.73
forfeited | -200793 ( 200793 ) | $ 51.66
options outstanding december 31 2007 | 11270815 | $ 42.12
granted | 1612507 | $ 60.17
exercised | -2650733 ( 2650733 ) | $ 36.25
forfeited | -309026 ( 309026 ) | $ 54.31
options outstanding december 31 2008 | 9923563 | $ 46.24
the weighted-average remaining contractual term was 5.8 years for the stock options outstanding and 4.6 years for the stock options exercisable at december 31 , 2008 .
the total intrinsic value was approximately $ 66 million for stock options out- standing and $ 81 million for stock options exercisable at december 31 , 2008 .
the weighted-average fair value for the stock options granted for the year ended december 31 , 2008 was $ 17.60 .
the total intrinsic value for stock options exercised dur- ing the years ended december 31 , 2008 , 2007 , and 2006 , was approximately $ 54 million , $ 44 million , and $ 43 million , respectively .
the amount of cash received during the year ended december 31 , 2008 , from the exercise of stock options was $ 97 million .
restricted stock the company 2019s 2004 ltip also provides for grants of restricted stock .
the company generally grants restricted stock with a 4-year vesting period , based on a graded vesting schedule .
the restricted stock is granted at market close price on the date of grant .
included in the company 2019s share-based compensation expense in the year ended december 31 , 2008 , is a portion of the cost related to the unvested restricted stock granted in the years 2004 to 2008. |
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dd49719f2 | payments ( receipts ) ( in millions ) .
| payments ( receipts ) ( in millions )
------------------- | -------------------------------------
entergy arkansas | $ 2
entergy louisiana | $ 6
entergy mississippi | ( $ 4 )
entergy new orleans | ( $ 1 )
entergy texas | ( $ 3 )
in september 2016 the ferc accepted the february 2016 compliance filing subject to a further compliance filing made in november 2016 .
the further compliance filing was required as a result of an order issued in september 2016 ruling on the january 2016 rehearing requests filed by the lpsc , the apsc , and entergy .
in the order addressing the rehearing requests , the ferc granted the lpsc 2019s rehearing request and directed that interest be calculated on the payment/receipt amounts .
the ferc also granted the apsc 2019s and entergy 2019s rehearing request and ordered the removal of both securitized asset accumulated deferred income taxes and contra-securitization accumulated deferred income taxes from the calculation .
in november 2016 , entergy submitted its compliance filing in response to the ferc 2019s order on rehearing .
the compliance filing included a revised refund calculation of the true-up payments and receipts based on 2009 test year data and interest calculations .
the lpsc protested the interest calculations .
in november 2017 the ferc issued an order rejecting the november 2016 compliance filing .
the ferc determined that the payments detailed in the november 2016 compliance filing did not include adequate interest for the payments from entergy arkansas to entergy louisiana because it did not include interest on the principal portion of the payment that was made in february 2016 .
in december 2017 , entergy recalculated the interest pursuant to the november 2017 order .
as a result of the recalculations , entergy arkansas owed very minor payments to entergy louisiana , entergy mississippi , and entergy new orleans .
2011 rate filing based on calendar year 2010 production costs in may 2011 , entergy filed with the ferc the 2011 rates in accordance with the ferc 2019s orders in the system agreement proceeding . a0 a0several parties intervened in the proceeding at the ferc , including the lpsc , which also filed a protest . a0 a0in july a02011 the ferc a0accepted entergy 2019s proposed rates for filing , a0effective june a01 , a02011 , a0subject to refund .
after an abeyance of the proceeding schedule , in december 2014 the ferc consolidated the 2011 rate filing with the 2012 , 2013 , and 2014 rate filings for settlement and hearing procedures .
see discussion below regarding the consolidated settlement and hearing procedures in connection with this proceeding .
2012 rate filing based on calendar year 2011 production costs in may 2012 , entergy filed with the ferc the 2012 rates in accordance with the ferc 2019s orders in the system agreement proceeding . a0 a0several parties intervened in the proceeding at the ferc , including the lpsc , which also filed a protest . a0 a0in august 2012 the ferc a0accepted entergy 2019s proposed rates for filing , a0effective june a02012 , a0subject to refund .
after an abeyance of the proceeding schedule , in december 2014 the ferc consolidated the 2012 rate filing with the 2011 , 2013 , and 2014 rate filings for settlement and hearing procedures .
see discussion below regarding the consolidated settlement and hearing procedures in connection with this proceeding .
2013 rate filing based on calendar year 2012 production costs in may 2013 , entergy filed with the ferc the 2013 rates in accordance with the ferc 2019s orders in the system agreement proceeding .
several parties intervened in the proceeding at the ferc , including the lpsc , which also filed a protest .
the city council intervened and filed comments related to including the outcome of a related ferc proceeding in the 2013 cost equalization calculation .
in august 2013 the ferc issued an order accepting the 2013 rates , effective june 1 , 2013 , subject to refund .
after an abeyance of the proceeding schedule , in december 2014 the ferc consolidated the 2013 rate filing with the 2011 , 2012 , and 2014 rate filings for settlement and hearing procedures .
entergy corporation and subsidiaries notes to financial statements |
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dd4c04b4c | table of contents the following discussion of nonoperating income and expense excludes the results of the merger in order to provide a more meaningful year-over-year comparison .
interest expense , net of capitalized interest decreased $ 249 million in 2014 from 2013 primarily due to a $ 149 million decrease in special charges recognized year-over-year as further described below , as well as refinancing activities that resulted in $ 100 million less interest expense recognized in 2014 .
( 1 ) in 2014 , we recognized $ 33 million of special charges relating to non-cash interest accretion on bankruptcy settlement obligations .
in 2013 , we recognized $ 138 million of special charges relating to post-petition interest expense on unsecured obligations pursuant to the plan and penalty interest related to american 2019s 10.5% ( 10.5 % ) secured notes and 7.50% ( 7.50 % ) senior secured notes .
in addition , in 2013 we recorded special charges of $ 44 million for debt extinguishment costs incurred as a result of the repayment of certain aircraft secured indebtedness , including cash interest charges and non-cash write offs of unamortized debt issuance costs .
( 2 ) as a result of the 2013 refinancing activities and the early extinguishment of american 2019s 7.50% ( 7.50 % ) senior secured notes in 2014 , we recognized $ 100 million less interest expense in 2014 as compared to 2013 .
other nonoperating expense , net in 2014 consisted of $ 114 million of net foreign currency losses , including a $ 43 million special charge for venezuelan foreign currency losses , and $ 56 million in other nonoperating special charges primarily due to early debt extinguishment costs related to the prepayment of our 7.50% ( 7.50 % ) senior secured notes and other indebtedness .
the foreign currency losses were driven primarily by the strengthening of the u.s .
dollar relative to other currencies during 2014 , principally in the latin american market , including a 48% ( 48 % ) decrease in the value of the venezuelan bolivar and a 14% ( 14 % ) decrease in the value of the brazilian real .
other nonoperating expense , net in 2013 consisted principally of net foreign currency losses of $ 56 million and early debt extinguishment charges of $ 29 million .
reorganization items , net reorganization items refer to revenues , expenses ( including professional fees ) , realized gains and losses and provisions for losses that are realized or incurred as a direct result of the chapter 11 cases .
the following table summarizes the components included in reorganization items , net on aag 2019s consolidated statement of operations for the year ended december 31 , 2013 ( in millions ) : .
| 2013
------------------------------------------------------------------------- | ------
labor-related deemed claim ( 1 ) | $ 1733
aircraft and facility financing renegotiations and rejections ( 2 ) ( 3 ) | 325
fair value of conversion discount ( 4 ) | 218
professional fees | 199
other | 180
total reorganization items net | $ 2655
( 1 ) in exchange for employees 2019 contributions to the successful reorganization , including agreeing to reductions in pay and benefits , we agreed in the plan to provide each employee group a deemed claim , which was used to provide a distribution of a portion of the equity of the reorganized entity to those employees .
each employee group received a deemed claim amount based upon a portion of the value of cost savings provided by that group through reductions to pay and benefits as well as through certain work rule changes .
the total value of this deemed claim was approximately $ 1.7 billion .
( 2 ) amounts include allowed claims ( claims approved by the bankruptcy court ) and estimated allowed claims relating to ( i ) the rejection or modification of financings related to aircraft and ( ii ) entry of orders treated as unsecured claims with respect to facility agreements supporting certain issuances of special facility revenue bonds .
the debtors recorded an estimated claim associated with the rejection or modification of a financing |
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dd4b8ca2a | contingencies we are exposed to certain known contingencies that are material to our investors .
the facts and circumstances surrounding these contingencies and a discussion of their effect on us are in note 12 to our audited consolidated financial statements included elsewhere in this annual report on form 10-k .
these contingencies may have a material effect on our liquidity , capital resources or results of operations .
in addition , even where our reserves are adequate , the incurrence of any of these liabilities may have a material effect on our liquidity and the amount of cash available to us for other purposes .
we believe that we have made appropriate arrangements in respect of the future effect on us of these known contingencies .
we also believe that the amount of cash available to us from our operations , together with cash from financing , will be sufficient for us to pay any known contingencies as they become due without materially affecting our ability to conduct our operations and invest in the growth of our business .
off-balance sheet arrangements we do not have any off-balance sheet arrangements except for operating leases entered into in the normal course of business .
contractual obligations and commitments below is a summary of our future payment commitments by year under contractual obligations as of december 31 , 2018: .
( in millions ) | 2019 | 2020 - 2021 | 2022 - 2023 | thereafter | total
---------------------------------------------- | ------ | ----------- | ----------- | ---------- | -------
long-term debt including interest ( 1 ) | $ 508 | $ 1287 | $ 3257 | $ 8167 | $ 13219
operating leases | 167 | 244 | 159 | 119 | 689
data acquisition | 289 | 467 | 135 | 4 | 895
purchase obligations ( 2 ) | 17 | 22 | 15 | 8 | 62
commitments to unconsolidated affiliates ( 3 ) | 2014 | 2014 | 2014 | 2014 | 2014
benefit obligations ( 4 ) | 25 | 27 | 29 | 81 | 162
uncertain income tax positions ( 5 ) | 17 | 2014 | 2014 | 2014 | 17
total | $ 1023 | $ 2047 | $ 3595 | $ 8379 | $ 15044
( 1 ) interest payments on our debt are based on the interest rates in effect on december 31 , 2018 .
( 2 ) purchase obligations are defined as agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms , including fixed or minimum quantities to be purchased , fixed , minimum or variable pricing provisions and the approximate timing of the transactions .
( 3 ) we are currently committed to invest $ 120 million in private equity funds .
as of december 31 , 2018 , we have funded approximately $ 78 million of these commitments and we have approximately $ 42 million remaining to be funded which has not been included in the above table as we are unable to predict when these commitments will be paid .
( 4 ) amounts represent expected future benefit payments for our pension and postretirement benefit plans , as well as expected contributions for 2019 for our funded pension benefit plans .
we made cash contributions totaling approximately $ 31 million to our defined benefit plans in 2018 , and we estimate that we will make contributions totaling approximately $ 25 million to our defined benefit plans in 2019 .
due to the potential impact of future plan investment performance , changes in interest rates , changes in other economic and demographic assumptions and changes in legislation in foreign jurisdictions , we are not able to reasonably estimate the timing and amount of contributions that may be required to fund our defined benefit plans for periods beyond 2019 .
( 5 ) as of december 31 , 2018 , our liability related to uncertain income tax positions was approximately $ 106 million , $ 89 million of which has not been included in the above table as we are unable to predict when these liabilities will be paid due to the uncertainties in the timing of the settlement of the income tax positions. |
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dd4ba6a56 | the company entered into agreements with various governmental entities in the states of kentucky , georgia and tennessee to implement tax abatement plans related to its distribution center in franklin , kentucky ( simpson county ) , its distribution center in macon , georgia ( bibb county ) , and its store support center in brentwood , tennessee ( williamson county ) .
the tax abatement plans provide for reduction of real property taxes for specified time frames by legally transferring title to its real property in exchange for industrial revenue bonds .
this property was then leased back to the company .
no cash was exchanged .
the lease payments are equal to the amount of the payments on the bonds .
the tax abatement period extends through the term of the lease , which coincides with the maturity date of the bonds .
at any time , the company has the option to purchase the real property by paying off the bonds , plus $ 1 .
the terms and amounts authorized and drawn under each industrial revenue bond agreement are outlined as follows , as of december 30 , 2017 : bond term bond authorized amount ( in millions ) amount drawn ( in millions ) .
| bond term | bond authorized amount ( in millions ) | amount drawn ( in millions )
---------------------------------------- | --------- | -------------------------------------- | ----------------------------
franklin kentucky distribution center | 30 years | $ 54.0 | $ 51.8
macon georgia distribution center | 15 years | $ 58.0 | $ 49.9
brentwood tennessee store support center | 10 years | $ 78.0 | $ 75.3
due to the form of these transactions , the company has not recorded the bonds or the lease obligation associated with the sale lease-back transaction .
the original cost of the company 2019s property and equipment is recorded on the balance sheet and is being depreciated over its estimated useful life .
capitalized software costs the company capitalizes certain costs related to the acquisition and development of software and amortizes these costs using the straight-line method over the estimated useful life of the software , which is three to five years .
computer software consists of software developed for internal use and third-party software purchased for internal use .
a subsequent addition , modification or upgrade to internal-use software is capitalized to the extent that it enhances the software 2019s functionality or extends its useful life .
these costs are included in computer software and hardware in the accompanying consolidated balance sheets .
certain software costs not meeting the criteria for capitalization are expensed as incurred .
store closing costs the company regularly evaluates the performance of its stores and periodically closes those that are under-performing .
the company records a liability for costs associated with an exit or disposal activity when the liability is incurred , usually in the period the store closes .
store closing costs were not significant to the results of operations for any of the fiscal years presented .
leases assets under capital leases are amortized in accordance with the company 2019s normal depreciation policy for owned assets or over the lease term , if shorter , and the related charge to operations is included in depreciation expense in the consolidated statements of income .
certain operating leases include rent increases during the lease term .
for these leases , the company recognizes the related rental expense on a straight-line basis over the term of the lease ( which includes the pre-opening period of construction , renovation , fixturing and merchandise placement ) and records the difference between the expense charged to operations and amounts paid as a deferred rent liability .
the company occasionally receives reimbursements from landlords to be used towards improving the related store to be leased .
leasehold improvements are recorded at their gross costs , including items reimbursed by landlords .
related reimbursements are deferred and amortized on a straight-line basis as a reduction of rent expense over the applicable lease term .
note 2 - share-based compensation : share-based compensation includes stock option and restricted stock unit awards and certain transactions under the company 2019s espp .
share-based compensation expense is recognized based on the grant date fair value of all stock option and restricted stock unit awards plus a discount on shares purchased by employees as a part of the espp .
the discount under the espp represents the difference between the purchase date market value and the employee 2019s purchase price. |
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dd4c5d35a | performance graph the following graph is a comparison of the five-year cumulative return of our common shares , the standard & poor 2019s 500 index ( the 201cs&p 500 index 201d ) and the national association of real estate investment trusts 2019 ( 201cnareit 201d ) all equity index , a peer group index .
the graph assumes that $ 100 was invested on december 31 , 2009 in our common shares , the s&p 500 index and the nareit all equity index and that all dividends were reinvested without the payment of any commissions .
there can be no assurance that the performance of our shares will continue in line with the same or similar trends depicted in the graph below. .
| 2009 | 2010 | 2011 | 2012 | 2013 | 2014
--------------------------- | ----- | ----- | ----- | ----- | ----- | -----
vornado realty trust | $ 100 | $ 123 | $ 118 | $ 128 | $ 147 | $ 201
s&p 500 index | 100 | 115 | 117 | 136 | 180 | 205
the nareit all equity index | 100 | 128 | 139 | 166 | 171 | 218 |
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dd4bce560 | contractual obligations the following table summarizes our significant contractual obligations as of december 28 , 2013: .
( in millions ) | payments due by period total | payments due by period less than1 year | payments due by period 1 20133 years | payments due by period 3 20135 years | payments due by period more than5 years
------------------------------------------- | ---------------------------- | -------------------------------------- | ------------------------------------ | ------------------------------------ | ---------------------------------------
operating lease obligations | $ 870 | $ 208 | $ 298 | $ 166 | $ 198
capital purchase obligations1 | 5503 | 5375 | 125 | 2014 | 3
other purchase obligations and commitments2 | 1859 | 772 | 744 | 307 | 36
long-term debt obligations3 | 22372 | 429 | 2360 | 3761 | 15822
other long-term liabilities4 5 | 1496 | 569 | 663 | 144 | 120
total6 | $ 32100 | $ 7353 | $ 4190 | $ 4378 | $ 16179
capital purchase obligations1 5503 5375 125 2014 3 other purchase obligations and commitments2 1859 772 744 307 36 long-term debt obligations3 22372 429 2360 3761 15822 other long-term liabilities4 , 5 1496 569 663 144 120 total6 $ 32100 $ 7353 $ 4190 $ 4378 $ 16179 1 capital purchase obligations represent commitments for the construction or purchase of property , plant and equipment .
they were not recorded as liabilities on our consolidated balance sheets as of december 28 , 2013 , as we had not yet received the related goods or taken title to the property .
2 other purchase obligations and commitments include payments due under various types of licenses and agreements to purchase goods or services , as well as payments due under non-contingent funding obligations .
funding obligations include agreements to fund various projects with other companies .
3 amounts represent principal and interest cash payments over the life of the debt obligations , including anticipated interest payments that are not recorded on our consolidated balance sheets .
any future settlement of convertible debt would impact our cash payments .
4 we are unable to reliably estimate the timing of future payments related to uncertain tax positions ; therefore , $ 188 million of long-term income taxes payable has been excluded from the preceding table .
however , long- term income taxes payable , recorded on our consolidated balance sheets , included these uncertain tax positions , reduced by the associated federal deduction for state taxes and u.s .
tax credits arising from non- u.s .
income taxes .
5 amounts represent future cash payments to satisfy other long-term liabilities recorded on our consolidated balance sheets , including the short-term portion of these long-term liabilities .
expected required contributions to our u.s .
and non-u.s .
pension plans and other postretirement benefit plans of $ 62 million to be made during 2014 are also included ; however , funding projections beyond 2014 are not practicable to estimate .
6 total excludes contractual obligations already recorded on our consolidated balance sheets as current liabilities except for the short-term portions of long-term debt obligations and other long-term liabilities .
contractual obligations for purchases of goods or services , included in other purchase obligations and commitments in the preceding table , include agreements that are enforceable and legally binding on intel and that specify all significant terms , including fixed or minimum quantities to be purchased ; fixed , minimum , or variable price provisions ; and the approximate timing of the transaction .
for obligations with cancellation provisions , the amounts included in the preceding table were limited to the non-cancelable portion of the agreement terms or the minimum cancellation fee .
we have entered into certain agreements for the purchase of raw materials that specify minimum prices and quantities based on a percentage of the total available market or based on a percentage of our future purchasing requirements .
due to the uncertainty of the future market and our future purchasing requirements , as well as the non-binding nature of these agreements , obligations under these agreements are not included in the preceding table .
our purchase orders for other products are based on our current manufacturing needs and are fulfilled by our vendors within short time horizons .
in addition , some of our purchase orders represent authorizations to purchase rather than binding agreements .
table of contents management 2019s discussion and analysis of financial condition and results of operations ( continued ) |
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dd4c59dea | republic services , inc .
notes to consolidated financial statements 2014 ( continued ) credit exposure , we continually monitor the credit worthiness of the financial institutions where we have deposits .
concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers and markets in which we provide services , as well as the dispersion of our operations across many geographic areas .
we provide services to small-container commercial , large-container industrial , municipal and residential customers in the united states and puerto rico .
we perform ongoing credit evaluations of our customers , but generally do not require collateral to support customer receivables .
we establish an allowance for doubtful accounts based on various factors including the credit risk of specific customers , age of receivables outstanding , historical trends , economic conditions and other information .
accounts receivable , net accounts receivable represent receivables from customers for collection , transfer , recycling , disposal , energy services and other services .
our receivables are recorded when billed or when the related revenue is earned , if earlier , and represent claims against third parties that will be settled in cash .
the carrying value of our receivables , net of the allowance for doubtful accounts and customer credits , represents their estimated net realizable value .
provisions for doubtful accounts are evaluated on a monthly basis and are recorded based on our historical collection experience , the age of the receivables , specific customer information and economic conditions .
we also review outstanding balances on an account-specific basis .
in general , reserves are provided for accounts receivable in excess of 90 days outstanding .
past due receivable balances are written-off when our collection efforts have been unsuccessful in collecting amounts due .
the following table reflects the activity in our allowance for doubtful accounts for the years ended december 31: .
| 2015 | 2014 | 2013
---------------------------- | -------------- | -------------- | --------------
balance at beginning of year | $ 38.9 | $ 38.3 | $ 45.3
additions charged to expense | 22.7 | 22.6 | 16.1
accounts written-off | -14.9 ( 14.9 ) | -22.0 ( 22.0 ) | -23.1 ( 23.1 )
balance at end of year | $ 46.7 | $ 38.9 | $ 38.3
restricted cash and marketable securities as of december 31 , 2015 , we had $ 100.3 million of restricted cash and marketable securities .
we obtain funds through the issuance of tax-exempt bonds for the purpose of financing qualifying expenditures at our landfills , transfer stations , collection and recycling centers .
the funds are deposited directly into trust accounts by the bonding authorities at the time of issuance .
as the use of these funds is contractually restricted , and we do not have the ability to use these funds for general operating purposes , they are classified as restricted cash and marketable securities in our consolidated balance sheets .
in the normal course of business , we may be required to provide financial assurance to governmental agencies and a variety of other entities in connection with municipal residential collection contracts , closure or post- closure of landfills , environmental remediation , environmental permits , and business licenses and permits as a financial guarantee of our performance .
at several of our landfills , we satisfy financial assurance requirements by depositing cash into restricted trust funds or escrow accounts .
property and equipment we record property and equipment at cost .
expenditures for major additions and improvements to facilities are capitalized , while maintenance and repairs are charged to expense as incurred .
when property is retired or otherwise disposed , the related cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the consolidated statements of income. |
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dd4984962 | interest rate cash flow hedges 2013 we report changes in the fair value of cash flow hedges in accumulated other comprehensive loss until the hedged item affects earnings .
at both december 31 , 2008 and 2007 , we had reductions of $ 4 million recorded as an accumulated other comprehensive loss that is being amortized on a straight-line basis through september 30 , 2014 .
as of december 31 , 2008 and 2007 , we had no interest rate cash flow hedges outstanding .
earnings impact 2013 our use of derivative financial instruments had the following impact on pre-tax income for the years ended december 31 : millions of dollars 2008 2007 2006 .
millions of dollars | 2008 | 2007 | 2006
--------------------------------------------------------------------- | ---- | ---------- | ----------
( increase ) /decrease in interest expense from interest rate hedging | $ 1 | $ -8 ( 8 ) | $ -8 ( 8 )
( increase ) /decrease in fuel expense from fuel derivatives | 1 | -1 ( 1 ) | 3
increase/ ( decrease ) in pre-tax income | $ 2 | $ -9 ( 9 ) | $ -5 ( 5 )
fair value of debt instruments 2013 the fair value of our short- and long-term debt was estimated using quoted market prices , where available , or current borrowing rates .
at december 31 , 2008 , the fair value of total debt is approximately $ 247 million less than the carrying value .
at december 31 , 2007 , the fair value of total debt exceeded the carrying value by approximately $ 96 million .
at december 31 , 2008 and 2007 , approximately $ 320 million and $ 181 million , respectively , of fixed-rate debt securities contained call provisions that allowed us to retire the debt instruments prior to final maturity , with the payment of fixed call premiums , or in certain cases , at par .
sale of receivables 2013 the railroad transfers most of its accounts receivable to union pacific receivables , inc .
