(1) Of the total deferred costs, $1,896 million was current and $2,472 million was noncurrent at December 31, 2019 and $2,300 million was current and $2,676 million was noncurrent at December 31, 2018.
The amount of total deferred costs amortized during the year ended December 31, 2019 was $3,836 million and there were no material impairment losses incurred. Refer to note A, “Significant Accounting Policies,” for additional information on deferred costs to fulfill a contract and capitalized costs of obtaining a contract.

($ in millions)                        |        |
-------------------------------------- | ------ | ------
At December 31:                        | 2019   | 2018
Capitalized costs to obtain a contract | $  609 | $  717
Deferred costs to fulfill a contract   |        |
Deferred setup costs                   | 1,939  | 2,085
Other deferred fulfillment costs       | 1,820  | 2,173
Total deferred costs (1)               | $4,368 | $4,975

deferred costs $1,896 million current $2,472 million noncurrent December 31, 2019 $2,300 million $2,676 million noncurrent 2018.
 amortized 2019 $3,836 million no impairment losses. Accounting Policies deferred costs.
 December 31
 costs $ $ 717
 Deferred costs
 setup costs 1,939 2,085
 fulfillment costs 1,820 2,173
 costs $4,368 $4,975


14. Restructuring and Related Charges
Following is a summary of the Company’s restructuring and related charges (in thousands):
(1) Includes $21.5 million, $16.3 million and $51.3 million recorded in the EMS segment, $2.6 million, $16.6 million and $82.4 million recorded in the DMS segment and $1.8 million, $4.0 million and $26.7 million of non-allocated charges for the fiscal years ended August 31, 2019, 2018 and 2017, respectively. Except for asset write-off costs, all restructuring and related charges are cash settled.
(2) Fiscal year ended August 31, 2017, includes expenses related to the 2017 and 2013 Restructuring Plans.

                                           |         | Fiscal Year Ended August 31, |
------------------------------------------ | ------- | ---------------------------- | --------
                                           | 2019    | 2018                         | 2017(2)
Employee severance and benefit costs       | $16,029 | $16,269                      | $56,834
Lease costs                                | (41)    | 1,596                        | 3,966
Asset write-off costs                      | (3,566) | 16,264                       | 94,346
Other costs                                | 13,492  | 2,773                        | 5,249
Total restructuring and related charges(1) | $25,914 | $36,902                      | $160,395

. Restructuring Charges
 summary
 $21. 5 million $16. 3 million $51. million EMS $2. 6 million $16. $82. 4 million DMS $1. 8 million $4. $26. 7 million non-allocated 2019 2018 2017. asset write-off cash settled.
 August 2017 2017 2013 Restructuring Plans.
 Employee severance benefit costs $16,029 $16,269 $56,834
 Lease costs
 Asset write-off 16,264
 Other costs 13,492
 restructuring $25,914 $36,902 $160,395


5.2 Employee share plans (continued)
FY2019, FY2018 & FY2017 offer under LTI Plan
Each LTI Plan share is offered subject to the achievement of the performance measure, which is tested once at the end of the performance period. The LTI Plans will be measured against one performance measure – relative Total Shareholder Return (TSR). LTI Plan shares that do not vest after testing of the relevant performance measure, lapse without retesting.
The shares will only vest if a certain Total Shareholder Return (TSR) relative to the designated comparator group, being the ASX Small Ordinaries Index excluding mining and energy companies, is achieved during the performance period. In relation to the offer, vesting starts where relative TSR reaches the 50th Percentile.
At the 50th Percentile, 50% of LTI Plan shares will vest. All LTI Plan shares will vest if relative TSR is above the 75th Percentile. Between these points, the percentage of vesting increases on a straight-line basis.
Summary of Shares issued under the FY2017 LTI Plan
The following table illustrates the number of, and movements in, shares issued during the year:

                