( upri ) , a bankruptcy-remote subsidiary , as part of a sale of receivables facility .
upri sells , without recourse on a 364-day revolving basis , an undivided interest in such accounts receivable to investors .
the total capacity to sell undivided interests to investors under the facility was $ 700 million and $ 600 million at december 31 , 2008 and 2007 , respectively .
the value of the outstanding undivided interest held by investors under the facility was $ 584 million and $ 600 million at december 31 , 2008 and 2007 , respectively .
upri reduced the outstanding undivided interest held by investors due to a decrease in available receivables at december 31 , 2008 .
the value of the outstanding undivided interest held by investors is not included in our consolidated financial statements .
the value of the undivided interest held by investors was supported by $ 1015 million and $ 1071 million of accounts receivable held by upri at december 31 , 2008 and 2007 , respectively .
at december 31 , 2008 and 2007 , the value of the interest retained by upri was $ 431 million and $ 471 million , respectively .
this retained interest is included in accounts receivable in our consolidated financial statements .
the interest sold to investors is sold at carrying value , which approximates fair value , and there is no gain or loss recognized from the transaction .
the value of the outstanding undivided interest held by investors could fluctuate based upon the availability of eligible receivables and is directly affected by changing business volumes and credit risks , including default and dilution .
if default or dilution percentages were to increase one percentage point , the amount of eligible receivables would decrease by $ 6 million .
should our credit rating fall below investment grade , the value of the outstanding undivided interest held by investors would be reduced , and , in certain cases , the investors would have the right to discontinue the facility .
the railroad services the sold receivables ; however , the railroad does not recognize any servicing asset or liability as the servicing fees adequately compensate us for these responsibilities .
the railroad collected approximately $ 17.8 billion and $ 16.1 billion during the years ended december 31 , 2008 and 2007 , respectively .
upri used certain of these proceeds to purchase new receivables under the facility. |
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dd4b8ab80 | freesheet paper were higher in russia , but lower in europe reflecting weak economic conditions and market demand .
average sales price realizations for pulp decreased .
lower input costs for wood and purchased fiber were partially offset by higher costs for energy , chemicals and packaging .
freight costs were also higher .
planned maintenance downtime costs were higher due to executing a significant once-every-ten-years maintenance outage plus the regularly scheduled 18-month outage at the saillat mill while outage costs in russia and poland were lower .
manufacturing operating costs were favor- entering 2013 , sales volumes in the first quarter are expected to be seasonally weaker in russia , but about flat in europe .
average sales price realizations for uncoated freesheet paper are expected to decrease in europe , but increase in russia .
input costs should be higher in russia , especially for wood and energy , but be slightly lower in europe .
no maintenance outages are scheduled for the first quarter .
ind ian papers includes the results of andhra pradesh paper mills ( appm ) of which a 75% ( 75 % ) interest was acquired on october 14 , 2011 .
net sales were $ 185 million in 2012 and $ 35 million in 2011 .
operat- ing profits were a loss of $ 16 million in 2012 and a loss of $ 3 million in 2011 .
asian pr int ing papers net sales were $ 85 mil- lion in 2012 , $ 75 million in 2011 and $ 80 million in 2010 .
operating profits were improved from break- even in past years to $ 1 million in 2012 .
u.s .
pulp net sales were $ 725 million in 2012 compared with $ 725 million in 2011 and $ 715 million in 2010 .
operating profits were a loss of $ 59 million in 2012 compared with gains of $ 87 million in 2011 and $ 107 million in 2010 .
sales volumes in 2012 increased from 2011 primarily due to the start-up of pulp production at the franklin mill in the third quarter of 2012 .
average sales price realizations were significantly lower for both fluff pulp and market pulp .
input costs were lower , primarily for wood and energy .
freight costs were slightly lower .
mill operating costs were unfavorable primarily due to costs associated with the start-up of the franklin mill .
planned maintenance downtime costs were lower .
in the first quarter of 2013 , sales volumes are expected to be flat with the fourth quarter of 2012 .
average sales price realizations are expected to improve reflecting the realization of sales price increases for paper and tissue pulp that were announced in the fourth quarter of 2012 .
input costs should be flat .
planned maintenance downtime costs should be about $ 9 million higher than in the fourth quarter of 2012 .
manufacturing costs related to the franklin mill should be lower as we continue to improve operations .
consumer packaging demand and pricing for consumer packaging prod- ucts correlate closely with consumer spending and general economic activity .
in addition to prices and volumes , major factors affecting the profitability of consumer packaging are raw material and energy costs , freight costs , manufacturing efficiency and product mix .
consumer packaging net sales in 2012 decreased 15% ( 15 % ) from 2011 and 7% ( 7 % ) from 2010 .
operating profits increased 64% ( 64 % ) from 2011 and 29% ( 29 % ) from 2010 .
net sales and operating profits include the shorewood business in 2011 and 2010 .
exclud- ing asset impairment and other charges associated with the sale of the shorewood business , and facility closure costs , 2012 operating profits were 27% ( 27 % ) lower than in 2011 , but 23% ( 23 % ) higher than in 2010 .
benefits from lower raw material costs ( $ 22 million ) , lower maintenance outage costs ( $ 5 million ) and other items ( $ 2 million ) were more than offset by lower sales price realizations and an unfavorable product mix ( $ 66 million ) , lower sales volumes and increased market-related downtime ( $ 22 million ) , and higher operating costs ( $ 40 million ) .
in addition , operating profits in 2012 included a gain of $ 3 million related to the sale of the shorewood business while operating profits in 2011 included a $ 129 million fixed asset impairment charge for the north ameri- can shorewood business and $ 72 million for other charges associated with the sale of the shorewood business .
consumer packaging .
in millions | 2012 | 2011 | 2010
---------------- | ------ | ------ | ------
sales | $ 3170 | $ 3710 | $ 3400
operating profit | 268 | 163 | 207
north american consumer packaging net sales were $ 2.0 billion in 2012 compared with $ 2.5 billion in 2011 and $ 2.4 billion in 2010 .
operating profits were $ 165 million ( $ 162 million excluding a gain related to the sale of the shorewood business ) in 2012 compared with $ 35 million ( $ 236 million excluding asset impairment and other charges asso- ciated with the sale of the shorewood business ) in 2011 and $ 97 million ( $ 105 million excluding facility closure costs ) in 2010 .
coated paperboard sales volumes in 2012 were lower than in 2011 reflecting weaker market demand .
average sales price realizations were lower , primar- ily for folding carton board .
input costs for wood increased , but were partially offset by lower costs for chemicals and energy .
planned maintenance down- time costs were slightly lower .
market-related down- time was about 113000 tons in 2012 compared with about 38000 tons in 2011. |
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dd4c1e8a8 | item 4 .
submission of matters to a vote of security holders no matters were submitted to a vote of security holders during the fourth quarter of 2005 .
part ii item 5 .
market for the registrant 2019s common equity , related stockholder matters and issuer purchases of equity securities market information our series a common stock has traded on the new york stock exchange under the symbol 2018 2018ce 2019 2019 since january 21 , 2005 .
the closing sale price of our series a common stock , as reported by the new york stock exchange , on march 6 , 2006 was $ 20.98 .
the following table sets forth the high and low intraday sales prices per share of our common stock , as reported by the new york stock exchange , for the periods indicated. .
2005 | pricerange high | pricerange low
------------------------------ | --------------- | --------------
quarterended march 312005 | $ 18.65 | $ 15.10
quarter endedjune 302005 | $ 18.16 | $ 13.54
quarter endedseptember 30 2005 | $ 20.06 | $ 15.88
quarter endeddecember 312005 | $ 19.76 | $ 15.58
holders no shares of celanese 2019s series b common stock are issued and outstanding .
as of march 6 , 2006 , there were 51 holders of record of our series a common stock , and one holder of record of our perpetual preferred stock .
by including persons holding shares in broker accounts under street names , however , we estimate our shareholder base to be approximately 6800 as of march 6 , 2006 .
dividend policy in july 2005 , our board of directors adopted a policy of declaring , subject to legally available funds , a quarterly cash dividend on each share of our common stock at an annual rate initially equal to approximately 1% ( 1 % ) of the $ 16 price per share in the initial public offering of our series a common stock ( or $ 0.16 per share ) unless our board of directors , in its sole discretion , determines otherwise , commencing the second quarter of 2005 .
pursuant to this policy , the company paid the quarterly dividends of $ 0.04 per share on august 11 , 2005 , november 1 , 2005 and february 1 , 2006 .
based on the number of outstanding shares of our series a common stock , the anticipated annual cash dividend is approximately $ 25 million .
however , there is no assurance that sufficient cash will be available in the future to pay such dividend .
further , such dividends payable to holders of our series a common stock cannot be declared or paid nor can any funds be set aside for the payment thereof , unless we have paid or set aside funds for the payment of all accumulated and unpaid dividends with respect to the shares of our preferred stock , as described below .
our board of directors may , at any time , modify or revoke our dividend policy on our series a common stock .
we are required under the terms of the preferred stock to pay scheduled quarterly dividends , subject to legally available funds .
for so long as the preferred stock remains outstanding , ( 1 ) we will not declare , pay or set apart funds for the payment of any dividend or other distribution with respect to any junior stock or parity stock and ( 2 ) neither we , nor any of our subsidiaries , will , subject to certain exceptions , redeem , purchase or otherwise acquire for consideration junior stock or parity stock through a sinking fund or otherwise , in each case unless we have paid or set apart funds for the payment of all accumulated and unpaid dividends with respect to the shares of preferred stock and any parity stock for all preceding dividend periods .
pursuant to this policy , the company paid the quarterly dividends of $ 0.265625 on its 4.25% ( 4.25 % ) convertible perpetual preferred stock on august 1 , 2005 , november 1 , 2005 and february 1 , 2006 .
the anticipated annual cash dividend is approximately $ 10 million. |
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dd4bde5c8 | overview we finance our operations and capital expenditures through a combination of internally generated cash from operations and from borrowings under our senior secured asset-based revolving credit facility .
we believe that our current sources of funds will be sufficient to fund our cash operating requirements for the next year .
in addition , we believe that , in spite of the uncertainty of future macroeconomic conditions , we have adequate sources of liquidity and funding available to meet our longer-term needs .
however , there are a number of factors that may negatively impact our available sources of funds .
the amount of cash generated from operations will be dependent upon factors such as the successful execution of our business plan and general economic conditions .
long-term debt activities during the year ended december 31 , 2014 , we had significant debt refinancings .
in connection with these refinancings , we recorded a loss on extinguishment of long-term debt of $ 90.7 million in our consolidated statement of operations for the year ended december 31 , 2014 .
see note 7 to the accompanying audited consolidated financial statements included elsewhere in this report for additional details .
share repurchase program on november 6 , 2014 , we announced that our board of directors approved a $ 500 million share repurchase program effective immediately under which we may repurchase shares of our common stock in the open market or through privately negotiated transactions , depending on share price , market conditions and other factors .
the share repurchase program does not obligate us to repurchase any dollar amount or number of shares , and repurchases may be commenced or suspended from time to time without prior notice .
as of the date of this filing , no shares have been repurchased under the share repurchase program .
dividends a summary of 2014 dividend activity for our common stock is shown below: .
dividend amount | declaration date | record date | payment date
--------------- | ---------------- | ---------------- | -----------------
$ 0.0425 | february 12 2014 | february 25 2014 | march 10 2014
$ 0.0425 | may 8 2014 | may 27 2014 | june 10 2014
$ 0.0425 | july 31 2014 | august 25 2014 | september 10 2014
$ 0.0675 | november 6 2014 | november 25 2014 | december 10 2014
on february 10 , 2015 , we announced that our board of directors declared a quarterly cash dividend on our common stock of $ 0.0675 per share .
the dividend will be paid on march 10 , 2015 to all stockholders of record as of the close of business on february 25 , 2015 .
the payment of any future dividends will be at the discretion of our board of directors and will depend upon our results of operations , financial condition , business prospects , capital requirements , contractual restrictions , any potential indebtedness we may incur , restrictions imposed by applicable law , tax considerations and other factors that our board of directors deems relevant .
in addition , our ability to pay dividends on our common stock will be limited by restrictions on our ability to pay dividends or make distributions to our stockholders and on the ability of our subsidiaries to pay dividends or make distributions to us , in each case , under the terms of our current and any future agreements governing our indebtedness .
table of contents |
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dd4c52d60 | the fair value of options that vested during the years ended december 31 , 2017 , 2016 and 2015 was $ 6.8 million , $ 6.0 million and $ 7.8 million , respectively .
the intrinsic value of fortune brands stock options exercised in the years ended december 31 , 2017 , 2016 and 2015 was $ 70.6 million , $ 88.1 million and $ 78.0 million , respectively .
performance awards performance share awards were granted to officers and certain employees of the company under the plans and represent the right to earn shares of company common stock based on the achievement of or company-wide performance conditions , including cumulative diluted earnings per share , average return on invested capital , average return on net tangible assets and ebitda during the three-year performance period .
compensation cost is amortized into expense over the performance period , which is generally three years , and is based on the probability of meeting performance targets .
the fair value of each performance share award is based on the average of the high and low stock price on the date of grant .
the following table summarizes information about performance share awards as of december 31 , 2017 , as well as activity during the year then ended .
the number of performance share awards granted are shown below at the target award amounts : number of performance share awards weighted-average grant-date fair value .
| number of performance share awards | weighted-averagegrant-datefair value
----------------------------- | ---------------------------------- | ------------------------------------
non-vestedat december 31 2016 | 421600 | $ 48.00
granted | 160196 | 58.02
vested | -95183 ( 95183 ) | 45.13
forfeited | -58285 ( 58285 ) | 48.22
non-vestedat december 31 2017 | 428328 | $ 52.35
the remaining unrecognized pre-tax compensation cost related to performance share awards at december 31 , 2017 was approximately $ 6.8 million , and the weighted-average period of time over which this cost will be recognized is 1.3 years .
the fair value of performance share awards that vested during 2017 was $ 5.6 million ( 100580 shares ) .
director awards stock awards are used as part of the compensation provided to outside directors under the plan .
awards are issued annually in the second quarter .
in addition , outside directors can elect to have director fees paid in stock or can elect to defer payment of stock .
compensation cost is expensed at the time of an award based on the fair value of a share at the date of the award .
in 2017 , 2016 and 2015 , we awarded 15311 , 16471 and 19695 shares of company common stock to outside directors with a weighted average fair value on the date of the award of $ 63.43 , $ 57.37 and $ 46.21 , respectively .
14 .
defined benefit plans we have a number of pension plans in the united states , covering many of the company 2019s employees , however these plans have been closed to new hires .
the plans provide for payment of retirement benefits , mainly commencing between the ages of 55 and 65 .
after meeting certain qualifications , an employee acquires a vested right to future benefits .
the benefits payable under the plans are generally determined on the basis of an employee 2019s length of service and/or earnings .
employer contributions to the plans are made , as necessary , to ensure legal funding requirements are satisfied .
also , from time to time , we may make contributions in excess of the legal funding requirements .
service cost for 2017 relates to benefit accruals in an hourly union defined benefit plan in our security segment .
benefit accruals under all other defined benefit pension plans were frozen as of december 31 , 2016. |
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dd4bb7e1e | there are inherent limitations on the effectiveness of our controls .
we do not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all errors and all fraud .
a control system , no matter how well-designed and operated , can provide only reasonable , not absolute , assurance that the control system 2019s objectives will be met .
the design of a control system must reflect the fact that resource constraints exist , and the benefits of controls must be considered relative to their costs .
further , because of the inherent limitations in all control systems , no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud , if any , have been detected .
the design of any system of controls is based in part on certain assumptions about the likelihood of future events , and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions .
projections of any evaluation of the effectiveness of controls to future periods are subject to risks .
over time , controls may become inadequate due to changes in conditions or deterioration in the degree of compliance with policies or procedures .
if our controls become inadequate , we could fail to meet our financial reporting obligations , our reputation may be adversely affected , our business and operating results could be harmed , and the market price of our stock could decline .
item 1b .
unresolved staff comments not applicable .
item 2 .
properties as of december 31 , 2016 , our major facilities consisted of : ( square feet in millions ) united states countries total owned facilities1 .
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31.5 19.2 50.7 leased facilities2 .
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2.5 7.1 9.6 .
( square feet in millions ) | unitedstates | othercountries | total
--------------------------- | ------------ | -------------- | -----
owned facilities1 | 31.5 | 19.2 | 50.7
leased facilities2 | 2.5 | 7.1 | 9.6
total facilities | 34.0 | 26.3 | 60.3
1 leases and municipal grants on portions of the land used for these facilities expire on varying dates through 2109 .
2 leases expire on varying dates through 2058 and generally include renewals at our option .
our principal executive offices are located in the u.s .
and the majority of our wafer manufacturing activities in 2016 were also located in the u.s .
one of our arizona wafer fabrication facilities is currently on hold and held in a safe state , and we are reserving the building for additional capacity and future technologies .
incremental construction and equipment installation are required to ready the facility for its intended use .
for more information on our wafer fabrication and our assembly and test facilities , see 201cmanufacturing and assembly and test 201d in part i , item 1 of this form 10-k .
we believe that the facilities described above are suitable and adequate for our present purposes and that the productive capacity in our facilities is substantially being utilized or we have plans to utilize it .
we do not identify or allocate assets by operating segment .
for information on net property , plant and equipment by country , see 201cnote 4 : operating segments and geographic information 201d in part ii , item 8 of this form 10-k .
item 3 .
legal proceedings for a discussion of legal proceedings , see 201cnote 20 : commitments and contingencies 201d in part ii , item 8 of this form 10-k .
item 4 .
mine safety disclosures not applicable. |
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dd4be4a2c | table of contents marketaxess holdings inc .
notes to consolidated financial statements 2014 ( continued ) of this standard had no material effect on the company 2019s consolidated statements of financial condition and consolidated statements of operations .
reclassifications certain reclassifications have been made to the prior years 2019 financial statements in order to conform to the current year presentation .
such reclassifications had no effect on previously reported net income .
on march 5 , 2008 , the company acquired all of the outstanding capital stock of greenline financial technologies , inc .
( 201cgreenline 201d ) , an illinois-based provider of integration , testing and management solutions for fix-related products and services designed to optimize electronic trading of fixed-income , equity and other exchange-based products , and approximately ten percent of the outstanding capital stock of tradehelm , inc. , a delaware corporation that was spun-out from greenline immediately prior to the acquisition .
the acquisition of greenline broadens the range of technology services that the company offers to institutional financial markets , provides an expansion of the company 2019s client base , including global exchanges and hedge funds , and further diversifies the company 2019s revenues beyond the core electronic credit trading products .
the results of operations of greenline are included in the consolidated financial statements from the date of the acquisition .
the aggregate consideration for the greenline acquisition was $ 41.1 million , comprised of $ 34.7 million in cash , 725923 shares of common stock valued at $ 5.8 million and $ 0.6 million of acquisition-related costs .
in addition , the sellers were eligible to receive up to an aggregate of $ 3.0 million in cash , subject to greenline attaining certain earn- out targets in 2008 and 2009 .
a total of $ 1.4 million was paid to the sellers in 2009 based on the 2008 earn-out target , bringing the aggregate consideration to $ 42.4 million .
the 2009 earn-out target was not met .
a total of $ 2.0 million of the purchase price , which had been deposited into escrow accounts to satisfy potential indemnity claims , was distributed to the sellers in march 2009 .
the shares of common stock issued to each selling shareholder of greenline were released in two equal installments on december 20 , 2008 and december 20 , 2009 , respectively .
the value ascribed to the shares was discounted from the market value to reflect the non-marketability of such shares during the restriction period .
the purchase price allocation is as follows ( in thousands ) : the amortizable intangibles include $ 3.2 million of acquired technology , $ 3.3 million of customer relationships , $ 1.3 million of non-competition agreements and $ 0.5 million of tradenames .
useful lives of ten years and five years have been assigned to the customer relationships intangible and all other amortizable intangibles , respectively .
the identifiable intangible assets and goodwill are not deductible for tax purposes .
the following unaudited pro forma consolidated financial information reflects the results of operations of the company for the years ended december 31 , 2008 and 2007 , as if the acquisition of greenline had occurred as of the beginning of the period presented , after giving effect to certain purchase accounting adjustments .
these pro forma results are not necessarily indicative of what the company 2019s operating results would have been had the acquisition actually taken place as of the beginning of the earliest period presented .
the pro forma financial information 3 .
acquisitions .
cash | $ 6406
------------------------------------------------------ | --------------
accounts receivable | 2139
amortizable intangibles | 8330
goodwill | 29405
deferred tax assets net | 3410
other assets including investment in tradehelm | 1429
accounts payable accrued expenses and deferred revenue | -8701 ( 8701 )
total purchase price | $ 42418 |
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dd4b8ea14 | challenging investment environment with $ 15.0 billion , or 95% ( 95 % ) , of net inflows coming from institutional clients , with the remaining $ 0.8 billion , or 5% ( 5 % ) , generated by retail and hnw clients .
defined contribution plans of institutional clients remained a significant driver of flows .
this client group added $ 13.1 billion of net new business in 2012 .
during the year , americas net inflows of $ 18.5 billion were partially offset by net outflows of $ 2.6 billion collectively from emea and asia-pacific clients .
the company 2019s multi-asset strategies include the following : 2022 asset allocation and balanced products represented 52% ( 52 % ) , or $ 140.2 billion , of multi-asset class aum at year-end , up $ 14.1 billion , with growth in aum driven by net new business of $ 1.6 billion and $ 12.4 billion in market and foreign exchange gains .
these strategies combine equity , fixed income and alternative components for investors seeking a tailored solution relative to a specific benchmark and within a risk budget .
in certain cases , these strategies seek to minimize downside risk through diversification , derivatives strategies and tactical asset allocation decisions .
2022 target date and target risk products ended the year at $ 69.9 billion , up $ 20.8 billion , or 42% ( 42 % ) , since december 31 , 2011 .
growth in aum was driven by net new business of $ 14.5 billion , a year-over-year organic growth rate of 30% ( 30 % ) .
institutional investors represented 90% ( 90 % ) of target date and target risk aum , with defined contribution plans accounting for over 80% ( 80 % ) of aum .
the remaining 10% ( 10 % ) of target date and target risk aum consisted of retail client investments .
flows were driven by defined contribution investments in our lifepath and lifepath retirement income ae offerings , which are qualified investment options under the pension protection act of 2006 .
these products utilize a proprietary asset allocation model that seeks to balance risk and return over an investment horizon based on the investor 2019s expected retirement timing .
2022 fiduciary management services accounted for 22% ( 22 % ) , or $ 57.7 billion , of multi-asset aum at december 31 , 2012 and increased $ 7.7 billion during the year due to market and foreign exchange gains .
these are complex mandates in which pension plan sponsors retain blackrock to assume responsibility for some or all aspects of plan management .
these customized services require strong partnership with the clients 2019 investment staff and trustees in order to tailor investment strategies to meet client-specific risk budgets and return objectives .
alternatives component changes in alternatives aum ( dollar amounts in millions ) 12/31/2011 net new business acquired market /fx app ( dep ) 12/31/2012 .
( dollar amounts in millions ) | 12/31/2011 | net new business | net acquired | market /fx app ( dep ) | 12/31/2012
------------------------------ | ---------- | ---------------- | ------------ | ---------------------- | ----------
core | $ 63647 | $ -3922 ( 3922 ) | $ 6166 | $ 2476 | $ 68367
currency and commodities | 41301 | -1547 ( 1547 ) | 860 | 814 | 41428
alternatives | $ 104948 | $ -5469 ( 5469 ) | $ 7026 | $ 3290 | $ 109795
alternatives aum totaled $ 109.8 billion at year-end 2012 , up $ 4.8 billion , or 5% ( 5 % ) , reflecting $ 3.3 billion in portfolio valuation gains and $ 7.0 billion in new assets related to the acquisitions of srpep , which deepened our alternatives footprint in the european and asian markets , and claymore .
core alternative outflows of $ 3.9 billion were driven almost exclusively by return of capital to clients .
currency net outflows of $ 5.0 billion were partially offset by net inflows of $ 3.5 billion into ishares commodity funds .
we continued to make significant investments in our alternatives platform as demonstrated by our acquisition of srpep , successful closes on the renewable power initiative and our build out of an alternatives retail platform , which now stands at nearly $ 10.0 billion in aum .
we believe that as alternatives become more conventional and investors adapt their asset allocation strategies to best meet their investment objectives , they will further increase their use of alternative investments to complement core holdings .
institutional investors represented 69% ( 69 % ) , or $ 75.8 billion , of alternatives aum with retail and hnw investors comprising an additional 9% ( 9 % ) , or $ 9.7 billion , at year-end 2012 .
ishares commodity products accounted for the remaining $ 24.3 billion , or 22% ( 22 % ) , of aum at year-end .
alternative clients are geographically diversified with 56% ( 56 % ) , 26% ( 26 % ) , and 18% ( 18 % ) of clients located in the americas , emea and asia-pacific , respectively .
the blackrock alternative investors ( 201cbai 201d ) group coordinates our alternative investment efforts , including |
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dd4bb1b68 | republic services , inc .
notes to consolidated financial statements 2014 ( continued ) in december 2008 , the board of directors amended and restated the republic services , inc .
2006 incentive stock plan ( formerly known as the allied waste industries , inc .
2006 incentive stock plan ( the 2006 plan ) ) .
allied 2019s shareholders approved the 2006 plan in may 2006 .
the 2006 plan was amended and restated in december 2008 to reflect republic as the new sponsor of the plan , and that any references to shares of common stock are to shares of common stock of republic , and to adjust outstanding awards and the number of shares available under the plan to reflect the allied acquisition .
the 2006 plan , as amended and restated , provided for the grant of non- qualified stock options , incentive stock options , shares of restricted stock , shares of phantom stock , stock bonuses , restricted stock units , stock appreciation rights , performance awards , dividend equivalents , cash awards , or other stock-based awards .
awards granted under the 2006 plan prior to december 5 , 2008 became fully vested and nonforfeitable upon the closing of the allied acquisition .
no further awards will be made under the 2006 stock options we use a lattice binomial option-pricing model to value our stock option grants .
we recognize compensation expense on a straight-line basis over the requisite service period for each separately vesting portion of the award , or to the employee 2019s retirement eligible date , if earlier .
expected volatility is based on the weighted average of the most recent one year volatility and a historical rolling average volatility of our stock over the expected life of the option .
the risk-free interest rate is based on federal reserve rates in effect for bonds with maturity dates equal to the expected term of the option .
we use historical data to estimate future option exercises , forfeitures ( at 3.0% ( 3.0 % ) for each of the periods presented ) and expected life of the options .
when appropriate , separate groups of employees that have similar historical exercise behavior are considered separately for valuation purposes .
the weighted-average estimated fair values of stock options granted during the years ended december 31 , 2014 , 2013 and 2012 were $ 5.74 , $ 5.27 and $ 4.77 per option , respectively , which were calculated using the following weighted-average assumptions: .
| 2014 | 2013 | 2012
----------------------------- | ---------------- | ---------------- | ----------------
expected volatility | 27.5% ( 27.5 % ) | 28.9% ( 28.9 % ) | 27.8% ( 27.8 % )
risk-free interest rate | 1.4% ( 1.4 % ) | 0.7% ( 0.7 % ) | 0.8% ( 0.8 % )
dividend yield | 3.2% ( 3.2 % ) | 3.2% ( 3.2 % ) | 3.2% ( 3.2 % )
expected life ( in years ) | 4.6 | 4.5 | 4.5
contractual life ( in years ) | 7.0 | 7.0 | 7.0 |
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dd4c3f4c2 | stock performance graph the following graph compares the most recent five-year performance of alcoa 2019s common stock with ( 1 ) the standard & poor 2019s 500 ae index and ( 2 ) the standard & poor 2019s 500 ae materials index , a group of 27 companies categorized by standard & poor 2019s as active in the 201cmaterials 201d market sector .
such information shall not be deemed to be 201cfiled . 201d five-year cumulative total return based upon an initial investment of $ 100 on december 31 , 2010 with dividends reinvested alcoa inc .
s&p 500 ae index s&p 500 ae materials index dec-'10 dec-'11 dec-'12 dec-'14 dec-'15dec-'13 .
as of december 31, | 2010 | 2011 | 2012 | 2013 | 2014 | 2015
------------------------- | ----- | ---- | ---- | ---- | ----- | ----
alcoainc . | $ 100 | $ 57 | $ 58 | $ 72 | $ 107 | $ 68
s&p 500 aeindex | 100 | 102 | 118 | 157 | 178 | 181
s&p 500 aematerials index | 100 | 90 | 104 | 130 | 139 | 128
s&p 500 ae index 100 102 118 157 178 181 s&p 500 ae materials index 100 90 104 130 139 128 copyright a9 2016 standard & poor 2019s , a division of the mcgraw-hill companies inc .
all rights reserved .
source : research data group , inc .
( www.researchdatagroup.com/s&p.htm ) |
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dd497cdca | earnings for the first quarter of 2007 are expected to be lower than in the fourth quarter of 2006 .
containerboard export sales volumes are expected to decline due to scheduled first-quarter main- tenance outages .
sales volumes for u.s .
converted products will be higher due to more shipping days , but expected softer demand should cause the ship- ments per day to decrease .
average sales price real- izations are expected to be comparable to fourth- quarter averages .
an additional containerboard price increase was announced in january that is expected to be fully realized in the second quarter .
costs for wood , energy , starch , adhesives and freight are expected to increase .
manufacturing costs will be higher due to costs associated with scheduled main- tenance outages in the containerboard mills .
euro- pean container operating results are expected to improve as seasonally higher sales volumes and improved margins more than offset slightly higher manufacturing costs .
consumer packaging demand and pricing for consumer packaging prod- ucts correlate closely with consumer spending and general economic activity .
in addition to prices and volumes , major factors affecting the profitability of consumer packaging are raw material and energy costs , manufacturing efficiency and product mix .
consumer packaging net sales increased 9% ( 9 % ) compared with 2005 and 7% ( 7 % ) compared with 2004 .
operating profits rose 8% ( 8 % ) from 2005 , but declined 15% ( 15 % ) from 2004 levels .
compared with 2005 , higher sales volumes ( $ 9 million ) , improved average sales price realizations ( $ 33 million ) , reduced lack-of-order downtime ( $ 18 million ) , and favorable mill oper- ations ( $ 25 million ) were partially offset by higher raw material costs ( $ 19 million ) and freight costs ( $ 21 million ) , unfavorable mix ( $ 14 million ) and other costs ( $ 21 million ) .
consumer packaging in millions 2006 2005 2004 .
in millions | 2006 | 2005 | 2004
---------------- | ------ | ------ | ------
sales | $ 2455 | $ 2245 | $ 2295
operating profit | $ 131 | $ 121 | $ 155
coated paperboard net sales of $ 1.5 billion in 2006 were higher than $ 1.3 billion in 2005 and $ 1.1 billion in 2004 .
sales volumes increased in 2006 compared with 2005 , particularly in the folding car- ton board segment , reflecting improved demand for coated paperboard products .
in 2006 , our coated paperboard mills took 4000 tons of lack-of-order downtime , compared with 82000 tons of lack-of-order downtime in 2005 .
average sales price realizations were substantially improved in the cur- rent year , principally for folding carton board and cupstock board .
operating profits were 51% ( 51 % ) higher in 2006 than in 2005 , and 7% ( 7 % ) better than in 2004 .
the impact of the higher sales prices along with more favorable manufacturing operations due to strong performance at the mills more than offset higher input costs for energy and freight .
foodservice net sales declined to $ 396 million in 2006 , compared with $ 437 million in 2005 and $ 480 million in 2004 , due principally to the sale of the jackson , tennessee plant in july 2005 .
sales vol- umes were lower in 2006 than in 2005 , although average sales prices were higher due to the realiza- tion of price increases implemented during 2005 .
operating profits for 2006 improved over 2005 and 2004 levels largely due to the benefits from higher sales prices .
raw material costs for bleached board were higher than in 2005 , but manufacturing costs were more favorable due to increased productivity and reduced waste .
shorewood net sales of $ 670 million were down from $ 691 million in 2005 and $ 687 million in 2004 .
sales volumes in 2006 were down from 2005 levels due to weak demand in the home entertainment and consumer products markets , although demand was strong in the tobacco segment .
average sales prices for the year were lower than in 2005 .
operating prof- its were down significantly from both 2005 and 2004 due to the decline in sales , particularly in the higher margin home entertainment markets , higher raw material costs for bleached board and certain inventory adjustment costs .
entering 2007 , coated paperboard first-quarter sales volumes are expected to be seasonally stronger than in the fourth quarter 2006 for folding carton board and bristols .
average sales price realizations are expected to rise with a price increase announced in january .
it is anticipated that manufacturing costs will improve versus an unfavorable fourth quarter .
foodservice earnings for the first quarter of 2007 are expected to decline due to seasonally weaker vol- ume .
however , sales price realizations will be slightly higher , and the seasonal switch to hot cup contain- ers will have a favorable impact on product mix .
shorewood sales volumes for the first quarter of 2007 are expected to seasonally decline , but the earnings impact will be partially offset by pricing improvements and an improved product mix .
distribution our distribution business , principally represented by our xpedx business , markets a diverse array of products and supply chain services to customers in |
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dd49785cc | the aes corporation notes to consolidated financial statements 2014 ( continued ) december 31 , 2017 , 2016 , and 2015 was dispatched starting in february 2018 .
aes puerto rico continues to be the lowest cost and epa compliant energy provider in puerto rico .
therefore , we expect aes puerto rico to continue to be a critical supplier to prepa .
starting prior to the hurricanes , prepa has been facing economic challenges that could impact the company , and on july 2 , 2017 , filed for bankruptcy under title iii .
as a result of the bankruptcy filing , aes puerto rico and aes ilumina 2019s non-recourse debt of $ 365 million and $ 36 million , respectively , is in default and has been classified as current as of december 31 , 2017 .
in november 2017 , aes puerto rico signed a forbearance and standstill agreement with its lenders to prevent the lenders from taking any action against the company due to the default events .
this agreement will expire on march 22 , 2018 .
the company's receivable balances in puerto rico as of december 31 , 2017 totaled $ 86 million , of which $ 53 million was overdue .
after the filing of title iii protection , and up until the disruption caused by the hurricanes , aes in puerto rico was collecting the overdue amounts from prepa in line with historic payment patterns .
considering the information available as of the filing date , management believes the carrying amount of our assets in puerto rico of $ 627 million is recoverable as of december 31 , 2017 and no reserve on the receivables is required .
foreign currency risks 2014 aes operates businesses in many foreign countries and such operations could be impacted by significant fluctuations in foreign currency exchange rates .
fluctuations in currency exchange rate between u.s .
dollar and the following currencies could create significant fluctuations in earnings and cash flows : the argentine peso , the brazilian real , the dominican republic peso , the euro , the chilean peso , the colombian peso , and the philippine peso .
concentrations 2014 due to the geographical diversity of its operations , the company does not have any significant concentration of customers or sources of fuel supply .
several of the company's generation businesses rely on ppas with one or a limited number of customers for the majority of , and in some cases all of , the relevant businesses' output over the term of the ppas .
however , no single customer accounted for 10% ( 10 % ) or more of total revenue in 2017 , 2016 or 2015 .
the cash flows and results of operations of our businesses depend on the credit quality of our customers and the continued ability of our customers and suppliers to meet their obligations under ppas and fuel supply agreements .
if a substantial portion of the company's long-term ppas and/or fuel supply were modified or terminated , the company would be adversely affected to the extent that it would be unable to replace such contracts at equally favorable terms .
26 .
related party transactions certain of our businesses in panama and the dominican republic are partially owned by governments either directly or through state-owned institutions .
in the ordinary course of business , these businesses enter into energy purchase and sale transactions , and transmission agreements with other state-owned institutions which are controlled by such governments .
at two of our generation businesses in mexico , the offtakers exercise significant influence , but not control , through representation on these businesses' boards of directors .
these offtakers are also required to hold a nominal ownership interest in such businesses .
in chile , we provide capacity and energy under contractual arrangements to our investment which is accounted for under the equity method of accounting .
additionally , the company provides certain support and management services to several of its affiliates under various agreements .
the company's consolidated statements of operations included the following transactions with related parties for the periods indicated ( in millions ) : .
years ended december 31, | 2017 | 2016 | 2015
------------------------------- | ------ | ------ | ------
revenue 2014non-regulated | $ 1297 | $ 1100 | $ 1099
cost of sales 2014non-regulated | 220 | 210 | 330
interest income | 8 | 4 | 25
interest expense | 36 | 39 | 33 |
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dd4bbd5e4 | costs .
our 2012 results were lower than 2011 when we realized $ 53.1 million in premium-services margins and our storage and marketing margins consisted of $ 96.0 million from realized seasonal price differentials and marketing optimization activities , and $ 87.7 million of storage demand costs .
in addition , we recognized a loss on the change in fair value of our nonqualifiying economic storage hedges of $ 1.0 million in 2012 compared with a gain of $ 8.5 million in 2011 .
our premium services were impacted negatively by lower natural gas prices and decreased natural gas price volatility .
the impact of our hedge strategies and the inability to hedge seasonal price differentials at levels that were available to us in the prior year significantly reduced our storage margins .
we also experienced reduced opportunities to optimize our storage assets , which negatively impacted our marketing margins .
we realized a loss in our transportation margins of $ 42.4 million in 2012 compared with a loss of $ 18.8 million in 2011 , due primarily to a $ 29.5 million decrease in transportation hedges .
our transportation business continues to be impacted by narrow price location differentials and the inability to hedge at levels that were available to us in prior years .
as a result of significant increases in the supply of natural gas , primarily from shale gas production across north america and new pipeline infrastructure projects , location and seasonal price differentials narrowed significantly beginning in 2010 and continuing through 2012 .
this market change resulted in our transportation contracts being unprofitable impacting our ability to recover our fixed costs .
operating costs decreased due primarily to lower employee-related expenses , which includes the impact of fewer employees .
we also recognized an expense of $ 10.3 million related to the impairment of our goodwill in the first quarter 2012 .
given the significant decline in natural gas prices and its effect on location and seasonal price differentials , we performed an interim impairment assessment in the first quarter 2012 that reduced our goodwill balance to zero .
2011 vs .
2010 - the factors discussed in energy services 2019 201cnarrative description of the business 201d included in item i , business , of this annual report have led to a significant decrease in net margin , including : 2022 a decrease of $ 65.3 million in transportation margins , net of hedging , due primarily to narrower location price differentials and lower hedge settlements in 2011 ; 2022 a decrease of $ 34.3 million in storage and marketing margins , net of hedging activities , due primarily to the following : 2013 lower realized seasonal storage price differentials ; offset partially by 2013 favorable marketing activity and unrealized fair value changes on nonqualifying economic storage hedges ; 2022 a decrease of $ 7.3 million in premium-services margins , associated primarily with the reduction in the value of the fees collected for these services as a result of low commodity prices and reduced natural gas price volatility in the first quarter 2011 compared with the first quarter 2010 ; and 2022 a decrease of $ 4.3 million in financial trading margins , as low natural gas prices and reduced natural gas price volatility limited our financial trading opportunities .
additionally , our 2011 net margin includes $ 91.1 million in adjustments to natural gas inventory reflecting the lower of cost or market value .
because of the adjustments to our inventory value , we reclassified $ 91.1 million of deferred gains on associated cash flow hedges into earnings .
operating costs decreased due primarily to a decrease in ad valorem taxes .
selected operating information - the following table sets forth certain selected operating information for our energy services segment for the periods indicated: .
operating information | years ended december 31 , 2012 | years ended december 31 , 2011 | years ended december 31 , 2010
----------------------------------- | ------------------------------ | ------------------------------ | ------------------------------
natural gas marketed ( bcf ) | 709 | 845 | 919
natural gas gross margin ( $ /mcf ) | $ -0.07 ( 0.07 ) | $ 0.06 | $ 0.18
physically settled volumes ( bcf ) | 1433 | 1724 | 1874
natural gas volumes marketed and physically settled volumes decreased in 2012 compared with 2011 due primarily to decreased marketing activities , lower transported volumes and reduced transportation capacity .
the decrease in 2011 compared with 2010 was due primarily to lower volumes transported and reduced transportation capacity .
transportation capacity in certain markets was not utilized due to the economics of the location price differentials as a result of increased supply of natural gas , primarily from shale production , and increased pipeline capacity as a result of new pipeline construction. |
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dd4bb8602 | worldwide distribution channels the following table presents the number of doors by geographic location , in which ralph lauren-branded products distributed by our wholesale segment were sold to consumers in our primary channels of distribution as of march 31 , 2012 : location number of .
location | number of doors
------------ | ---------------
the americas | 6587
europe | 4377
asia | 83
total | 11047
in addition , american living and chaps-branded products distributed by our wholesale segment were sold domestically through approximately 1800 doors as of march 31 , 2012 .
we have three key wholesale customers that generate significant sales volume .
for fiscal 2012 , these customers in the aggregate accounted for approximately 40% ( 40 % ) of total wholesale revenues , with macy 2019s , inc .
representing approximately 20% ( 20 % ) of total wholesale revenues .
our product brands are sold primarily through our own sales forces .
our wholesale segment maintains its primary showrooms in new york city .
in addition , we maintain regional showrooms in chicago , dallas , milan , paris , london , munich , madrid , stockholm and tokyo .
shop-within-shops .
as a critical element of our distribution to department stores , we and our licensing partners utilize shop-within-shops to enhance brand recognition , to permit more complete merchandising of our lines by the department stores and to differentiate the presentation of products .
shop-within- shop fixed assets primarily include items such as customized freestanding fixtures , wall cases and components , decorative items and flooring .
as of march 31 , 2012 , we had approximately 18000 shop-within-shops dedicated to our ralph lauren-branded wholesale products worldwide .
the size of our shop-within-shops ranges from approximately 300 to 7400 square feet .
we normally share in the cost of building-out these shop-within-shops with our wholesale customers .
basic stock replenishment program .
basic products such as knit shirts , chino pants , oxford cloth shirts , and selected accessories ( including footwear ) and home products can be ordered at any time through our basic stock replenishment programs .
we generally ship these products within two-to-five days of order receipt .
our retail segment as of march 31 , 2012 , our retail segment consisted of 379 stores worldwide , totaling approximately 2.9 million gross square feet , 474 concessions- based shop-within-shops and six e-commerce websites .
the extension of our direct-to-consumer reach is a primary long-term strategic goal .
ralph lauren retail stores our ralph lauren retail stores reinforce the luxury image and distinct sensibility of our brands and feature exclusive lines that are not sold in domestic department stores .
we opened 10 new ralph lauren stores , acquired 3 previously licensed stores , and closed 16 ralph lauren stores in fiscal 2012 .
our retail stores are primarily situated in major upscale street locations and upscale regional malls , generally in large urban markets. |
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dd4c25860 | vornado realty trust 77 cash flows the company expects to contribute $ 959000 to the plans in 2004 .
11 .
leases as lessor : the company leases space to tenants under operating leases .
most of the leases provide for the payment of fixed base rentals payable monthly in advance .
shopping center leases provide for the pass-through to tenants of real estate taxes , insurance and maintenance .
office building leases generally require the tenants to reimburse the company for operating costs and real estate taxes above their base year costs .
shopping center leases also provide for the payment by the lessee of additional rent based on a percentage of the tenants 2019 sales .
as of december 31 , 2003 , future base rental revenue under non-cancelable operating leases , excluding rents for leases with an original term of less than one year and rents resulting from the exercise of renewal options , is as follows : ( amounts in thousands ) year ending december 31: .
2004 | $ 1084934
---------- | ---------
2005 | 968162
2006 | 846345
2007 | 770228
2008 | 608267
thereafter | 3423083
these amounts do not include rentals based on tenants 2019 sales .
these percentage rents approximated $ 3662000 , $ 1832000 , and $ 2157000 , for the years ended december 31 , 2003 , 2002 , and 2001 .
except for the u.s .
government , which accounted for 12.7% ( 12.7 % ) of the company 2019s revenue , none of the company 2019s tenants represented more than 10% ( 10 % ) of total revenues for the year ended december 31 , 2003 .
former bradlees locations property rentals for the year ended december 31 , 2003 , include $ 5000000 of additional rent which , effective december 31 , 2002 , was re-allocated to the former bradlees locations in marlton , turnersville , bensalem and broomall and is payable by stop & shop , pursuant to the master agreement and guaranty , dated may 1 , 1992 .
this amount is in addition to all other rent guaranteed by stop & shop for the former bradlees locations .
on january 8 , 2003 , stop & shop filed a complaint with the united states district court claiming the company has no right to reallocate and therefore continue to collect the $ 5000000 of annual rent from stop & shop because of the expiration of the east brunswick , jersey city , middletown , union and woodbridge leases to which the $ 5000000 of additional rent was previously allocated .
the company believes the additional rent provision of the guaranty expires at the earliest in 2012 and will vigorously oppose stop & shop 2019s complaint .
in february 2003 , koninklijke ahold nv , parent of stop & shop , announced that it overstated its 2002 and 2001 earnings by at least $ 500 million and is under investigation by the u.s .
justice department and securities and exchange commission .
the company cannot predict what effect , if any , this situation may have on stop & shop 2019s ability to satisfy its obligation under the bradlees guarantees and rent for existing stop & shop leases aggregating approximately $ 10.5 million per annum .
notes to consolidated financial statements sr-176_fin_l02p53_82v1.qxd 4/8/04 2:42 pm page 77 |
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dd4b9fab2 | 9 .
junior subordinated debt securities payable in accordance with the provisions of the junior subordinated debt securities which were issued on march 29 , 2004 , holdings elected to redeem the $ 329897 thousand of 6.2% ( 6.2 % ) junior subordinated debt securities outstanding on may 24 , 2013 .
as a result of the early redemption , the company incurred pre-tax expense of $ 7282 thousand related to the immediate amortization of the remaining capitalized issuance costs on the trust preferred securities .
interest expense incurred in connection with these junior subordinated debt securities is as follows for the periods indicated: .
( dollars in thousands ) | years ended december 31 , 2015 | years ended december 31 , 2014 | years ended december 31 , 2013
------------------------- | ------------------------------ | ------------------------------ | ------------------------------
interest expense incurred | $ - | $ - | $ 8181
holdings considered the mechanisms and obligations relating to the trust preferred securities , taken together , constituted a full and unconditional guarantee by holdings of capital trust ii 2019s payment obligations with respect to their trust preferred securities .
10 .
reinsurance and trust agreements certain subsidiaries of group have established trust agreements , which effectively use the company 2019s investments as collateral , as security for assumed losses payable to certain non-affiliated ceding companies .
at december 31 , 2015 , the total amount on deposit in trust accounts was $ 454384 thousand .
on april 24 , 2014 , the company entered into two collateralized reinsurance agreements with kilimanjaro re limited ( 201ckilimanjaro 201d ) , a bermuda based special purpose reinsurer , to provide the company with catastrophe reinsurance coverage .
these agreements are multi-year reinsurance contracts which cover specified named storm and earthquake events .
the first agreement provides up to $ 250000 thousand of reinsurance coverage from named storms in specified states of the southeastern united states .
the second agreement provides up to $ 200000 thousand of reinsurance coverage from named storms in specified states of the southeast , mid-atlantic and northeast regions of the united states and puerto rico as well as reinsurance coverage from earthquakes in specified states of the southeast , mid-atlantic , northeast and west regions of the united states , puerto rico and british columbia .
on november 18 , 2014 , the company entered into a collateralized reinsurance agreement with kilimanjaro re to provide the company with catastrophe reinsurance coverage .
this agreement is a multi-year reinsurance contract which covers specified earthquake events .
the agreement provides up to $ 500000 thousand of reinsurance coverage from earthquakes in the united states , puerto rico and canada .
on december 1 , 2015 the company entered into two collateralized reinsurance agreements with kilimanjaro re to provide the company with catastrophe reinsurance coverage .
these agreements are multi-year reinsurance contracts which cover named storm and earthquake events .
the first agreement provides up to $ 300000 thousand of reinsurance coverage from named storms and earthquakes in the united states , puerto rico and canada .
the second agreement provides up to $ 325000 thousand of reinsurance coverage from named storms and earthquakes in the united states , puerto rico and canada .
kilimanjaro has financed the various property catastrophe reinsurance coverage by issuing catastrophe bonds to unrelated , external investors .
on april 24 , 2014 , kilimanjaro issued $ 450000 thousand of notes ( 201cseries 2014-1 notes 201d ) .
on november 18 , 2014 , kilimanjaro issued $ 500000 thousand of notes ( 201cseries 2014-2 notes 201d ) .
on december 1 , 2015 , kilimanjaro issued $ 625000 thousand of notes ( 201cseries 2015-1 notes ) .
the proceeds from the issuance of the series 2014-1 notes , the series 2014-2 notes and the series 2015-1 notes are held in reinsurance trust throughout the duration of the applicable reinsurance agreements and invested solely in us government money market funds with a rating of at least 201caaam 201d by standard & poor 2019s. |
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dd4c65c30 | issuer purchases of equity securities during the three months ended december 31 , 2012 , we repurchased 619314 shares of our common stock for an aggregate of approximately $ 46.0 million , including commissions and fees , pursuant to our publicly announced stock repurchase program , as follows : period total number of shares purchased ( 1 ) average price paid per share ( 2 ) total number of shares purchased as part of publicly announced plans or programs approximate dollar value of shares that may yet be purchased under the plans or programs ( in millions ) .
period | total number of shares purchased ( 1 ) | average price paid per share ( 2 ) | total number of shares purchased as part of publicly announced plans orprograms | approximate dollar value of shares that may yet be purchased under the plans orprograms ( in millions )
-------------------- | -------------------------------------- | ---------------------------------- | ------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------
october 2012 | 27524 | $ 72.62 | 27524 | $ 1300.1
november 2012 | 489390 | $ 74.22 | 489390 | $ 1263.7
december 2012 | 102400 | $ 74.83 | 102400 | $ 1256.1
total fourth quarter | 619314 | $ 74.25 | 619314 | $ 1256.1
( 1 ) repurchases made pursuant to the $ 1.5 billion stock repurchase program approved by our board of directors in march 2011 ( the 201c2011 buyback 201d ) .
under this program , our management is authorized to purchase shares from time to time through open market purchases or privately negotiated transactions at prevailing prices as permitted by securities laws and other legal requirements , and subject to market conditions and other factors .
to facilitate repurchases , we make purchases pursuant to trading plans under rule 10b5-1 of the exchange act , which allows us to repurchase shares during periods when we otherwise might be prevented from doing so under insider trading laws or because of self-imposed trading blackout periods .
this program may be discontinued at any time .
( 2 ) average price per share is calculated using the aggregate price , excluding commissions and fees .
we continued to repurchase shares of our common stock pursuant to our 2011 buyback subsequent to december 31 , 2012 .
between january 1 , 2013 and january 21 , 2013 , we repurchased an additional 15790 shares of our common stock for an aggregate of $ 1.2 million , including commissions and fees , pursuant to the 2011 buyback .
as a result , as of january 21 , 2013 , we had repurchased a total of approximately 4.3 million shares of our common stock under the 2011 buyback for an aggregate of $ 245.2 million , including commissions and fees .
we expect to continue to manage the pacing of the remaining $ 1.3 billion under the 2011 buyback in response to general market conditions and other relevant factors. |
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dd4be50b2 | management 2019s discussion and analysis results of reportable business segments net sales segment income ( millions ) 2008 2007 2008 2007 .
( millions ) performance coatings | net sales 2008 $ 4716 | 2007 $ 3811 | segment income 2008 $ 582 | 2007 $ 563
--------------------------------- | --------------------- | ----------- | ------------------------- | ----------
industrial coatings | 3999 | 3646 | 212 | 370
architectural coatings 2013 emea | 2249 | 2014 | 141 | 2014
optical and specialty materials | 1134 | 1029 | 244 | 235
commodity chemicals | 1837 | 1539 | 340 | 243
glass | 1914 | 2195 | 70 | 138
performance coatings sales increased $ 905 million or 24% ( 24 % ) in 2008 .
sales increased 21% ( 21 % ) due to acquisitions , largely due to the impact of the sigmakalon protective and marine coatings business .
sales also grew by 3% ( 3 % ) due to higher selling prices and 2% ( 2 % ) due to the positive impact of foreign currency translation .
sales volumes declined 2% ( 2 % ) as reduced volumes in architectural coatings 2013 americas and asia pacific and automotive refinish were not fully offset by improved volumes in the aerospace and protective and marine businesses .
volume growth in the aerospace businesses occurred throughout the world , while the volume growth in protective and marine coatings occurred primarily in asia .
segment income increased $ 19 million in 2008 .
factors increasing segment income were the positive impact of acquisitions , lower overhead costs and the positive impact of foreign currency translation .
the benefit of higher selling prices more than offset the negative impact of inflation , including higher raw materials and benefit costs .
segment income was reduced by the impact of the lower sales volumes in architectural coatings and automotive refinish , which more than offset the benefit of volume gains in the aerospace and protective and marine coatings businesses .
industrial coatings sales increased $ 353 million or 10% ( 10 % ) in 2008 .
sales increased 11% ( 11 % ) due to acquisitions , including the impact of the sigmakalon industrial coatings business .
sales also grew 3% ( 3 % ) due to the positive impact of foreign currency translation , and 1% ( 1 % ) from higher selling prices .
sales volumes declined 5% ( 5 % ) as reduced volumes were experienced in all three businesses , reflecting the substantial declines in global demand .
volume declines in the automotive and industrial businesses were primarily in the u.s .
and canada .
additional volume declines in the european and asian regions were experienced by the industrial coatings business .
in packaging coatings , volume declines in europe were only partially offset by gains in asia and north america .
segment income declined $ 158 million in 2008 due to the lower volumes and inflation , including higher raw material and freight costs , the impact of which was only partially mitigated by the increased selling prices .
segment income also declined due to higher selling and distribution costs , including higher bad debt expense .
factors increasing segment income were the earnings of acquired businesses , the positive impact of foreign currency translation and lower manufacturing costs .
architectural coatings - emea sales for the year were $ 2249 million .
this business was acquired in the sigmakalon acquisition .
segment income was $ 141 million , which included amortization expense of $ 63 million related to acquired intangible assets and depreciation expense of $ 58 million .
optical and specialty materials sales increased $ 105 million or 10% ( 10 % ) in 2008 .
sales increased 5% ( 5 % ) due to higher volumes in our optical products business resulting from the launch of transitions optical 2019s next generation lens product , 3% ( 3 % ) due to the positive impact of foreign currency translation and 2% ( 2 % ) due to increased selling prices .
segment income increased $ 9 million in 2008 .
the increase in segment income was the result of increased sales volumes and the favorable impact of currency partially offset by increased selling and marketing costs in the optical products business related to the transitions optical product launch mentioned above .
increased selling prices only partially offset higher raw material costs , primarily in our silicas business .
commodity chemicals sales increased $ 298 million or 19% ( 19 % ) in 2008 .
sales increased 18% ( 18 % ) due to higher selling prices and 1% ( 1 % ) due to improved sales volumes .
segment income increased $ 97 million in 2008 .
segment income increased in large part due to higher selling prices , which more than offset the negative impact of inflation , primarily higher raw material and energy costs .
segment income also improved due to lower manufacturing costs , while lower margin mix and equity earnings reduced segment income .
glass sales decreased $ 281 million or 13% ( 13 % ) in 2008 .
sales decreased 11% ( 11 % ) due to the divestiture of the automotive glass and services business in september 2008 and 4% ( 4 % ) due to lower sales volumes .
sales increased 2% ( 2 % ) due to higher selling prices .
segment income decreased $ 68 million in 2008 .
segment income decreased due to the divestiture of the automotive glass and services business , lower volumes , the negative impact of inflation and lower equity earnings from our asian fiber glass joint ventures .
factors increasing segment income were lower manufacturing costs , higher selling prices and stronger foreign currency .
outlook overall global economic activity was volatile in 2008 with an overall downward trend .
the north american economy continued a slowing trend which began during the second half of 2006 and continued all of 2007 .
the impact of the weakening u.s .
economy was particularly 2008 ppg annual report and form 10-k 17 |
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dd4b971e6 | part ii , item 7 until maturity , effectively making this a us dollar denominated debt on which schlumberger will pay interest in us dollars at a rate of 4.74% ( 4.74 % ) .
the proceeds from these notes were used to repay commercial paper borrowings .
0160 on april 20 , 2006 , the schlumberger board of directors approved a share repurchase program of up to 40 million shares of common stock to be acquired in the open market before april 2010 , subject to market conditions .
this program was completed during the second quarter of 2008 .
on april 17 , 2008 , the schlumberger board of directors approved an $ 8 billion share repurchase program for shares of schlumberger common stock , to be acquired in the open market before december 31 , 2011 , of which $ 1.43 billion had been repurchased as of december 31 , 2009 .
the following table summarizes the activity under these share repurchase programs during 2009 , 2008 and ( stated in thousands except per share amounts and prices ) total cost of shares purchased total number of shares purchased average price paid per share .
| total cost of shares purchased | total number of shares purchased | average price paid per share
---- | ------------------------------ | -------------------------------- | ----------------------------
2009 | $ 500097 | 7825.0 | $ 63.91
2008 | $ 1818841 | 21064.7 | $ 86.35
2007 | $ 1355000 | 16336.1 | $ 82.95
0160 cash flow provided by operations was $ 5.3 billion in 2009 , $ 6.9 billion in 2008 and $ 6.3 billion in 2007 .
the decline in cash flow from operations in 2009 as compared to 2008 was primarily driven by the decrease in net income experienced in 2009 and the significant pension plan contributions made during 2009 , offset by an improvement in working capital requirements .
the improvement in 2008 as compared to 2007 was driven by the net income increase experienced in 2008 offset by required investments in working capital .
the reduction in cash flows experienced by some of schlumberger 2019s customers as a result of global economic conditions could have significant adverse effects on their financial condition .
this could result in , among other things , delay in , or nonpayment of , amounts that are owed to schlumberger , which could have a material adverse effect on schlumberger 2019s results of operations and cash flows .
at times in recent quarters , schlumberger has experienced delays in payments from certain of its customers .
schlumberger operates in approximately 80 countries .
at december 31 , 2009 , only three of those countries individually accounted for greater than 5% ( 5 % ) of schlumberger 2019s accounts receivable balance of which only one represented greater than 0160 during 2008 and 2007 , schlumberger announced that its board of directors had approved increases in the quarterly dividend of 20% ( 20 % ) and 40% ( 40 % ) , respectively .
total dividends paid during 2009 , 2008 and 2007 were $ 1.0 billion , $ 964 million and $ 771 million , respectively .
0160 capital expenditures were $ 2.4 billion in 2009 , $ 3.7 billion in 2008 and $ 2.9 billion in 2007 .
capital expenditures in 2008 and 2007 reflected the record activity levels experienced in those years .
the decrease in capital expenditures in 2009 as compared to 2008 is primarily due to the significant activity decline during 2009 .
oilfield services capital expenditures are expected to approach $ 2.4 billion for the full year 2010 as compared to $ 1.9 billion in 2009 and $ 3.0 billion in 2008 .
westerngeco capital expenditures are expected to approach $ 0.3 billion for the full year 2010 as compared to $ 0.5 billion in 2009 and $ 0.7 billion in 2008. |
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dd4c5739c | three-year period determined by reference to the ownership of persons holding five percent ( 5% ( 5 % ) ) or more of that company 2019s equity securities .
if a company undergoes an ownership change as defined by i.r.c .
section 382 , the company 2019s ability to utilize its pre-change nol carryforwards to offset post-change income may be limited .
the company believes that the limitation imposed by i.r.c .
section 382 generally should not preclude use of its federal nol carryforwards , assuming the company has sufficient taxable income in future carryforward periods to utilize those nol carryforwards .
the company 2019s federal nol carryforwards do not begin expiring until 2028 .
at december 31 , 2014 and 2013 , the company had state nols of $ 542705 and $ 628049 , respectively , a portion of which are offset by a valuation allowance because the company does not believe these nols are more likely than not to be realized .
the state nol carryforwards will expire between 2015 and 2033 .
at december 31 , 2014 and 2013 , the company had canadian nol carryforwards of $ 6498 and $ 6323 , respectively .
the majority of these carryforwards are offset by a valuation allowance because the company does not believe these nols are more likely than not to be realized .
the canadian nol carryforwards will expire between 2015 and 2033 .
the company had capital loss carryforwards for federal income tax purposes of $ 3844 at december 31 , 2014 and 2013 .
the company has recognized a full valuation allowance for the capital loss carryforwards because the company does not believe these losses are more likely than not to be recovered .
the company files income tax returns in the united states federal jurisdiction and various state and foreign jurisdictions .
with few exceptions , the company is no longer subject to u.s .
federal , state or local or non-u.s .
income tax examinations by tax authorities for years before 2008 .
for u.s .
federal , tax year 2011 is also closed .
the company has state income tax examinations in progress and does not expect material adjustments to result .
the patient protection and affordable care act ( the 201cppaca 201d ) became law on march 23 , 2010 , and the health care and education reconciliation act of 2010 became law on march 30 , 2010 , which makes various amendments to certain aspects of the ppaca ( together , the 201cacts 201d ) .
the ppaca effectively changes the tax treatment of federal subsidies paid to sponsors of retiree health benefit plans that provide a benefit that is at least actuarially equivalent to the benefits under medicare part d .
the acts effectively make the subsidy payments taxable in tax years beginning after december 31 , 2012 and as a result , the company followed its original accounting for the underfunded status of the other postretirement benefits for the medicare part d adjustment and recorded a reduction in deferred tax assets and an increase in its regulatory assets amounting to $ 6348 and $ 6241 at december 31 , 2014 and 2013 , respectively .
the following table summarizes the changes in the company 2019s gross liability , excluding interest and penalties , for unrecognized tax benefits: .
balance at january 1 2013 | $ 180993
------------------------------------------------------ | ----------------
increases in current period tax positions | 27229
decreases in prior period measurement of tax positions | -30275 ( 30275 )
balance at december 31 2013 | $ 177947
increases in current period tax positions | 53818
decreases in prior period measurement of tax positions | -36528 ( 36528 )
balance at december 31 2014 | $ 195237
the total balance in the table above does not include interest and penalties of $ 157 and $ 242 as of december 31 , 2014 and 2013 , respectively , which is recorded as a component of income tax expense .
the |
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dd4c51064 | value using an appropriate discount rate .
projected cash flow is discounted at a required rate of return that reflects the relative risk of achieving the cash flow and the time value of money .
the market approach is a valuation technique that uses prices and other relevant information generated by market transactions involving identical or comparable assets , liabilities , or a group of assets and liabilities .
valuation techniques consistent with the market approach often use market multiples derived from a set of comparables .
the cost approach , which estimates value by determining the current cost of replacing an asset with another of equivalent economic utility , was used , as appropriate , for property , plant and equipment .
the cost to replace a given asset reflects the estimated reproduction or replacement cost for the property , less an allowance for loss in value due to depreciation .
the preliminary purchase price allocation resulted in the recognition of $ 2.8 billion of goodwill , all of which is expected to be amortizable for tax purposes .
all of the goodwill was assigned to our mst business segment .
the goodwill recognized is attributable to expected revenue synergies generated by the integration of our products and technologies with those of sikorsky , costs synergies resulting from the consolidation or elimination of certain functions , and intangible assets that do not qualify for separate recognition , such as the assembled workforce of sikorsky .
determining the fair value of assets acquired and liabilities assumed requires the exercise of significant judgments , including the amount and timing of expected future cash flows , long-term growth rates and discount rates .
the cash flows employed in the dcf analyses are based on our best estimate of future sales , earnings and cash flows after considering factors such as general market conditions , customer budgets , existing firm orders , expected future orders , contracts with suppliers , labor agreements , changes in working capital , long term business plans and recent operating performance .
use of different estimates and judgments could yield different results .
impact to 2015 financial results sikorsky 2019s financial results have been included in our consolidated financial results only for the period from the november 6 , 2015 acquisition date through december 31 , 2015 .
as a result , our consolidated financial results for the year ended december 31 , 2015 do not reflect a full year of sikorsky 2019s results .
from the november 6 , 2015 acquisition date through december 31 , 2015 , sikorsky generated net sales of approximately $ 400 million and operating loss of approximately $ 45 million , inclusive of intangible amortization and adjustments required to account for the acquisition .
we incurred approximately $ 38 million of non-recoverable transaction costs associated with the sikorsky acquisition in 2015 that were expensed as incurred .
these costs are included in 201cother income , net 201d on our consolidated statements of earnings .
we also incurred approximately $ 48 million in costs associated with issuing the $ 7.0 billion november 2015 notes used to repay all outstanding borrowings under the 364-day facility used to finance the acquisition .
the financing costs were recorded as a reduction of debt and will be amortized to interest expense over the term of the related debt .
supplemental pro forma financial information ( unaudited ) the following table presents summarized unaudited pro forma financial information as if sikorsky had been included in our financial results for the entire years in 2015 and 2014 ( in millions ) : .
| 2015 | 2014
------------------------------------------------------------ | ------- | -------
net sales | $ 50962 | $ 53023
net earnings from continuing operations | 3538 | 3480
basic earnings per common share from continuing operations | 11.40 | 10.99
diluted earnings per common share from continuing operations | 11.24 | 10.79
the unaudited supplemental pro forma financial data above has been calculated after applying our accounting policies and adjusting the historical results of sikorsky with pro forma adjustments , net of tax , that assume the acquisition occurred on january 1 , 2014 .
significant pro forma adjustments include the recognition of additional amortization expense related to acquired intangible assets and additional interest expense related to the short-term debt used to finance the acquisition .
these adjustments assume the application of fair value adjustments to intangibles and the debt issuance occurred on january 1 , 2014 and are as follows : amortization expense of $ 125 million and $ 148 million in 2015 and 2014 , respectively ; and interest expense $ 42 million and $ 48 million in 2015 and 2014 , respectively .
in addition , significant nonrecurring adjustments include the elimination of a $ 72 million pension curtailment loss , net of tax , recognized in 2015 and the elimination of a $ 58 million income tax charge related to historic earnings of foreign subsidiaries recognized by sikorsky in 2015. |
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dd4c5029a | jpmorgan chase & co .
/ 2008 annual report 115 measure .
in the firm 2019s view , including these items in var produces a more complete perspective of the firm 2019s risk profile for items with market risk that can impact the income statement .
the consumer lending var includes the firm 2019s mortgage pipeline and warehouse loans , msrs and all related hedges .
the revised var measure continues to exclude the dva taken on derivative and structured liabilities to reflect the credit quality of the firm .
it also excludes certain nontrading activity such as private equity , principal investing ( e.g. , mezzanine financing , tax-oriented investments , etc. ) and corporate balance sheet and capital manage- ment positions , as well as longer-term corporate investments .
corporate positions are managed through the firm 2019s earnings-at-risk and other cash flow monitoring processes rather than by using a var measure .
nontrading principal investing activities and private equity positions are managed using stress and scenario analyses .
changing to the 95% ( 95 % ) confidence interval caused the average var to drop by $ 85 million in the third quarter when the new measure was implemented .
under the 95% ( 95 % ) confidence interval , the firm would expect to incur daily losses greater than those predicted by var esti- mates about twelve times a year .
the following table provides information about the sensitivity of dva to a one basis point increase in jpmorgan chase 2019s credit spreads .
the sensitivity of dva at december 31 , 2008 , represents the firm ( includ- ing bear stearns ) , while the sensitivity of dva for december 31 , 2007 , represents heritage jpmorgan chase only .
debit valuation adjustment sensitivity 1 basis point increase in ( in millions ) jpmorgan chase credit spread .
( in millions ) | 1 basis point increase in jpmorgan chase credit spread
---------------- | ------------------------------------------------------
december 31 2008 | $ 32
december 31 2007 | $ 38
loss advisories and drawdowns loss advisories and drawdowns are tools used to highlight to senior management trading losses above certain levels and initiate discus- sion of remedies .
economic value stress testing while var reflects the risk of loss due to adverse changes in normal markets , stress testing captures the firm 2019s exposure to unlikely but plausible events in abnormal markets .
the firm conducts economic value stress tests for both its trading and nontrading activities at least every two weeks using multiple scenarios that assume credit spreads widen significantly , equity prices decline and interest rates rise in the major currencies .
additional scenarios focus on the risks predominant in individual business segments and include scenarios that focus on the potential for adverse moves in complex portfolios .
periodically , scenarios are reviewed and updated to reflect changes in the firm 2019s risk profile and economic events .
along with var , stress testing is important in measuring and controlling risk .
stress testing enhances the understanding of the firm 2019s risk profile and loss poten- tial , and stress losses are monitored against limits .
stress testing is also utilized in one-off approvals and cross-business risk measure- ment , as well as an input to economic capital allocation .
stress-test results , trends and explanations are provided at least every two weeks to the firm 2019s senior management and to the lines of business to help them better measure and manage risks and understand event risk-sensitive positions .
earnings-at-risk stress testing the var and stress-test measures described above illustrate the total economic sensitivity of the firm 2019s balance sheet to changes in market variables .
the effect of interest rate exposure on reported net income is also important .
interest rate risk exposure in the firm 2019s core non- trading business activities ( i.e. , asset/liability management positions ) results from on- and off-balance sheet positions and can occur due to a variety of factors , including : 2022 differences in the timing among the maturity or repricing of assets , liabilities and off-balance sheet instruments .
for example , if liabilities reprice quicker than assets and funding interest rates are declining , earnings will increase initially .
2022 differences in the amounts of assets , liabilities and off-balance sheet instruments that are repricing at the same time .
for exam- ple , if more deposit liabilities are repricing than assets when gen- eral interest rates are declining , earnings will increase initially .
2022 differences in the amounts by which short-term and long-term market interest rates change .
for example , changes in the slope of the yield curve because the firm has the ability to lend at long-term fixed rates and borrow at variable or short-term fixed rates .
based upon these scenarios , the firm 2019s earnings would be affected negatively by a sudden and unanticipated increase in short-term rates paid on its liabilities ( e.g. , deposits ) without a corresponding increase in long-term rates received on its assets ( e.g. , loans ) .
conversely , higher long-term rates received on assets generally are beneficial to earnings , particularly when the increase is not accompanied by rising short-term rates paid on liabilities .
2022 the impact of changes in the maturity of various assets , liabilities or off-balance sheet instruments as interest rates change .
for example , if more borrowers than forecasted pay down higher rate loan balances when general interest rates are declining , earnings may decrease initially .
the firm manages interest rate exposure related to its assets and lia- bilities on a consolidated , corporate-wide basis .
business units trans- fer their interest rate risk to treasury through a transfer-pricing sys- tem , which takes into account the elements of interest rate exposure that can be risk-managed in financial markets .
these elements include asset and liability balances and contractual rates of interest , contractual principal payment schedules , expected prepayment expe- rience , interest rate reset dates and maturities , rate indices used for re-pricing , and any interest rate ceilings or floors for adjustable rate products .
all transfer-pricing assumptions are dynamically reviewed .
the firm conducts simulations of changes in net interest income from its nontrading activities under a variety of interest rate scenar- ios .
earnings-at-risk tests measure the potential change in the firm 2019s net interest income , and the corresponding impact to the firm 2019s pre- |
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dd4ba8a5e | risks relating to our business fluctuations in the financial markets could result in investment losses .
prolonged and severe disruptions in the overall public debt and equity markets , such as occurred during 2008 , could result in significant realized and unrealized losses in our investment portfolio .
although financial markets have significantly improved since 2008 , they could deteriorate in the future .
there could also be disruption in individual market sectors , such as occurred in the energy sector in recent years .
such declines in the financial markets could result in significant realized and unrealized losses on investments and could have a material adverse impact on our results of operations , equity , business and insurer financial strength and debt ratings .
our results could be adversely affected by catastrophic events .
we are exposed to unpredictable catastrophic events , including weather-related and other natural catastrophes , as well as acts of terrorism .
any material reduction in our operating results caused by the occurrence of one or more catastrophes could inhibit our ability to pay dividends or to meet our interest and principal payment obligations .
by way of illustration , during the past five calendar years , pre-tax catastrophe losses , net of contract specific reinsurance but before cessions under corporate reinsurance programs , were as follows: .
calendar year: | pre-tax catastrophe losses
----------------------- | --------------------------
( dollars in millions ) |
2016 | $ 301.2
2015 | 53.8
2014 | 56.3
2013 | 194.0
2012 | 410.0
our losses from future catastrophic events could exceed our projections .
we use projections of possible losses from future catastrophic events of varying types and magnitudes as a strategic underwriting tool .
we use these loss projections to estimate our potential catastrophe losses in certain geographic areas and decide on the placement of retrocessional coverage or other actions to limit the extent of potential losses in a given geographic area .
these loss projections are approximations , reliant on a mix of quantitative and qualitative processes , and actual losses may exceed the projections by a material amount , resulting in a material adverse effect on our financial condition and results of operations. |
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dd4b918b8 | state street corporation notes to consolidated financial statements ( continued ) with respect to the 5.25% ( 5.25 % ) subordinated bank notes due 2018 , state street bank is required to make semi- annual interest payments on the outstanding principal balance of the notes on april 15 and october 15 of each year , and the notes qualify for inclusion in tier 2 regulatory capital under current federal regulatory capital guidelines .
with respect to the 5.30% ( 5.30 % ) subordinated notes due 2016 and the floating-rate subordinated notes due 2015 , state street bank is required to make semi-annual interest payments on the outstanding principal balance of the 5.30% ( 5.30 % ) subordinated notes on january 15 and july 15 of each year , and quarterly interest payments on the outstanding principal balance of the floating-rate notes on march 8 , june 8 , september 8 and december 8 of each year .
each of the subordinated notes qualifies for inclusion in tier 2 regulatory capital under current federal regulatory capital guidelines .
note 11 .
commitments , guarantees and contingencies commitments : we had unfunded off-balance sheet commitments to extend credit totaling $ 21.30 billion and $ 17.86 billion as of december 31 , 2013 and 2012 , respectively .
the potential losses associated with these commitments equal the gross contractual amounts , and do not consider the value of any collateral .
approximately 75% ( 75 % ) of our unfunded commitments to extend credit expire within one year from the date of issue .
since many of these commitments are expected to expire or renew without being drawn upon , the gross contractual amounts do not necessarily represent our future cash requirements .
guarantees : off-balance sheet guarantees are composed of indemnified securities financing , stable value protection , unfunded commitments to purchase assets , and standby letters of credit .
the potential losses associated with these guarantees equal the gross contractual amounts , and do not consider the value of any collateral .
the following table presents the aggregate gross contractual amounts of our off-balance sheet guarantees as of december 31 , 2013 and 2012 .
amounts presented do not reflect participations to independent third parties. .
( in millions ) | 2013 | 2012
-------------------------------- | -------- | --------
indemnified securities financing | $ 320078 | $ 302341
stable value protection | 24906 | 33512
asset purchase agreements | 4685 | 5063
standby letters of credit | 4612 | 4552
indemnified securities financing on behalf of our clients , we lend their securities , as agent , to brokers and other institutions .
in most circumstances , we indemnify our clients for the fair market value of those securities against a failure of the borrower to return such securities .
we require the borrowers to maintain collateral in an amount equal to or in excess of 100% ( 100 % ) of the fair market value of the securities borrowed .
securities on loan and the collateral are revalued daily to determine if additional collateral is necessary or if excess collateral is required to be returned to the borrower .
collateral received in connection with our securities lending services is held by us as agent and is not recorded in our consolidated statement of condition .
the cash collateral held by us as agent is invested on behalf of our clients .
in certain cases , the cash collateral is invested in third-party repurchase agreements , for which we indemnify the client against loss of the principal invested .
we require the counterparty to the indemnified repurchase agreement to provide collateral in an amount equal to or in excess of 100% ( 100 % ) of the amount of the repurchase agreement .
in our role as agent , the indemnified repurchase agreements and the related collateral held by us are not recorded in our consolidated statement of condition. |
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dd4970e26 | republic services , inc .
notes to consolidated financial statements 2014 ( continued ) 16 .
financial instruments fuel hedges we have entered into multiple swap agreements designated as cash flow hedges to mitigate some of our exposure related to changes in diesel fuel prices .
these swaps qualified for , and were designated as , effective hedges of changes in the prices of forecasted diesel fuel purchases ( fuel hedges ) .
the following table summarizes our outstanding fuel hedges as of december 31 , 2015 : year gallons hedged weighted average contract price per gallon .
year | gallons hedged | weighted average contractprice per gallon
---- | -------------- | -----------------------------------------
2016 | 27000000 | $ 3.57
2017 | 12000000 | 2.92
if the national u.s .
on-highway average price for a gallon of diesel fuel as published by the department of energy exceeds the contract price per gallon , we receive the difference between the average price and the contract price ( multiplied by the notional gallons ) from the counterparty .
if the average price is less than the contract price per gallon , we pay the difference to the counterparty .
the fair values of our fuel hedges are determined using standard option valuation models with assumptions about commodity prices based on those observed in underlying markets ( level 2 in the fair value hierarchy ) .
the aggregate fair values of our outstanding fuel hedges as of december 31 , 2015 and 2014 were current liabilities of $ 37.8 million and $ 34.4 million , respectively , and have been recorded in other accrued liabilities in our consolidated balance sheets .
the ineffective portions of the changes in fair values resulted in a loss of $ 0.4 million and $ 0.5 million for the years ended december 31 , 2015 and 2014 respectively , and a gain of less than $ 0.1 million for the year ended december 31 , 2013 , and have been recorded in other income , net in our consolidated statements of income .
total ( loss ) gain recognized in other comprehensive ( loss ) income for fuel hedges ( the effective portion ) was $ ( 2.0 ) million , $ ( 24.2 ) million and $ 2.4 million , for the years ended december 31 , 2015 , 2014 and 2013 , respectively .
recycling commodity hedges revenue from the sale of recycled commodities is primarily from sales of old corrugated cardboard and old newspaper .
from time to time we use derivative instruments such as swaps and costless collars designated as cash flow hedges to manage our exposure to changes in prices of these commodities .
we had no outstanding recycling commodity hedges as of december 31 , 2015 and 2014 .
no amounts were recognized in other income , net in our consolidated statements of income for the ineffective portion of the changes in fair values during the years ended december 31 , 2015 , 2014 and 2013 .
total gain ( loss ) recognized in other comprehensive income for recycling commodity hedges ( the effective portion ) was $ 0.1 million and $ ( 0.1 ) million for the years ended december 31 , 2014 and 2013 , respectively .
no amount was recognized in other comprehensive income for 2015 .
fair value measurements in measuring fair values of assets and liabilities , we use valuation techniques that maximize the use of observable inputs ( level 1 ) and minimize the use of unobservable inputs ( level 3 ) .
we also use market data or assumptions that we believe market participants would use in pricing an asset or liability , including assumptions about risk when appropriate. |
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dd4b926f0 | s c h e d u l e i v ( continued ) ace limited and subsidiaries s u p p l e m e n t a l i n f o r m a t i o n c o n c e r n i n g r e i n s u r a n c e premiums earned for the years ended december 31 , 2008 , 2007 , and 2006 ( in millions of u.s .
dollars ) direct amount ceded to companies assumed from other companies net amount percentage of amount assumed to .
for the years ended december 31 2008 2007 and 2006 ( in millions of u.s . dollars ) | direct amount | ceded to other companies | assumed from other companies | net amount | percentage of amount assumed to net
----------------------------------------------------------------------------------- | ------------- | ------------------------ | ---------------------------- | ---------- | -----------------------------------
2008 | $ 16087 | $ 6144 | $ 3260 | $ 13203 | 25% ( 25 % )
2007 | $ 14673 | $ 5834 | $ 3458 | $ 12297 | 28% ( 28 % )
2006 | $ 13562 | $ 5198 | $ 3461 | $ 11825 | 29% ( 29 % ) |
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dd4bd2142 | kimco realty corporation and subsidiaries notes to consolidated financial statements , continued uncertain tax positions : the company is subject to income tax in certain jurisdictions outside the u.s. , principally canada and mexico .
the statute of limitations on assessment of tax varies from three to seven years depending on the jurisdiction and tax issue .
tax returns filed in each jurisdiction are subject to examination by local tax authorities .
the company is currently under audit by the canadian revenue agency , mexican tax authority and the u.s .
internal revenue service ( 201cirs 201d ) .
in october 2011 , the irs issued a notice of proposed adjustment , which proposes pursuant to section 482 of the code , to disallow a capital loss claimed by krs on the disposition of common shares of valad property ltd. , an australian publicly listed company .
because the adjustment is being made pursuant to section 482 of the code , the irs believes it can assert a 100 percent 201cpenalty 201d tax pursuant to section 857 ( b ) ( 7 ) of the code and disallow the capital loss deduction .
the notice of proposed adjustment indicates the irs 2019 intention to impose the 100 percent 201cpenalty 201d tax on the company in the amount of $ 40.9 million and disallowing the capital loss claimed by krs .
the company and its outside counsel have considered the irs 2019 assessment and believe that there is sufficient documentation establishing a valid business purpose for the transfer , including recent case history showing support for similar positions .
accordingly , the company strongly disagrees with the irs 2019 position on the application of section 482 of the code to the disposition of the shares , the imposition of the 100 percent penalty tax and the simultaneous assertion of the penalty tax and disallowance of the capital loss deduction .
the company received a notice of proposed assessment and filed a written protest and requested an irs appeals office conference .
an appeals hearing was attended by management and its attorneys , the irs compliance group and an irs appeals officer in november , 2014 , at which time irs compliance presented arguments in support of their position , as noted herein .
management and its attorneys presented rebuttal arguments in support of its position .
the matter is currently under consideration by the appeals officer .
the company intends to vigorously defend its position in this matter and believes it will prevail .
resolutions of these audits are not expected to have a material effect on the company 2019s financial statements .
during 2013 , the company early adopted asu 2013-11 prospectively and reclassified a portion of its reserve for uncertain tax positions .
the reserve for uncertain tax positions included amounts related to the company 2019s canadian operations .
the company has unrecognized tax benefits reported as deferred tax assets and are available to settle adjustments made with respect to the company 2019s uncertain tax positions in canada .
the company reduced its reserve for uncertain tax positions by $ 12.3 million associated with its canadian operations and reduced its deferred tax assets in accordance with asu 2013-11 .
the company does not believe that the total amount of unrecognized tax benefits as of december 31 , 2014 , will significantly increase or decrease within the next 12 months .
as of december 31 , 2014 , the company 2019s canadian uncertain tax positions , which reduce its deferred tax assets , aggregated $ 10.4 million .
the liability for uncertain tax benefits principally consists of estimated foreign , federal and state income tax liabilities in years for which the statute of limitations is open .
open years range from 2008 through 2014 and vary by jurisdiction and issue .
the aggregate changes in the balance of unrecognized tax benefits for the years ended december 31 , 2014 and 2013 were as follows ( in thousands ) : .
| 201 4 | 2013
--------------------------------------------------- | ------ | ----------------
balance beginning of year | $ 4590 | $ 16890
increases for tax positions related to current year | 59 | 15
reduction due to adoption of asu 2013-11 ( a ) | - | -12315 ( 12315 )
balance end of year | $ 4649 | $ 4590
( a ) this amount was reclassified against the related deferred tax asset relating to the company 2019s early adoption of asu 2013-11 as discussed above. |
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dd4bae31e | american tower corporation and subsidiaries notes to consolidated financial statements 2014 ( continued ) from december 1 through may 31 of each year .
during the 2008 , 2007 and 2006 offering periods employees purchased 55764 , 48886 and 53210 shares , respectively , at weighted average prices per share of $ 30.08 , $ 33.93 and $ 24.98 , respectively .
the fair value of the espp offerings is estimated on the offering period commencement date using a black-scholes pricing model with the expense recognized over the expected life , which is the six month offering period over which employees accumulate payroll deductions to purchase the company 2019s common stock .
the weighted average fair value for the espp shares purchased during 2008 , 2007 and 2006 were $ 7.89 , $ 9.09 and $ 6.79 , respectively .
at december 31 , 2008 , 8.8 million shares remain reserved for future issuance under the plan .
key assumptions used to apply this pricing model for the years ended december 31 , are as follows: .
| 2008 | 2007 | 2006
-------------------------------------------------------------- | --------------------------------------------- | --------------------------------------------- | -----------------------------------------
range of risk free interest rates | 1.99% ( 1.99 % ) 20143.28% ( 20143.28 % ) | 4.98% ( 4.98 % ) 20145.05% ( 20145.05 % ) | 5.01% ( 5.01 % ) 20145.17% ( 20145.17 % )
weighted average risk-free interest rate | 2.58% ( 2.58 % ) | 5.02% ( 5.02 % ) | 5.08% ( 5.08 % )
expected life of the shares | 6 months | 6 months | 6 months
range of expected volatility of underlying stock price | 27.85% ( 27.85 % ) 201428.51% ( 201428.51 % ) | 27.53% ( 27.53 % ) 201428.74% ( 201428.74 % ) | 29.60% ( 29.60 % )
weighted average expected volatility of underlying stock price | 28.51% ( 28.51 % ) | 28.22% ( 28.22 % ) | 29.60% ( 29.60 % )
expected annual dividends | n/a | n/a | n/a
13 .
stockholders 2019 equity warrants 2014in january 2003 , the company issued warrants to purchase approximately 11.4 million shares of its common stock in connection with an offering of 808000 units , each consisting of $ 1000 principal amount at maturity of ati 12.25% ( 12.25 % ) senior subordinated discount notes due 2008 and a warrant to purchase 14.0953 shares of the company 2019s common stock .
these warrants became exercisable on january 29 , 2006 at an exercise price of $ 0.01 per share .
as these warrants expired on august 1 , 2008 , none were outstanding as of december 31 , in august 2005 , the company completed its merger with spectrasite , inc .
and assumed outstanding warrants to purchase shares of spectrasite , inc .
common stock .
as of the merger completion date , each warrant was exercisable for two shares of spectrasite , inc .
common stock at an exercise price of $ 32 per warrant .
upon completion of the merger , each warrant to purchase shares of spectrasite , inc .
common stock automatically converted into a warrant to purchase shares of the company 2019s common stock , such that upon exercise of each warrant , the holder has a right to receive 3.575 shares of the company 2019s common stock in lieu of each share of spectrasite , inc .
common stock that would have been receivable under each assumed warrant prior to the merger .
upon completion of the company 2019s merger with spectrasite , inc. , these warrants were exercisable for approximately 6.8 million shares of common stock .
of these warrants , warrants to purchase approximately 1.8 million and 2.0 million shares of common stock remained outstanding as of december 31 , 2008 and 2007 , respectively .
these warrants will expire on february 10 , 2010 .
stock repurchase programs 2014during the year ended december 31 , 2008 , the company repurchased an aggregate of approximately 18.3 million shares of its common stock for an aggregate of $ 697.1 million , including commissions and fees , pursuant to its publicly announced stock repurchase programs , as described below. |
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dd4badfea | consolidated 2005 results of operations was an estimated reduction of gross profit and a corresponding decrease to inventory , at cost , of $ 5.2 million .
store pre-opening costs pre-opening costs related to new store openings and the construction periods are expensed as incurred .
property and equipment property and equipment are recorded at cost .
the company provides for depreciation and amortization on a straight-line basis over the following estimated useful lives: .
land improvements | 20
-------------------------------- | -----
buildings | 39-40
furniture fixtures and equipment | 3-10
improvements of leased properties are amortized over the shorter of the life of the applicable lease term or the estimated useful life of the asset .
impairment of long-lived assets when indicators of impairment are present , the company evaluates the carrying value of long-lived assets , other than goodwill , in relation to the operating performance and future cash flows or the appraised values of the underlying assets .
in accordance with sfas 144 , 201caccounting for the impairment or disposal of long-lived assets , 201d the company reviews for impairment stores open more than two years for which current cash flows from operations are negative .
impairment results when the carrying value of the assets exceeds the undiscounted future cash flows over the life of the lease .
the company 2019s estimate of undiscounted future cash flows over the lease term is based upon historical operations of the stores and estimates of future store profitability which encompasses many factors that are subject to variability and difficult to predict .
if a long-lived asset is found to be impaired , the amount recognized for impairment is equal to the difference between the carrying value and the asset 2019s fair value .
the fair value is estimated based primarily upon future cash flows ( discounted at the company 2019s credit adjusted risk-free rate ) or other reasonable estimates of fair market value .
assets to be disposed of are adjusted to the fair value less the cost to sell if less than the book value .
the company recorded impairment charges , included in sg&a expense , of approximately $ 9.4 million in 2006 , $ 0.6 million in 2005 and $ 0.2 million in 2004 to reduce the carrying value of certain of its stores 2019 assets as deemed necessary due to negative sales trends and cash flows at these locations .
the majority of the 2006 charges were recorded pursuant to certain strategic initiatives discussed in note 2 .
other assets other assets consist primarily of long-term investments , qualifying prepaid expenses , debt issuance costs which are amortized over the life of the related obligations , utility and security deposits , life insurance policies and goodwill. |
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dd4b95daa | the company granted 1020 performance shares .
the vesting of these shares is contingent on meeting stated goals over a performance period .
beginning with restricted stock grants in september 2010 , dividends are accrued on restricted class a common stock and restricted stock units and are paid once the restricted stock vests .
the following table summarizes restricted stock and performance shares activity for 2010 : number of shares weighted average grant date fair value .
| number of shares | weighted average grant date fair value
------------------------------- | ---------------- | --------------------------------------
outstanding at december 31 2009 | 116677 | $ 280
granted | 134245 | 275
vested | -34630 ( 34630 ) | 257
cancelled | -19830 ( 19830 ) | 260
outstanding at december 31 2010 | 196462 | 283
the total fair value of restricted stock that vested during the years ended december 31 , 2010 , 2009 and 2008 , was $ 10.3 million , $ 6.2 million and $ 2.5 million , respectively .
eligible employees may acquire shares of cme group 2019s class a common stock using after-tax payroll deductions made during consecutive offering periods of approximately six months in duration .
shares are purchased at the end of each offering period at a price of 90% ( 90 % ) of the closing price of the class a common stock as reported on the nasdaq .
compensation expense is recognized on the dates of purchase for the discount from the closing price .
in 2010 , 2009 and 2008 , a total of 4371 , 4402 and 5600 shares , respectively , of class a common stock were issued to participating employees .
these shares are subject to a six-month holding period .
annual expense of $ 0.1 million for the purchase discount was recognized in 2010 , 2009 and 2008 , respectively .
non-executive directors receive an annual award of class a common stock with a value equal to $ 75000 .
non-executive directors may also elect to receive some or all of the cash portion of their annual stipend , up to $ 25000 , in shares of stock based on the closing price at the date of distribution .
as a result , 7470 , 11674 and 5509 shares of class a common stock were issued to non-executive directors during 2010 , 2009 and 2008 , respectively .
these shares are not subject to any vesting restrictions .
expense of $ 2.4 million , $ 2.5 million and $ 2.4 million related to these stock-based payments was recognized for the years ended december 31 , 2010 , 2009 and 2008 , respectively. |
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dd4bb0bb4 | apple inc .
| 2016 form 10-k | 20 company stock performance the following graph shows a comparison of cumulative total shareholder return , calculated on a dividend reinvested basis , for the company , the s&p 500 index , the s&p information technology index and the dow jones u.s .
technology supersector index for the five years ended september 24 , 2016 .
the graph assumes $ 100 was invested in each of the company 2019s common stock , the s&p 500 index , the s&p information technology index and the dow jones u.s .
technology supersector index as of the market close on september 23 , 2011 .
note that historic stock price performance is not necessarily indicative of future stock price performance .
* $ 100 invested on 9/23/11 in stock or index , including reinvestment of dividends .
data points are the last day of each fiscal year for the company 2019s common stock and september 30th for indexes .
copyright a9 2016 s&p , a division of mcgraw hill financial .
all rights reserved .
copyright a9 2016 dow jones & co .
all rights reserved .
september september september september september september .
| september2011 | september2012 | september2013 | september2014 | september2015 | september2016
-------------------------------------------- | ------------- | ------------- | ------------- | ------------- | ------------- | -------------
apple inc . | $ 100 | $ 166 | $ 123 | $ 183 | $ 212 | $ 213
s&p 500 index | $ 100 | $ 130 | $ 155 | $ 186 | $ 185 | $ 213
s&p information technology index | $ 100 | $ 132 | $ 142 | $ 183 | $ 187 | $ 230
dow jones u.s . technology supersector index | $ 100 | $ 130 | $ 137 | $ 178 | $ 177 | $ 217 |
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dd4b95fc6 | news corporation notes to the consolidated financial statements consideration over the fair value of the net tangible and intangible assets acquired was recorded as goodwill .
the allocation is as follows ( in millions ) : assets acquired: .
intangible assets | $ 220
------------------------- | ----------
goodwill | 115
net liabilities | -50 ( 50 )
total net assets acquired | $ 285
the acquired intangible assets primarily relate to broadcast licenses , which have a fair value of approximately $ 185 million , tradenames , which have a fair value of approximately $ 27 million , and customer relationships with a fair value of approximately $ 8 million .
the broadcast licenses and tradenames have indefinite lives and the customer relationships are being amortized over a weighted-average useful life of approximately 6 years .
wireless group 2019s results are included within the news and information services segment , and it is considered a separate reporting unit for purposes of the company 2019s annual goodwill impairment review .
rea group european business in december 2016 , rea group , in which the company holds a 61.6% ( 61.6 % ) interest , sold its european business for approximately $ 140 million ( approximately 20ac133 million ) in cash , which resulted in a pre-tax gain of $ 107 million for the fiscal year ended june 30 , 2017 .
the sale allows rea group to focus on its core businesses in australia and asia .
in addition to the acquisitions noted above and the investments referenced in note 6 2014investments , the company used $ 62 million of cash for additional acquisitions during fiscal 2017 , primarily consisting of australian regional media ( 201carm 201d ) .
arm 2019s results are included within the news and information services segment .
note 5 .
restructuring programs the company recorded restructuring charges of $ 92 million , $ 71 million and $ 142 million for the fiscal years ended june 30 , 2019 , 2018 and 2017 , respectively , of which $ 77 million , $ 58 million and $ 133 million related to the news and information services segment , respectively .
the restructuring charges recorded in fiscal 2019 , 2018 and 2017 were primarily for employee termination benefits. |
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dd4b8d65a | entergy corporation and subsidiaries management's financial discussion and analysis 2022 the deferral in august 2004 of $ 7.5 million of fossil plant maintenance and voluntary severance program costs at entergy new orleans as a result of a stipulation approved by the city council .
2003 compared to 2002 net revenue , which is entergy's measure of gross margin , consists of operating revenues net of : 1 ) fuel , fuel-related , and purchased power expenses and 2 ) other regulatory credits .
following is an analysis of the change in net revenue comparing 2003 to 2002. .
| ( in millions )
------------------------------------- | ----------------
2002 net revenue | $ 4209.6
base rate increases | 66.2
base rate decreases | -23.3 ( 23.3 )
deferred fuel cost revisions | 56.2
asset retirement obligation | 42.9
net wholesale revenue | 23.2
march 2002 ark . settlement agreement | -154.0 ( 154.0 )
other | -6.3 ( 6.3 )
2003 net revenue | $ 4214.5
base rates increased net revenue due to base rate increases at entergy mississippi and entergy new orleans that became effective in january 2003 and june 2003 , respectively .
entergy gulf states implemented base rate decreases in its louisiana jurisdiction effective june 2002 and january 2003 .
the january 2003 base rate decrease of $ 22.1 million had a minimal impact on net income due to a corresponding reduction in nuclear depreciation and decommissioning expenses associated with the change in accounting estimate to reflect an assumed extension of river bend's useful life .
the deferred fuel cost revisions variance was due to a revised unbilled sales pricing estimate made in december 2002 and further revision of that estimate in the first quarter of 2003 to more closely align the fuel component of that pricing with expected recoverable fuel costs at entergy louisiana .
the asset retirement obligation variance was due to the implementation of sfas 143 , "accounting for asset retirement obligations" adopted in january 2003 .
see "critical accounting estimates 2013 nuclear decommissioning costs" for more details on sfas 143 .
the increase was offset by increased depreciation and decommissioning expenses and had an insignificant effect on net income .
the increase in net wholesale revenue was primarily due to an increase in sales volume to municipal and cooperative customers .
the march 2002 settlement agreement variance reflects the absence in 2003 of the effect of recording the ice storm settlement approved by the apsc in 2002 .
this settlement resulted in previously deferred revenues at entergy arkansas per the transition cost account mechanism being recorded in net revenue in the second quarter of 2002 .
the decrease was offset by a corresponding decrease in other operation and maintenance expenses and had a minimal effect on net income .
gross operating revenues and regulatory credits gross operating revenues include an increase in fuel cost recovery revenues of $ 682 million and $ 53 million in electric and gas sales , respectively , primarily due to higher fuel rates in 2003 resulting from increases in the market prices of purchased power and natural gas .
as such , this revenue increase was offset by increased fuel and purchased power expenses. |
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dd4ba8c48 | humana inc .
notes to consolidated financial statements 2014 ( continued ) the grant-date fair value of the award will be estimated using option-pricing models .
in addition , certain tax effects of stock option exercises will be reported as a financing activity rather than an operating activity in the statements of cash flows .
we adopted sfas 123r on january 1 , 2006 under the retrospective transition method using the black-scholes pricing model .
the effect of expensing stock options under a fair value approach using the black-scholes pricing model on diluted earnings per common share for the years ended december 31 , 2005 , 2004 and 2003 is disclosed on page 69 .
in addition , the classification of cash inflows from any excess tax benefit associated with exercising stock options will change from an operating activity to a financing activity in the consolidated statements of cash flows with no impact on total cash flows .
we estimate the impact of this change in classification will decrease operating cash flows ( and increase financing cash flows ) by approximately $ 15.5 million in 2005 , $ 3.7 million in 2004 , and $ 15.2 million in 2003 .
stock option expense after adopting sfas 123r is not expected to be materially different than our pro forma disclosure on page 69 and is dependent on levels of stock options granted during 2006 .
3 .
acquisitions in january 2006 , our commercial segment reached an agreement to acquire cha service company , or cha health , a health plan serving employer groups in kentucky , for cash consideration of approximately $ 60.0 million plus any excess statutory surplus .
this transaction , which is subject to regulatory approval , is expected to close effective in the second quarter of 2006 .
on december 20 , 2005 , our commercial segment acquired corphealth , inc. , or corphealth , a behavioral health care management company , for cash consideration of approximately $ 54.2 million , including transaction costs .
this acquisition allows humana to integrate coverage of medical and behavior health benefits .
net tangible assets acquired of $ 6.0 million primarily consisted of cash and cash equivalents .
the purchase price exceeded the estimated fair value of the net tangible assets acquired by approximately $ 48.2 million .
we preliminarily allocated this excess purchase price to other intangible assets of $ 8.6 million and associated deferred tax liabilities of $ 3.2 million , and non-deductible goodwill of $ 42.8 million .
the other intangible assets , which consist primarily of customer contracts , have a weighted average useful life of 14.7 years .
the allocation is subject to change pending completion of the valuation by a third party valuation specialist firm assisting us in evaluating the fair value of the assets acquired .
on february 16 , 2005 , our government segment acquired careplus health plans of florida , or careplus , as well as its affiliated 10 medical centers and pharmacy company .
careplus provides medicare advantage hmo plans and benefits to medicare advantage members in miami-dade , broward and palm beach counties .
this acquisition enhances our medicare market position in south florida .
we paid approximately $ 444.9 million in cash , including transaction costs .
we financed the transaction with $ 294.0 million of borrowings under our credit agreement and $ 150.9 million of cash on hand .
the purchase price is subject to a balance sheet settlement process with a nine month claims run-out period .
this settlement , which will be reflected as an adjustment to goodwill , is not expected to be material .
the fair value of the acquired tangible assets ( assumed liabilities ) consisted of the following: .
| ( in thousands )
-------------------------------------------- | ----------------
cash and cash equivalents | $ 92116
premiums receivable and other current assets | 6510
property and equipment and other assets | 21315
medical and other expenses payable | -37375 ( 37375 )
other current liabilities | -23359 ( 23359 )
other liabilities | -5915 ( 5915 )
net tangible assets acquired | $ 53292 |
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dd4bb4980 | page 71 of 94 notes to consolidated financial statements ball corporation and subsidiaries 16 .
shareholders 2019 equity ( continued ) on october 24 , 2007 , ball announced the discontinuance of the company 2019s discount on the reinvestment of dividends associated with the company 2019s dividend reinvestment and voluntary stock purchase plan for non- employee shareholders .
the 5 percent discount was discontinued on november 1 , 2007 .
accumulated other comprehensive earnings ( loss ) the activity related to accumulated other comprehensive earnings ( loss ) was as follows : ( $ in millions ) foreign currency translation pension and postretirement items , net of tax effective financial derivatives , net of tax accumulated comprehensive earnings ( loss ) .
( $ in millions ) | foreign currency translation | pension and other postretirement items net of tax | effective financial derivatives net of tax | accumulated other comprehensive earnings ( loss )
-------------------------------------- | ---------------------------- | ------------------------------------------------- | ------------------------------------------ | -------------------------------------------------
december 31 2004 | $ 148.9 | $ -126.3 ( 126.3 ) | $ 10.6 | $ 33.2
2005 change | -74.3 ( 74.3 ) | -43.6 ( 43.6 ) | -16.0 ( 16.0 ) | -133.9 ( 133.9 )
december 31 2005 | 74.6 | -169.9 ( 169.9 ) | -5.4 ( 5.4 ) | -100.7 ( 100.7 )
2006 change | 57.2 | 55.9 | 6.0 | 119.1
effect of sfas no . 158 adoption ( a ) | 2013 | -47.9 ( 47.9 ) | 2013 | -47.9 ( 47.9 )
december 31 2006 | 131.8 | -161.9 ( 161.9 ) | 0.6 | -29.5 ( 29.5 )
2007 change | 90.0 | 57.9 | -11.5 ( 11.5 ) | 136.4
december 31 2007 | $ 221.8 | $ -104.0 ( 104.0 ) | $ -10.9 ( 10.9 ) | $ 106.9
( a ) within the company 2019s 2006 annual report , the consolidated statement of changes in shareholders 2019 equity for the year ended december 31 , 2006 , included a transition adjustment of $ 47.9 million , net of tax , related to the adoption of sfas no .
158 , 201cemployers 2019 accounting for defined benefit pension plans and other postretirement plans , an amendment of fasb statements no .
87 , 88 , 106 and 132 ( r ) , 201d as a component of 2006 comprehensive earnings rather than only as an adjustment to accumulated other comprehensive loss .
the 2006 amounts have been revised to correct the previous reporting .
notwithstanding the 2005 distribution pursuant to the jobs act , management 2019s intention is to indefinitely reinvest foreign earnings .
therefore , no taxes have been provided on the foreign currency translation component for any period .
the change in the pension and other postretirement items is presented net of related tax expense of $ 31.3 million and $ 2.9 million for 2007 and 2006 , respectively , and a related tax benefit of $ 27.3 million for 2005 .
the change in the effective financial derivatives is presented net of related tax benefit of $ 3.2 million for 2007 , related tax expense of $ 5.7 million for 2006 and related tax benefit of $ 10.7 million for 2005 .
stock-based compensation programs effective january 1 , 2006 , ball adopted sfas no .
123 ( revised 2004 ) , 201cshare based payment , 201d which is a revision of sfas no .
123 and supersedes apb opinion no .
25 .
the new standard establishes accounting standards for transactions in which an entity exchanges its equity instruments for goods or services , including stock option and restricted stock grants .
the major differences for ball are that ( 1 ) expense is now recorded in the consolidated statements of earnings for the fair value of new stock option grants and nonvested portions of grants made prior to january 1 , 2006 , and ( 2 ) the company 2019s deposit share program ( discussed below ) is no longer a variable plan that is marked to current market value each month through earnings .
upon adoption of sfas no .
123 ( revised 2004 ) , ball has chosen to use the modified prospective transition method and the black-scholes valuation model. |
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dd4bba18c | dish network corporation notes to consolidated financial statements - continued ciel ii .
ciel ii , a canadian dbs satellite , was launched in december 2008 and commenced commercial operation during february 2009 .
this satellite is accounted for as a capital lease and depreciated over the term of the satellite service agreement .
we have leased 100% ( 100 % ) of the capacity on ciel ii for an initial 10 year term .
as of december 31 , 2011 and 2010 , we had $ 500 million capitalized for the estimated fair value of satellites acquired under capital leases included in 201cproperty and equipment , net , 201d with related accumulated depreciation of $ 151 million and $ 109 million , respectively .
in our consolidated statements of operations and comprehensive income ( loss ) , we recognized $ 43 million , $ 43 million and $ 40 million in depreciation expense on satellites acquired under capital lease agreements during the years ended december 31 , 2011 , 2010 and 2009 , respectively .
future minimum lease payments under the capital lease obligation , together with the present value of the net minimum lease payments as of december 31 , 2011 are as follows ( in thousands ) : for the years ended december 31 .
2012 | $ 84715
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------
2013 | 77893
2014 | 76296
2015 | 75970
2016 | 75970
thereafter | 314269
total minimum lease payments | 705113
less : amount representing lease of the orbital location and estimated executory costs ( primarily insurance and maintenance ) including profit thereon included in total minimum lease payments | -323382 ( 323382 )
net minimum lease payments | 381731
less : amount representing interest | -109823 ( 109823 )
present value of net minimum lease payments | 271908
less : current portion | -29202 ( 29202 )
long-term portion of capital lease obligations | $ 242706
the summary of future maturities of our outstanding long-term debt as of december 31 , 2011 is included in the commitments table in note 16 .
12 .
income taxes and accounting for uncertainty in income taxes income taxes our income tax policy is to record the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported on our consolidated balance sheets , as well as probable operating loss , tax credit and other carryforwards .
deferred tax assets are offset by valuation allowances when we believe it is more likely than not that net deferred tax assets will not be realized .
we periodically evaluate our need for a valuation allowance .
determining necessary valuation allowances requires us to make assessments about historical financial information as well as the timing of future events , including the probability of expected future taxable income and available tax planning opportunities .
we file consolidated tax returns in the u.s .
the income taxes of domestic and foreign subsidiaries not included in the u.s .
tax group are presented in our consolidated financial statements based on a separate return basis for each tax paying entity .
as of december 31 , 2011 , we had no net operating loss carryforwards ( 201cnols 201d ) for federal income tax purposes and $ 13 million of nol benefit for state income tax purposes .
the state nols begin to expire in the year 2020 .
in addition , there are $ 5 million of tax benefits related to credit carryforwards which are partially offset by a valuation allowance and $ 14 million benefit of capital loss carryforwards which are fully offset by a valuation allowance .
the credit carryforwards begin to expire in the year 2012. |
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dd4bc774c | 152 the pnc financial services group , inc .
2013 form 10-k in addition to the proceedings or other matters described above , pnc and persons to whom we may have indemnification obligations , in the normal course of business , are subject to various other pending and threatened legal proceedings in which claims for monetary damages and other relief are asserted .
we do not anticipate , at the present time , that the ultimate aggregate liability , if any , arising out of such other legal proceedings will have a material adverse effect on our financial position .
however , we cannot now determine whether or not any claims asserted against us or others to whom we may have indemnification obligations , whether in the proceedings or other matters described above or otherwise , will have a material adverse effect on our results of operations in any future reporting period , which will depend on , among other things , the amount of the loss resulting from the claim and the amount of income otherwise reported for the reporting period .
note 20 commitments in the normal course of business , we have various commitments outstanding , certain of which are not included on our consolidated balance sheet .
the following table presents our outstanding commitments to extend credit along with significant other commitments as of december 31 , 2017 and december 31 , 2016 , respectively .
table 98 : commitments to extend credit and other commitments in millions december 31 december 31 .
in millions | december 31 2017 | december 31 2016
------------------------------------------------------- | ---------------- | ----------------
commitments to extend credit | |
total commercial lending | $ 112125 | $ 108256
home equity lines of credit | 17852 | 17438
credit card | 24911 | 22095
other | 4753 | 4192
total commitments to extend credit | 159641 | 151981
net outstanding standby letters ofcredit ( a ) | 8651 | 8324
reinsurance agreements ( b ) | 1654 | 1835
standby bond purchase agreements ( c ) | 843 | 790
other commitments ( d ) | 1732 | 967
total commitments to extendcredit and other commitments | $ 172521 | $ 163897
commitments to extend credit , or net unfunded loan commitments , represent arrangements to lend funds or provide liquidity subject to specified contractual conditions .
these commitments generally have fixed expiration dates , may require payment of a fee , and contain termination clauses in the event the customer 2019s credit quality deteriorates .
net outstanding standby letters of credit we issue standby letters of credit and share in the risk of standby letters of credit issued by other financial institutions , in each case to support obligations of our customers to third parties , such as insurance requirements and the facilitation of transactions involving capital markets product execution .
approximately 91% ( 91 % ) and 94% ( 94 % ) of our net outstanding standby letters of credit were rated as pass as of december 31 , 2017 and december 31 , 2016 , respectively , with the remainder rated as below pass .
an internal credit rating of pass indicates the expected risk of loss is currently low , while a rating of below pass indicates a higher degree of risk .
if the customer fails to meet its financial or performance obligation to the third party under the terms of the contract or there is a need to support a remarketing program , then upon a draw by a beneficiary , subject to the terms of the letter of credit , we would be obligated to make payment to them .
the standby letters of credit outstanding on december 31 , 2017 had terms ranging from less than one year to seven years .
as of december 31 , 2017 , assets of $ 1.3 billion secured certain specifically identified standby letters of credit .
in addition , a portion of the remaining standby letters of credit issued on behalf of specific customers is also secured by collateral or guarantees that secure the customers 2019 other obligations to us .
the carrying amount of the liability for our obligations related to standby letters of credit and participations in standby letters of credit was $ .2 billion at december 31 , 2017 and is included in other liabilities on our consolidated balance sheet. |
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dd4c3d690 | j.p .
morgan chase & co .
/ 2003 annual report 33 corporate credit allocation in 2003 , tss was assigned a corporate credit allocation of pre- tax earnings and the associated capital related to certain credit exposures managed within ib 2019s credit portfolio on behalf of clients shared with tss .
prior periods have been revised to reflect this allocation .
for 2003 , the impact to tss of this change increased pre-tax operating results by $ 36 million and average allocated capital by $ 712 million , and it decreased sva by $ 65 million .
pre-tax operating results were $ 46 million lower than in 2002 , reflecting lower loan volumes and higher related expenses , slightly offset by a decrease in credit costs .
business outlook tss revenue in 2004 is expected to benefit from improved global equity markets and from two recent acquisitions : the november 2003 acquisition of the bank one corporate trust portfolio , and the january 2004 acquisition of citigroup 2019s electronic funds services business .
tss also expects higher costs as it integrates these acquisitions and continues strategic investments to sup- port business expansion .
by client segment tss dimensions of 2003 revenue diversification by business revenue by geographic region investor services 36% ( 36 % ) other 1% ( 1 % ) institutional trust services 23% ( 23 % ) treasury services 40% ( 40 % ) large corporations 21% ( 21 % ) middle market 18% ( 18 % ) banks 11% ( 11 % ) nonbank financial institutions 44% ( 44 % ) public sector/governments 6% ( 6 % ) europe , middle east & africa 27% ( 27 % ) asia/pacific 9% ( 9 % ) the americas 64% ( 64 % ) ( a ) includes the elimination of revenue related to shared activities with chase middle market in the amount of $ 347 million .
year ended december 31 , operating revenue .
year ended december 31 , ( in millions ) | year ended december 31 , 2003 | year ended december 31 , 2002 | change
---------------------------------------- | ----------------------------- | ----------------------------- | ----------
treasury services | $ 1927 | $ 1818 | 6% ( 6 % )
investor services | 1449 | 1513 | -4 ( 4 )
institutional trust services ( a ) | 928 | 864 | 7
other ( a ) ( b ) | -312 ( 312 ) | -303 ( 303 ) | -3 ( 3 )
total treasury & securities services | $ 3992 | $ 3892 | 3% ( 3 % )
( a ) includes a portion of the $ 41 million gain on sale of a nonstrategic business in 2003 : $ 1 million in institutional trust services and $ 40 million in other .
( b ) includes the elimination of revenues related to shared activities with chase middle market , and a $ 50 million gain on sale of a non-u.s .
securities clearing firm in 2002. |
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dd4bb3026 | notes to consolidated financial statements 2014 ( continued ) note 14 2014commitments and contingencies leases we conduct a major part of our operations using leased facilities and equipment .
many of these leases have renewal and purchase options and provide that we pay the cost of property taxes , insurance and maintenance .
rent expense on all operating leases for fiscal 2010 , 2009 and 2008 was $ 32.8 million , $ 30.2 million , and $ 30.4 million , respectively .
future minimum lease payments for all noncancelable leases at may 31 , 2010 were as follows : operating leases .
| operating leases
----------------------------------- | ----------------
2011 | $ 9856
2012 | 3803
2013 | 2538
2014 | 1580
2015 | 928
thereafter | 1428
total future minimum lease payments | $ 20133
we are party to a number of claims and lawsuits incidental to our business .
in the opinion of management , the reasonably possible outcome of such matters , individually or in the aggregate , will not have a material adverse impact on our financial position , liquidity or results of operations .
we define operating taxes as tax contingencies that are unrelated to income taxes , such as sales and property taxes .
during the course of operations , we must interpret the meaning of various operating tax matters in the united states and in the foreign jurisdictions in which we do business .
taxing authorities in those various jurisdictions may arrive at different interpretations of applicable tax laws and regulations as they relate to such operating tax matters , which could result in the payment of additional taxes in those jurisdictions .
as of may 31 , 2010 and 2009 we did not have a liability for operating tax items .
the amount of the liability is based on management 2019s best estimate given our history with similar matters and interpretations of current laws and regulations .
bin/ica agreements in connection with our acquisition of merchant credit card operations of banks , we have entered into sponsorship or depository and processing agreements with certain of the banks .
these agreements allow us to use the banks 2019 identification numbers , referred to as bank identification number for visa transactions and interbank card association number for mastercard transactions , to clear credit card transactions through visa and mastercard .
certain of such agreements contain financial covenants , and we were in compliance with all such covenants as of may 31 , 2010 .
on june 18 , 2010 , cibc provided notice that it will not renew its sponsorship with us for visa in canada after the initial ten year term .
as a result , their canadian visa sponsorship will expire in march 2011 .
we are |
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dd4bb5fd8 | has decreased during the period from 2002 to 2004 , principally due to the increase in earned premium and due to cost containment measures undertaken by management .
in business insurance and personal lines , the expense ratio is expected to decrease further in 2005 , largely as a result of expected increases in earned premium .
in specialty commercial , the expense ratio is expected to increase slightly in 2005 due to changes in the business mix , most notably the company 2019s decision in the fourth quarter of 2004 to exit the multi-peril crop insurance program which will eliminate significant expense reimbursements from the specialty commercial segment .
policyholder dividend ratio : the policyholder dividend ratio is the ratio of policyholder dividends to earned premium .
combined ratio : the combined ratio is the sum of the loss and loss adjustment expense ratio , the expense ratio and the policyholder dividend ratio .
this ratio is a relative measurement that describes the related cost of losses and expense for every $ 100 of earned premiums .
a combined ratio below 100.0 demonstrates underwriting profit ; a combined ratio above 100.0 demonstrates underwriting losses .
the combined ratio has decreased from 2003 to 2004 primarily because of improvement in the expense ratio .
the combined ratio in 2005 could be significantly higher or lower than the 2004 combined ratio depending on the level of catastrophe losses , but will also be impacted by changes in pricing and an expected moderation in favorable loss cost trends .
catastrophe ratio : the catastrophe ratio ( a component of the loss and loss adjustment expense ratio ) represents the ratio of catastrophe losses ( net of reinsurance ) to earned premiums .
a catastrophe is an event that causes $ 25 or more in industry insured property losses and affects a significant number of property and casualty policyholders and insurers .
by their nature , catastrophe losses vary dramatically from year to year .
based on the mix and geographic dispersion of premium written and estimates derived from various catastrophe loss models , the company 2019s expected catastrophe ratio over the long-term is 3.0 points .
before considering the reduction in ongoing operation 2019s catastrophe reserves related to september 11 of $ 298 in 2004 , the catastrophe ratio in 2004 was 5.3 points .
see 201crisk management strategy 201d below for a discussion of the company 2019s property catastrophe risk management program that serves to mitigate the company 2019s net exposure to catastrophe losses .
combined ratio before catastrophes and prior accident year development : the combined ratio before catastrophes and prior accident year development represents the combined ratio for the current accident year , excluding the impact of catastrophes .
the company believes this ratio is an important measure of the trend in profitability since it removes the impact of volatile and unpredictable catastrophe losses and prior accident year reserve development .
before considering catastrophes , the combined ratio related to current accident year business has improved from 2002 to 2004 principally due to earned pricing increases and favorable claim frequency .
other operations underwriting results : the other operations segment is responsible for managing operations of the hartford that have discontinued writing new or renewal business as well as managing the claims related to asbestos and environmental exposures .
as such , neither earned premiums nor underwriting ratios are meaningful financial measures .
instead , management believes that underwriting result is a more meaningful measure .
the net underwriting loss for 2002 through 2004 is primarily due to prior accident year loss development , including $ 2.6 billion of net asbestos reserve strengthening in 2003 .
reserve estimates within other operations , including estimates for asbestos and environmental claims , are inherently uncertain .
refer to the other operations segment md&a for further discussion of other operation's underwriting results .
total property & casualty investment earnings .
| 2004 | 2003 | 2002
----------------------------------------------- | -------------- | -------------- | --------------
investment yield after-tax | 4.1% ( 4.1 % ) | 4.2% ( 4.2 % ) | 4.5% ( 4.5 % )
net realized capital gains ( losses ) after-tax | $ 87 | $ 165 | $ -44 ( 44 )
the investment return , or yield , on property & casualty 2019s invested assets is an important element of the company 2019s earnings since insurance products are priced with the assumption that premiums received can be invested for a period of time before loss and loss adjustment expenses are paid .
for longer tail lines , such as workers 2019 compensation and general liability , claims are paid over several years and , therefore , the premiums received for these lines of business can generate significant investment income .
him determines the appropriate allocation of investments by asset class and measures the investment yield performance for each asset class against market indices or other benchmarks .
due to the emphasis on preservation of capital and the need to maintain sufficient liquidity to satisfy claim obligations , the vast majority of property and casualty 2019s invested assets have been held in fixed maturities , including , among other asset classes , corporate bonds , municipal bonds , government debt , short-term debt , mortgage- |
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dd4c0a4fc | part ii item 5 2013 market for registrant 2019s common equity , related stockholder matters and issuer purchases of equity securities ( a ) ( 1 ) our common stock is listed on the new york stock exchange and is traded under the symbol 201cpnc . 201d at the close of business on february 16 , 2017 , there were 60763 common shareholders of record .
holders of pnc common stock are entitled to receive dividends when declared by the board of directors out of funds legally available for this purpose .
our board of directors may not pay or set apart dividends on the common stock until dividends for all past dividend periods on any series of outstanding preferred stock and certain outstanding capital securities issued by the parent company have been paid or declared and set apart for payment .
the board of directors presently intends to continue the policy of paying quarterly cash dividends .
the amount of any future dividends will depend on economic and market conditions , our financial condition and operating results , and other factors , including contractual restrictions and applicable government regulations and policies ( such as those relating to the ability of bank and non-bank subsidiaries to pay dividends to the parent company and regulatory capital limitations ) .
the amount of our dividend is also currently subject to the results of the supervisory assessment of capital adequacy and capital planning processes undertaken by the federal reserve and our primary bank regulators as part of the comprehensive capital analysis and review ( ccar ) process as described in the supervision and regulation section in item 1 of this report .
the federal reserve has the power to prohibit us from paying dividends without its approval .
for further information concerning dividend restrictions and other factors that could limit our ability to pay dividends , as well as restrictions on loans , dividends or advances from bank subsidiaries to the parent company , see the supervision and regulation section in item 1 , item 1a risk factors , the capital and liquidity management portion of the risk management section in item 7 , and note 10 borrowed funds , note 15 equity and note 18 regulatory matters in the notes to consolidated financial statements in item 8 of this report , which we include here by reference .
we include here by reference additional information relating to pnc common stock under the common stock prices/ dividends declared section in the statistical information ( unaudited ) section of item 8 of this report .
we include here by reference the information regarding our compensation plans under which pnc equity securities are authorized for issuance as of december 31 , 2016 in the table ( with introductory paragraph and notes ) that appears in item 12 of this report .
our stock transfer agent and registrar is : computershare trust company , n.a .
250 royall street canton , ma 02021 800-982-7652 registered shareholders may contact this phone number regarding dividends and other shareholder services .
we include here by reference the information that appears under the common stock performance graph caption at the end of this item 5 .
( a ) ( 2 ) none .
( b ) not applicable .
( c ) details of our repurchases of pnc common stock during the fourth quarter of 2016 are included in the following table : in thousands , except per share data 2016 period total shares purchased ( a ) average paid per total shares purchased as part of publicly announced programs ( b ) maximum number of shares that may yet be purchased under the programs ( b ) .
2016 period | total sharespurchased ( a ) | averagepricepaid pershare | total sharespurchased aspartofpubliclyannouncedprograms ( b ) | maximumnumber ofshares thatmay yet bepurchasedundertheprograms ( b )
------------------ | --------------------------- | ------------------------- | ------------------------------------------------------------- | --------------------------------------------------------------------
october 1 2013 31 | 2277 | $ 91.15 | 2245 | 61962
november 1 2013 30 | 1243 | $ 103.50 | 1243 | 60719
december 1 2013 31 | 1449 | $ 115.65 | 1449 | 59270
total | 4969 | $ 101.39 | |
( a ) includes pnc common stock purchased in connection with our various employee benefit plans generally related to forfeitures of unvested restricted stock awards and shares used to cover employee payroll tax withholding requirements .
note 11 employee benefit plans and note 12 stock based compensation plans in the notes to consolidated financial statements in item 8 of this report include additional information regarding our employee benefit and equity compensation plans that use pnc common stock .
( b ) on march 11 , 2015 , we announced that our board of directors approved the establishment of a stock repurchase program authorization in the amount of 100 million shares of pnc common stock , effective april 1 , 2015 .
repurchases are made in open market or privately negotiated transactions and the timing and exact amount of common stock repurchases will depend on a number of factors including , among others , market and general economic conditions , regulatory capital considerations , alternative uses of capital , the potential impact on our credit ratings , and contractual and regulatory limitations , including the results of the supervisory assessment of capital adequacy and capital planning processes undertaken by the federal reserve as part of the ccar process .
in june 2016 , we announced share repurchase programs of up to $ 2.0 billion for the four quarter period beginning with the third quarter of 2016 , including repurchases of up to $ 200 million related to employee benefit plans .
in january 2017 , we announced a $ 300 million increase in our share repurchase programs for this period .
in the fourth quarter of 2016 , we repurchased 4.9 million shares of common stock on the open market , with an average price of $ 101.47 per share and an aggregate repurchase price of $ .5 billion .
see the liquidity and capital management portion of the risk management section in item 7 of this report for more information on the share repurchase programs under the share repurchase authorization for the period july 1 , 2016 through june 30 , 2017 included in the 2016 capital plan accepted by the federal reserve .
28 the pnc financial services group , inc .
2013 form 10-k |
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dd4bcd5f2 | compared to 2007 .
we reduced personal injury expense by $ 80 million in 2007 as a result of fewer than expected claims and lower than expected average settlement costs .
in 2008 , we reduced personal injury expense and asbestos-related costs $ 82 million based on the results of updated personal injury actuarial studies and a reassessment of our potential liability for resolution of current and future asbestos claims .
in addition , environmental and toxic tort expenses were $ 7 million lower in 2008 compared to 2007 .
other costs were lower in 2007 compared to 2006 driven primarily by a reduction in personal injury expense .
actuarial studies completed during 2007 resulted in a reduction in personal injury expense of $ 80 million , which was partially offset by an adverse development with respect to one claim .
settlement of insurance claims in 2007 related to hurricane rita , and higher equity income also drove expenses lower in 2007 versus 2006 .
conversely , the year-over-year comparison was affected by the settlement of insurance claims totaling $ 23 million in 2006 related to the january 2005 west coast storm and a $ 9 million gain in 2006 from the sale of two company-owned airplanes .
non-operating items millions of dollars 2008 2007 2006 % ( % ) change 2008 v 2007 % ( % ) change 2007 v 2006 .
millions of dollars | 2008 | 2007 | 2006 | % ( % ) change 2008 v 2007 | % ( % ) change 2007 v 2006
------------------- | -------------- | -------------- | ------------ | --------------------------- | ---------------------------
other income | $ 92 | $ 116 | $ 118 | ( 21 ) % ( % ) | ( 2 ) % ( % )
interest expense | -511 ( 511 ) | -482 ( 482 ) | -477 ( 477 ) | 6 | 1
income taxes | -1318 ( 1318 ) | -1154 ( 1154 ) | -919 ( 919 ) | 14 % ( % ) | 26 % ( % )
other income 2013 other income decreased in 2008 compared to 2007 due to lower gains from real estate sales and decreased returns on cash investments reflecting lower interest rates .
higher rental and licensing income and lower interest expense on our sale of receivables program partially offset the decreases .
lower net gains from non-operating asset sales ( primarily real estate ) drove the reduction in other income in 2007 .
recognition of rental income in 2006 from the settlement of a rent dispute also contributed to the year-over-year decrease in other income .
cash investment returns increased $ 21 million due to larger cash balances and higher interest rates .
interest expense 2013 interest expense increased in 2008 versus 2007 due to a higher weighted-average debt level of $ 8.3 billion , compared to $ 7.3 billion in 2007 .
a lower effective interest rate of 6.1% ( 6.1 % ) in 2008 , compared to 6.6% ( 6.6 % ) in 2007 , partially offset the effects of the higher weighted-average debt level .
an increase in the weighted-average debt levels to $ 7.3 billion from $ 7.1 billion in 2006 generated higher interest expense in 2007 .
a lower effective interest rate of 6.6% ( 6.6 % ) in 2007 , compared to 6.7% ( 6.7 % ) in 2006 , partially offset the effects of the higher debt level .
income taxes 2013 income taxes were higher in 2008 compared to 2007 , driven by higher pre-tax income .
our effective tax rates were 36.1% ( 36.1 % ) and 38.4% ( 38.4 % ) in 2008 and 2007 , respectively .
the lower effective tax rate in 2008 resulted from several reductions in tax expense related to federal audits and state tax law changes .
in addition , the effective tax rate in 2007 was increased by illinois legislation that increased deferred tax expense in the third quarter of 2007 .
income taxes were $ 235 million higher in 2007 compared to 2006 , due primarily to higher pre-tax income and the effect of new tax legislation in the state of illinois that changed how we determine the amount of our income subject to illinois tax .
the illinois legislation increased our deferred tax expense by $ 27 million in 2007 .
our effective tax rates were 38.4% ( 38.4 % ) and 36.4% ( 36.4 % ) in 2007 and 2006 , respectively. |
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dd4bc26ca | entergy corporation and subsidiaries notes to financial statements equitable discretion and not require refunds for the 20-month period from september 13 , 2001 - may 2 , 2003 .
because the ruling on refunds relied on findings in the interruptible load proceeding , which is discussed in a separate section below , the ferc concluded that the refund ruling will be held in abeyance pending the outcome of the rehearing requests in that proceeding .
on the second issue , the ferc reversed its prior decision and ordered that the prospective bandwidth remedy begin on june 1 , 2005 ( the date of its initial order in the proceeding ) rather than january 1 , 2006 , as it had previously ordered .
pursuant to the october 2011 order , entergy was required to calculate the additional bandwidth payments for the period june - december 2005 utilizing the bandwidth formula tariff prescribed by the ferc that was filed in a december 2006 compliance filing and accepted by the ferc in an april 2007 order .
as is the case with bandwidth remedy payments , these payments and receipts will ultimately be paid by utility operating company customers to other utility operating company customers .
in december 2011 , entergy filed with the ferc its compliance filing that provides the payments and receipts among the utility operating companies pursuant to the ferc 2019s october 2011 order .
the filing shows the following payments/receipts among the utility operating companies : payments ( receipts ) ( in millions ) .
| payments ( receipts ) ( in millions )
----------------------------- | -------------------------------------
entergy arkansas | $ 156
entergy gulf states louisiana | ( $ 75 )
entergy louisiana | $ 2014
entergy mississippi | ( $ 33 )
entergy new orleans | ( $ 5 )
entergy texas | ( $ 43 )
entergy arkansas made its payment in january 2012 .
in february 2012 , entergy arkansas filed for an interim adjustment to its production cost allocation rider requesting that the $ 156 million payment be collected from customers over the 22-month period from march 2012 through december 2013 .
in march 2012 the apsc issued an order stating that the payment can be recovered from retail customers through the production cost allocation rider , subject to refund .
the lpsc and the apsc have requested rehearing of the ferc 2019s october 2011 order .
in december 2013 the lpsc filed a petition for a writ of mandamus at the united states court of appeals for the d.c .
circuit .
in its petition , the lpsc requested that the d.c .
circuit issue an order compelling the ferc to issue a final order on pending rehearing requests .
in its response to the lpsc petition , the ferc committed to rule on the pending rehearing request before the end of february .
in january 2014 the d.c .
circuit denied the lpsc's petition .
the apsc , the lpsc , the puct , and other parties intervened in the december 2011 compliance filing proceeding , and the apsc and the lpsc also filed protests .
calendar year 2013 production costs the liabilities and assets for the preliminary estimate of the payments and receipts required to implement the ferc 2019s remedy based on calendar year 2013 production costs were recorded in december 2013 , based on certain year-to-date information .
the preliminary estimate was recorded based on the following estimate of the payments/receipts among the utility operating companies for 2014. |
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dd4c37f2e | corporate & institutional banking corporate & institutional banking earned $ 1.9 billion in 2011 and $ 1.8 billion in 2010 .
the increase in earnings was primarily due to an improvement in the provision for credit losses , which was a benefit in 2011 , partially offset by a reduction in the value of commercial mortgage servicing rights and lower net interest income .
we continued to focus on adding new clients , increasing cross sales , and remaining committed to strong expense discipline .
asset management group asset management group earned $ 141 million for 2011 compared with $ 137 million for 2010 .
assets under administration were $ 210 billion at december 31 , 2011 and $ 212 billion at december 31 , 2010 .
earnings for 2011 reflected a benefit from the provision for credit losses and growth in noninterest income , partially offset by higher noninterest expense and lower net interest income .
for 2011 , the business delivered strong sales production , grew high value clients and benefitted from significant referrals from other pnc lines of business .
over time and with stabilized market conditions , the successful execution of these strategies and the accumulation of our strong sales performance are expected to create meaningful growth in assets under management and noninterest income .
residential mortgage banking residential mortgage banking earned $ 87 million in 2011 compared with $ 269 million in 2010 .
the decline in earnings was driven by an increase in noninterest expense associated with increased costs for residential mortgage foreclosure- related expenses , primarily as a result of ongoing governmental matters , and lower net interest income , partially offset by an increase in loan originations and higher loans sales revenue .
blackrock our blackrock business segment earned $ 361 million in 2011 and $ 351 million in 2010 .
the higher business segment earnings from blackrock for 2011 compared with 2010 were primarily due to an increase in revenue .
non-strategic assets portfolio this business segment ( formerly distressed assets portfolio ) consists primarily of acquired non-strategic assets that fall outside of our core business strategy .
non-strategic assets portfolio had earnings of $ 200 million in 2011 compared with a loss of $ 57 million in 2010 .
the increase was primarily attributable to a lower provision for credit losses partially offset by lower net interest income .
201cother 201d reported earnings of $ 376 million for 2011 compared with earnings of $ 386 million for 2010 .
the decrease in earnings primarily reflected the noncash charge related to the redemption of trust preferred securities in the fourth quarter of 2011 and the gain related to the sale of a portion of pnc 2019s blackrock shares in 2010 partially offset by lower integration costs in 2011 .
consolidated income statement review our consolidated income statement is presented in item 8 of this report .
net income for 2011 was $ 3.1 billion compared with $ 3.4 billion for 2010 .
results for 2011 include the impact of $ 324 million of residential mortgage foreclosure-related expenses primarily as a result of ongoing governmental matters , a $ 198 million noncash charge related to redemption of trust preferred securities and $ 42 million for integration costs .
results for 2010 included the $ 328 million after-tax gain on our sale of gis , $ 387 million for integration costs , and $ 71 million of residential mortgage foreclosure-related expenses .
for 2010 , net income attributable to common shareholders was also impacted by a noncash reduction of $ 250 million in connection with the redemption of tarp preferred stock .
pnc 2019s results for 2011 were driven by good performance in a challenging environment of low interest rates , slow economic growth and new regulations .
net interest income and net interest margin year ended december 31 dollars in millions 2011 2010 .
year ended december 31dollars in millions | 2011 | 2010
----------------------------------------- | ---------------- | ----------------
net interest income | $ 8700 | $ 9230
net interest margin | 3.92% ( 3.92 % ) | 4.14% ( 4.14 % )
changes in net interest income and margin result from the interaction of the volume and composition of interest-earning assets and related yields , interest-bearing liabilities and related rates paid , and noninterest-bearing sources of funding .
see the statistical information ( unaudited ) 2013 analysis of year-to-year changes in net interest income and average consolidated balance sheet and net interest analysis in item 8 and the discussion of purchase accounting accretion in the consolidated balance sheet review in item 7 of this report for additional information .
the decreases in net interest income and net interest margin for 2011 compared with 2010 were primarily attributable to a decrease in purchase accounting accretion on purchased impaired loans primarily due to lower excess cash recoveries .
a decline in average loan balances and the low interest rate environment , partially offset by lower funding costs , also contributed to the decrease .
the pnc financial services group , inc .
2013 form 10-k 35 |
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dd4971178 | jpmorgan chase & co .
/ 2007 annual report 31 the following section provides a comparative discussion of jpmorgan chase 2019s consolidated results of operations on a reported basis for the three-year period ended december 31 , 2007 .
factors that relate primarily to a single business segment are discussed in more detail within that business segment than they are in this consolidated sec- tion .
for a discussion of the critical accounting estimates used by the firm that affect the consolidated results of operations , see pages 96 201398 of this annual report .
revenue .
year ended december 31 ( in millions ) | 2007 | 2006 | 2005
----------------------------------------------- | ------- | ------------ | --------------
investment banking fees | $ 6635 | $ 5520 | $ 4088
principal transactions | 9015 | 10778 | 8072
lending & deposit-related fees | 3938 | 3468 | 3389
asset management administration and commissions | 14356 | 11855 | 9988
securities gains ( losses ) | 164 | -543 ( 543 ) | -1336 ( 1336 )
mortgage fees and related income | 2118 | 591 | 1054
credit card income | 6911 | 6913 | 6754
other income | 1829 | 2175 | 2684
noninterest revenue | 44966 | 40757 | 34693
net interest income | 26406 | 21242 | 19555
total net revenue | $ 71372 | $ 61999 | $ 54248
2007 compared with 2006 total net revenue of $ 71.4 billion was up $ 9.4 billion , or 15% ( 15 % ) , from the prior year .
higher net interest income , very strong private equity gains , record asset management , administration and commissions revenue , higher mortgage fees and related income and record investment banking fees contributed to the revenue growth .
these increases were offset partially by lower trading revenue .
investment banking fees grew in 2007 to a level higher than the pre- vious record set in 2006 .
record advisory and equity underwriting fees drove the results , partially offset by lower debt underwriting fees .
for a further discussion of investment banking fees , which are primarily recorded in ib , see the ib segment results on pages 40 201342 of this annual report .
principal transactions revenue consists of trading revenue and private equity gains .
trading revenue declined significantly from the 2006 level , primarily due to markdowns in ib of $ 1.4 billion ( net of hedges ) on subprime positions , including subprime cdos , and $ 1.3 billion ( net of fees ) on leveraged lending funded loans and unfunded commitments .
also in ib , markdowns in securitized products on nonsubprime mortgages and weak credit trading performance more than offset record revenue in currencies and strong revenue in both rates and equities .
equities benefited from strong client activity and record trading results across all products .
ib 2019s credit portfolio results increased compared with the prior year , primarily driven by higher revenue from risk management activities .
the increase in private equity gains from 2006 reflected a significantly higher level of gains , the classification of certain private equity carried interest as compensation expense and a fair value adjustment in the first quarter of 2007 on nonpublic private equity investments resulting from the adoption of sfas 157 ( 201cfair value measurements 201d ) .
for a further discussion of principal transactions revenue , see the ib and corporate segment results on pages 40 201342 and 59 201360 , respectively , and note 6 on page 122 of this annual report .
lending & deposit-related fees rose from the 2006 level , driven pri- marily by higher deposit-related fees and the bank of new york transaction .
for a further discussion of lending & deposit-related fees , which are mostly recorded in rfs , tss and cb , see the rfs segment results on pages 43 201348 , the tss segment results on pages 54 201355 , and the cb segment results on pages 52 201353 of this annual report .
asset management , administration and commissions revenue reached a level higher than the previous record set in 2006 .
increased assets under management and higher performance and placement fees in am drove the record results .
the 18% ( 18 % ) growth in assets under management from year-end 2006 came from net asset inflows and market appreciation across all segments : institutional , retail , private bank and private client services .
tss also contributed to the rise in asset management , administration and commissions revenue , driven by increased product usage by new and existing clients and market appreciation on assets under custody .
finally , commissions revenue increased , due mainly to higher brokerage transaction volume ( primarily included within fixed income and equity markets revenue of ib ) , which more than offset the sale of the insurance business by rfs in the third quarter of 2006 and a charge in the first quarter of 2007 resulting from accelerated surrenders of customer annuities .
for additional information on these fees and commissions , see the segment discussions for ib on pages 40 201342 , rfs on pages 43 201348 , tss on pages 54 201355 , and am on pages 56 201358 , of this annual report .
the favorable variance resulting from securities gains in 2007 compared with securities losses in 2006 was primarily driven by improvements in the results of repositioning of the treasury invest- ment securities portfolio .
also contributing to the positive variance was a $ 234 million gain from the sale of mastercard shares .
for a fur- ther discussion of securities gains ( losses ) , which are mostly recorded in the firm 2019s treasury business , see the corporate segment discussion on pages 59 201360 of this annual report .
consol idated results of operat ions |
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dd4bbb668 | entergy arkansas , inc .
and subsidiaries management 2019s financial discussion and analysis plan to spin off the utility 2019s transmission business see the 201cplan to spin off the utility 2019s transmission business 201d section of entergy corporation and subsidiaries management 2019s financial discussion and analysis for a discussion of this matter , including the planned retirement of debt and preferred securities .
results of operations net income 2011 compared to 2010 net income decreased $ 7.7 million primarily due to a higher effective income tax rate , lower other income , and higher other operation and maintenance expenses , substantially offset by higher net revenue , lower depreciation and amortization expenses , and lower interest expense .
2010 compared to 2009 net income increased $ 105.7 million primarily due to higher net revenue , a lower effective income tax rate , higher other income , and lower depreciation and amortization expenses , partially offset by higher other operation and maintenance expenses .
net revenue 2011 compared to 2010 net revenue consists of operating revenues net of : 1 ) fuel , fuel-related expenses , and gas purchased for resale , 2 ) purchased power expenses , and 3 ) other regulatory charges ( credits ) .
following is an analysis of the change in net revenue comparing 2011 to 2010 .
amount ( in millions ) .
| amount ( in millions )
----------------------------- | ----------------------
2010 net revenue | $ 1216.7
retail electric price | 31.0
ano decommissioning trust | 26.4
transmission revenue | 13.1
volume/weather | -15.9 ( 15.9 )
net wholesale revenue | -11.9 ( 11.9 )
capacity acquisition recovery | -10.3 ( 10.3 )
other | 3.2
2011 net revenue | $ 1252.3
the retail electric price variance is primarily due to a base rate increase effective july 2010 .
see note 2 to the financial statements for more discussion of the rate case settlement .
the ano decommissioning trust variance is primarily related to the deferral of investment gains from the ano 1 and 2 decommissioning trust in 2010 in accordance with regulatory treatment .
the gains resulted in an increase in 2010 in interest and investment income and a corresponding increase in regulatory charges with no effect on net income. |
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dd4ba4bd4 | while we have remediated the previously-identified material weakness in our internal control over financial reporting , we may identify other material weaknesses in the future .
in november 2017 , we restated our consolidated financial statements for the quarters ended april 1 , 2017 and july 1 , 2017 in order to correctly classify cash receipts from the payments on sold receivables ( which are cash receipts on the underlying trade receivables that have already been securitized ) to cash provided by investing activities ( from cash provided by operating activities ) within our condensed consolidated statements of cash flows .
in connection with these restatements , management identified a material weakness in our internal control over financial reporting related to the misapplication of accounting standards update 2016-15 .
specifically , we did not maintain effective controls over the adoption of new accounting standards , including communication with the appropriate individuals in coming to our conclusions on the application of new accounting standards .
as a result of this material weakness , our management concluded that we did not maintain effective internal control over financial reporting as of april 1 , 2017 and july 1 , 2017 .
while we have remediated the material weakness and our management has determined that our disclosure controls and procedures were effective as of december 30 , 2017 , there can be no assurance that our controls will remain adequate .
the effectiveness of our internal control over financial reporting is subject to various inherent limitations , including judgments used in decision-making , the nature and complexity of the transactions we undertake , assumptions about the likelihood of future events , the soundness of our systems , cost limitations , and other limitations .
if other material weaknesses or significant deficiencies in our internal control are discovered or occur in the future or we otherwise must restate our financial statements , it could materially and adversely affect our business and results of operations or financial condition , restrict our ability to access the capital markets , require us to expend significant resources to correct the weaknesses or deficiencies , subject us to fines , penalties , investigations or judgments , harm our reputation , or otherwise cause a decline in investor confidence .
item 1b .
unresolved staff comments .
item 2 .
properties .
our corporate co-headquarters are located in pittsburgh , pennsylvania and chicago , illinois .
our co-headquarters are leased and house certain executive offices , our u.s .
business units , and our administrative , finance , legal , and human resource functions .
we maintain additional owned and leased offices throughout the regions in which we operate .
we manufacture our products in our network of manufacturing and processing facilities located throughout the world .
as of december 30 , 2017 , we operated 83 manufacturing and processing facilities .
we own 80 and lease three of these facilities .
our manufacturing and processing facilities count by segment as of december 30 , 2017 was: .
| owned | leased
------------- | ----- | ------
united states | 41 | 1
canada | 2 | 2014
europe | 11 | 2014
rest of world | 26 | 2
we maintain all of our manufacturing and processing facilities in good condition and believe they are suitable and are adequate for our present needs .
we also enter into co-manufacturing arrangements with third parties if we determine it is advantageous to outsource the production of any of our products .
item 3 .
legal proceedings .
we are routinely involved in legal proceedings , claims , and governmental inquiries , inspections or investigations ( 201clegal matters 201d ) arising in the ordinary course of our business .
while we cannot predict with certainty the results of legal matters in which we are currently involved or may in the future be involved , we do not expect that the ultimate costs to resolve any of the legal matters that are currently pending will have a material adverse effect on our financial condition or results of operations .
item 4 .
mine safety disclosures .
not applicable. |
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dd4b99afe | notes to consolidated financial statements 1 .
basis of presentation the accompanying consolidated financial statements and notes thereto have been prepared in accordance with u.s .
generally accepted accounting principles ( "u.s .
gaap" ) .
the consolidated financial statements include the accounts of aon plc and all of its controlled subsidiaries ( "aon" or the "company" ) .
all intercompany accounts and transactions have been eliminated .
the consolidated financial statements include , in the opinion of management , all adjustments necessary to present fairly the company's consolidated financial position , results of operations and cash flows for all periods presented .
reclassification certain amounts in prior years' consolidated financial statements and related notes have been reclassified to conform to the 2015 presentation .
in prior periods , long-term investments were included in investments in the consolidated statement of financial position .
these amounts are now included in other non-current assets in the consolidated statement of financial position , as shown in note 3 to these consolidated financial statements .
long-term investments were $ 135 million at december 31 , 2015 and $ 143 million at december 31 , 2014 .
in prior periods , prepaid pensions were included in other non-current assets in the consolidated statement of financial position .
these amounts are now separately disclosed in the consolidated statement of financial position .
prepaid pensions were $ 1033 million at december 31 , 2015 and $ 933 million at december 31 , 2014 .
upon vesting of certain share-based payment arrangements , employees may elect to use a portion of the shares to satisfy tax withholding requirements , in which case aon makes a payment to the taxing authority on the employee 2019s behalf and remits the remaining shares to the employee .
the company has historically presented amounts due to taxing authorities within cash flows from operating activities in the consolidated statements of cash flows .
the amounts are now included in 201cissuance of shares for employee benefit plans 201d within cash flows from financing activities .
the company believes this presentation provides greater clarity into the operating and financing activities of the company as the substance and accounting for these transactions is that of a share repurchase .
it also aligns the company 2019s presentation to be consistent with industry practice .
amounts reported in issuance of shares for employee benefit plans were $ 227 million , $ 170 million , and $ 120 million , respectively , for the years ended december 31 , 2015 , 2014 and 2013 .
these amounts , which were reclassified from accounts payable and accrued liabilities and other assets and liabilities , were $ 85 million and $ 85 million in 2014 , and $ 62 million and $ 58 million in 2013 , respectively .
changes to the presentation in the consolidated statements of cash flows for 2014 and 2013 were made related to certain line items within financing activities .
the following line items and respective amounts have been aggregated in a new line item titled 201cnoncontrolling interests and other financing activities 201d within financing activities. .
years ended december 31, | 2014 | 2013
------------------------------------------------- | ---------- | ----------
purchases of shares from noncontrolling interests | 3 | -8 ( 8 )
dividends paid to noncontrolling interests | -24 ( 24 ) | -19 ( 19 )
proceeds from sale-leaseback | 25 | 2014
use of estimates the preparation of the accompanying consolidated financial statements in conformity with u.s .
gaap requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities , disclosures of contingent assets and liabilities at the date of the financial statements , and the reported amounts of reserves and expenses .
these estimates and assumptions are based on management's best estimates and judgments .
management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors , including the current economic environment .
management believes its estimates to be reasonable given the current facts available .
aon adjusts such estimates and assumptions when facts and circumstances dictate .
illiquid credit markets , volatile equity markets , and foreign currency exchange rate movements increase the uncertainty inherent in such estimates and assumptions .
as future events and their effects cannot be determined , among other factors , with precision , actual results could differ significantly from these estimates .
changes in estimates resulting from continuing changes in the economic environment would , if applicable , be reflected in the financial statements in future periods. |
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dd4b88146 | long-term product offerings include alpha-seeking active and index strategies .
our alpha-seeking active strategies seek to earn attractive returns in excess of a market benchmark or performance hurdle while maintaining an appropriate risk profile , and leverage fundamental research and quantitative models to drive portfolio construction .
in contrast , index strategies seek to closely track the returns of a corresponding index , generally by investing in substantially the same underlying securities within the index or in a subset of those securities selected to approximate a similar risk and return profile of the index .
index strategies include both our non-etf index products and ishares etfs .
although many clients use both alpha-seeking active and index strategies , the application of these strategies may differ .
for example , clients may use index products to gain exposure to a market or asset class , or may use a combination of index strategies to target active returns .
in addition , institutional non-etf index assignments tend to be very large ( multi-billion dollars ) and typically reflect low fee rates .
net flows in institutional index products generally have a small impact on blackrock 2019s revenues and earnings .
equity year-end 2017 equity aum totaled $ 3.372 trillion , reflecting net inflows of $ 130.1 billion .
net inflows included $ 174.4 billion into ishares etfs , driven by net inflows into core funds and broad developed and emerging market equities , partially offset by non-etf index and active net outflows of $ 25.7 billion and $ 18.5 billion , respectively .
blackrock 2019s effective fee rates fluctuate due to changes in aum mix .
approximately half of blackrock 2019s equity aum is tied to international markets , including emerging markets , which tend to have higher fee rates than u.s .
equity strategies .
accordingly , fluctuations in international equity markets , which may not consistently move in tandem with u.s .
markets , have a greater impact on blackrock 2019s equity revenues and effective fee rate .
fixed income fixed income aum ended 2017 at $ 1.855 trillion , reflecting net inflows of $ 178.8 billion .
in 2017 , active net inflows of $ 21.5 billion were diversified across fixed income offerings , and included strong inflows into municipal , unconstrained and total return bond funds .
ishares etfs net inflows of $ 67.5 billion were led by flows into core , corporate and treasury bond funds .
non-etf index net inflows of $ 89.8 billion were driven by demand for liability-driven investment solutions .
multi-asset blackrock 2019s multi-asset team manages a variety of balanced funds and bespoke mandates for a diversified client base that leverages our broad investment expertise in global equities , bonds , currencies and commodities , and our extensive risk management capabilities .
investment solutions might include a combination of long-only portfolios and alternative investments as well as tactical asset allocation overlays .
component changes in multi-asset aum for 2017 are presented below .
( in millions ) december 31 , net inflows ( outflows ) market change impact december 31 .
( in millions ) | december 312016 | net inflows ( outflows ) | marketchange | fximpact | december 312017
----------------------------- | --------------- | ------------------------ | ------------ | -------- | ---------------
asset allocation and balanced | $ 176675 | $ -2502 ( 2502 ) | $ 17387 | $ 4985 | $ 196545
target date/risk | 149432 | 23925 | 24532 | 1577 | 199466
fiduciary | 68395 | -1047 ( 1047 ) | 7522 | 8819 | 83689
futureadvisor ( 1 ) | 505 | -46 ( 46 ) | 119 | 2014 | 578
total | $ 395007 | $ 20330 | $ 49560 | $ 15381 | $ 480278
( 1 ) futureadvisor amounts do not include aum held in ishares etfs .
multi-asset net inflows reflected ongoing institutional demand for our solutions-based advice with $ 18.9 billion of net inflows coming from institutional clients .
defined contribution plans of institutional clients remained a significant driver of flows , and contributed $ 20.8 billion to institutional multi-asset net inflows in 2017 , primarily into target date and target risk product offerings .
retail net inflows of $ 1.1 billion reflected demand for our multi-asset income fund family , which raised $ 5.8 billion in 2017 .
the company 2019s multi-asset strategies include the following : 2022 asset allocation and balanced products represented 41% ( 41 % ) of multi-asset aum at year-end .
these strategies combine equity , fixed income and alternative components for investors seeking a tailored solution relative to a specific benchmark and within a risk budget .
in certain cases , these strategies seek to minimize downside risk through diversification , derivatives strategies and tactical asset allocation decisions .
flagship products in this category include our global allocation and multi-asset income fund families .
2022 target date and target risk products grew 16% ( 16 % ) organically in 2017 , with net inflows of $ 23.9 billion .
institutional investors represented 93% ( 93 % ) of target date and target risk aum , with defined contribution plans accounting for 87% ( 87 % ) of aum .
flows were driven by defined contribution investments in our lifepath offerings .
lifepath products utilize a proprietary active asset allocation overlay model that seeks to balance risk and return over an investment horizon based on the investor 2019s expected retirement timing .
underlying investments are primarily index products .
2022 fiduciary management services are complex mandates in which pension plan sponsors or endowments and foundations retain blackrock to assume responsibility for some or all aspects of investment management .
these customized services require strong partnership with the clients 2019 investment staff and trustees in order to tailor investment strategies to meet client-specific risk budgets and return objectives. |
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dd4b901ac | financial statement impact we believe that our accruals for sales returns , rebates , and discounts are reasonable and appropriate based on current facts and circumstances .
our global rebate and discount liabilities are included in sales rebates and discounts on our consolidated balance sheet .
our global sales return liability is included in other current liabilities and other noncurrent liabilities on our consolidated balance sheet .
as of december 31 , 2018 , a 5 percent change in our global sales return , rebate , and discount liability would have led to an approximate $ 275 million effect on our income before income taxes .
the portion of our global sales return , rebate , and discount liability resulting from sales of our products in the u.s .
was approximately 90 percent as of december 31 , 2018 and december 31 , 2017 .
the following represents a roll-forward of our most significant u.s .
pharmaceutical sales return , rebate , and discount liability balances , including managed care , medicare , and medicaid: .
( dollars in millions ) | 2018 | 2017
----------------------------------------------------------------------- | -------------------- | --------------------
sales return rebate and discount liabilities beginning of year | $ 4172.0 | $ 3601.8
reduction of net sales due to sales returns discounts and rebates ( 1 ) | 12529.6 | 10603.4
cash payments of discounts and rebates | -12023.4 ( 12023.4 ) | -10033.2 ( 10033.2 )
sales return rebate and discount liabilities end of year | $ 4678.2 | $ 4172.0
( 1 ) adjustments of the estimates for these returns , rebates , and discounts to actual results were approximately 1 percent of consolidated net sales for each of the years presented .
product litigation liabilities and other contingencies background and uncertainties product litigation liabilities and other contingencies are , by their nature , uncertain and based upon complex judgments and probabilities .
the factors we consider in developing our product litigation liability reserves and other contingent liability amounts include the merits and jurisdiction of the litigation , the nature and the number of other similar current and past matters , the nature of the product and the current assessment of the science subject to the litigation , and the likelihood of settlement and current state of settlement discussions , if any .
in addition , we accrue for certain product liability claims incurred , but not filed , to the extent we can formulate a reasonable estimate of their costs based primarily on historical claims experience and data regarding product usage .
we accrue legal defense costs expected to be incurred in connection with significant product liability contingencies when both probable and reasonably estimable .
we also consider the insurance coverage we have to diminish the exposure for periods covered by insurance .
in assessing our insurance coverage , we consider the policy coverage limits and exclusions , the potential for denial of coverage by the insurance company , the financial condition of the insurers , and the possibility of and length of time for collection .
due to a very restrictive market for product liability insurance , we are self-insured for product liability losses for all our currently marketed products .
in addition to insurance coverage , we also consider any third-party indemnification to which we are entitled or under which we are obligated .
with respect to our third-party indemnification rights , these considerations include the nature of the indemnification , the financial condition of the indemnifying party , and the possibility of and length of time for collection .
the litigation accruals and environmental liabilities and the related estimated insurance recoverables have been reflected on a gross basis as liabilities and assets , respectively , on our consolidated balance sheets .
impairment of indefinite-lived and long-lived assets background and uncertainties we review the carrying value of long-lived assets ( both intangible and tangible ) for potential impairment on a periodic basis and whenever events or changes in circumstances indicate the carrying value of an asset ( or asset group ) may not be recoverable .
we identify impairment by comparing the projected undiscounted cash flows to be generated by the asset ( or asset group ) to its carrying value .
if an impairment is identified , a loss is recorded equal to the excess of the asset 2019s net book value over its fair value , and the cost basis is adjusted .
goodwill and indefinite-lived intangible assets are reviewed for impairment at least annually and when certain impairment indicators are present .
when required , a comparison of fair value to the carrying amount of assets is performed to determine the amount of any impairment. |
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dd4bc80a2 | capital asset purchases associated with the retail segment were $ 294 million in 2007 , bringing the total capital asset purchases since inception of the retail segment to $ 1.0 billion .
as of september 29 , 2007 , the retail segment had approximately 7900 employees and had outstanding operating lease commitments associated with retail store space and related facilities of $ 1.1 billion .
the company would incur substantial costs if it were to close multiple retail stores .
such costs could adversely affect the company 2019s financial condition and operating results .
other segments the company 2019s other segments , which consists of its asia pacific and filemaker operations , experienced an increase in net sales of $ 406 million , or 30% ( 30 % ) during 2007 compared to 2006 .
this increase related primarily to a 58% ( 58 % ) increase in sales of mac portable products and strong ipod sales in the company 2019s asia pacific region .
during 2006 , net sales in other segments increased 35% ( 35 % ) compared to 2005 primarily due to an increase in sales of ipod and mac portable products .
strong sales growth was a result of the introduction of the updated ipods featuring video-playing capabilities and the new intel-based mac portable products that translated to a 16% ( 16 % ) increase in mac unit sales during 2006 compared to 2005 .
gross margin gross margin for each of the last three fiscal years are as follows ( in millions , except gross margin percentages ) : september 29 , september 30 , september 24 , 2007 2006 2005 .
| september 29 2007 | september 30 2006 | september 24 2005
----------------------- | ----------------- | ----------------- | -----------------
net sales | $ 24006 | $ 19315 | $ 13931
cost of sales | 15852 | 13717 | 9889
gross margin | $ 8154 | $ 5598 | $ 4042
gross margin percentage | 34.0% ( 34.0 % ) | 29.0% ( 29.0 % ) | 29.0% ( 29.0 % )
gross margin percentage of 34.0% ( 34.0 % ) in 2007 increased significantly from 29.0% ( 29.0 % ) in 2006 .
the primary drivers of this increase were more favorable costs on certain commodity components , including nand flash memory and dram memory , higher overall revenue that provided for more leverage on fixed production costs and a higher percentage of revenue from the company 2019s direct sales channels .
the company anticipates that its gross margin and the gross margins of the personal computer , consumer electronics and mobile communication industries will be subject to pressure due to price competition .
the company expects gross margin percentage to decline sequentially in the first quarter of 2008 primarily as a result of the full-quarter impact of product transitions and reduced pricing that were effected in the fourth quarter of 2007 , lower sales of ilife and iwork in their second quarter of availability , seasonally higher component costs , and a higher mix of indirect sales .
these factors are expected to be partially offset by higher sales of the company 2019s mac os x operating system due to the introduction of mac os x version 10.5 leopard ( 2018 2018mac os x leopard 2019 2019 ) that became available in october 2007 .
the foregoing statements regarding the company 2019s expected gross margin percentage are forward-looking .
there can be no assurance that current gross margin percentage will be maintained or targeted gross margin percentage levels will be achieved .
in general , gross margins and margins on individual products will remain under downward pressure due to a variety of factors , including continued industry wide global pricing pressures , increased competition , compressed product life cycles , potential increases in the cost and availability of raw material and outside manufacturing services , and a potential shift in the company 2019s sales mix towards products with lower gross margins .
in response to these competitive pressures , the company expects it will continue to take pricing actions with respect to its products .
gross margins could also be affected by the company 2019s ability to effectively manage product quality and warranty costs and to stimulate |
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dd4c55484 | american tower corporation and subsidiaries notes to consolidated financial statements 2014 ( continued ) to purchase 3924 and 911 shares , respectively .
in october 2005 , in connection with the exercise by mr .
gearon of his right to require the company to purchase his interest in atc south america , these options vested in full and were exercised .
upon exercise of these options , the holders received 4428 shares of atc south america , net of 1596 shares retained by the company to satisfy employee tax withholding obligations .
the 1596 shares retained by the company were treated as a repurchase of a minority interest in accordance with sfas no .
141 .
as a result , the company recorded a purchase price allocation adjustment of $ 5.6 million as an increase to intangible assets and a corresponding increase in minority interest as of the date of acquisition .
the holders had the right to require the company to purchase their shares of atc south america at their then fair market value six months and one day following their issuance .
in april 2006 , this repurchase right was exercised , and the company paid these holders an aggregate of $ 18.9 million in cash , which was the fair market value of their interests on the date of exercise of their repurchase right , as determined by the company 2019s board of directors with the assistance of an independent financial advisor .
12 .
impairments , net loss on sale of long-lived assets , restructuring and merger related expense the significant components reflected in impairments , net loss on sale of long-lived assets , restructuring and merger related expense in the accompanying consolidated statements of operations include the following : impairments and net loss on sale of long-lived assets 2014during the years ended december 31 , 2006 , 2005 and 2004 , the company recorded impairments and net loss on sale of long-lived assets ( primarily related to its rental and management segment ) of $ 3.0 million , $ 19.1 million and $ 22.3 million , respectively .
2022 non-core asset impairment charges 2014during the years ended december 31 , 2006 and 2005 respectively , the company recorded net losses associated with the sales of certain non-core towers and other assets , as well as impairment charges to write-down certain assets to net realizable value after an indicator of potential impairment had been identified .
as a result , the company recorded net losses and impairments of approximately $ 2.0 million , $ 16.8 million and $ 17.7 million for the years ended december 31 , 2006 , 2005 and 2004 , respectively .
the net loss for the year ended december 31 , 2006 is comprised net losses from asset sales and other impairments of $ 7.0 million , offset by gains from asset sales of $ 5.1 million .
2022 construction-in-progress impairment charges 2014for the years ended december 31 , 2006 , 2005 and 2004 , the company wrote-off approximately $ 1.0 million , $ 2.3 million and $ 4.6 million , respectively , of construction-in-progress costs , primarily associated with sites that it no longer planned to build .
restructuring expense 2014the following table displays activity with respect to the accrued restructuring liability for the years ended december 31 , 2004 , 2005 and 2006 ( in thousands ) : liability as of january 1 , expense payments liability december 31 , expense payments liability december 31 , expense payments liability december 31 .
| liability as of january 1 2004 | 2004 expense | 2004 cash payments | liability as of december 31 2004 | 2005 expense | 2005 cash payments | liability as of december 31 2005 | 2006 expense | 2006 cash payments | liability as of december 31 2006
--------------------------------------------------- | ------------------------------ | ------------ | ------------------ | -------------------------------- | ------------ | ------------------ | -------------------------------- | -------------- | ------------------ | --------------------------------
employee separations | $ 2239 | $ 823 | $ -2397 ( 2397 ) | $ 665 | $ 84 | $ -448 ( 448 ) | $ 301 | $ -267 ( 267 ) | $ -34 ( 34 ) | $ 0
lease terminations and other facility closing costs | 1450 | -131 ( 131 ) | -888 ( 888 ) | 431 | 12 | -325 ( 325 ) | 118 | -10 ( 10 ) | -108 ( 108 ) | 0
total | $ 3689 | $ 692 | $ -3285 ( 3285 ) | $ 1096 | $ 96 | $ -773 ( 773 ) | $ 419 | $ -277 ( 277 ) | $ -142 ( 142 ) | $ 0
the accrued restructuring liability is reflected in accounts payable and accrued expenses in the accompanying consolidated balance sheets as of december 31 , 2005 .
during the year ended december 31 , 2006 , the company |
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dd4be9ad6 | net revenue utility following is an analysis of the change in net revenue comparing 2013 to 2012 .
amount ( in millions ) .
| amount ( in millions )
--------------------------------------------- | ----------------------
2012 net revenue | $ 4969
retail electric price | 236
louisiana act 55 financing savings obligation | 165
grand gulf recovery | 75
volume/weather | 40
fuel recovery | 35
miso deferral | 12
decommissioning trusts | -23 ( 23 )
other | 15
2013 net revenue | $ 5524
the retail electric price variance is primarily due to : 2022 a formula rate plan increase at entergy louisiana , effective january 2013 , which includes an increase relating to the waterford 3 steam generator replacement project , which was placed in service in december 2012 .
the net income effect of the formula rate plan increase is limited to a portion representing an allowed return on equity with the remainder offset by costs included in other operation and maintenance expenses , depreciation expenses , and taxes other than income taxes ; 2022 the recovery of hinds plant costs through the power management rider at entergy mississippi , as approved by the mpsc , effective with the first billing cycle of 2013 .
the net income effect of the hinds plant cost recovery is limited to a portion representing an allowed return on equity on the net plant investment with the remainder offset by the hinds plant costs in other operation and maintenance expenses , depreciation expenses , and taxes other than income taxes ; 2022 an increase in the capacity acquisition rider at entergy arkansas , as approved by the apsc , effective with the first billing cycle of december 2012 , relating to the hot spring plant acquisition .
the net income effect of the hot spring plant cost recovery is limited to a portion representing an allowed return on equity on the net plant investment with the remainder offset by the hot spring plant costs in other operation and maintenance expenses , depreciation expenses , and taxes other than income taxes ; 2022 increases in the energy efficiency rider , as approved by the apsc , effective july 2013 and july 2012 .
energy efficiency revenues are offset by costs included in other operation and maintenance expenses and have no effect on net income ; 2022 an annual base rate increase at entergy texas , effective july 2012 , as a result of the puct 2019s order that was issued in september 2012 in the november 2011 rate case ; and 2022 a formula rate plan increase at entergy mississippi , effective september 2013 .
see note 2 to the financial statements for a discussion of rate proceedings .
the louisiana act 55 financing savings obligation variance results from a regulatory charge recorded in the second quarter 2012 because entergy gulf states louisiana and entergy louisiana agreed to share with customers the savings from an irs settlement related to the uncertain tax position regarding the hurricane katrina and hurricane rita louisiana act 55 financing .
see note 3 to the financial statements for additional discussion of the tax settlement .
entergy corporation and subsidiaries management's financial discussion and analysis |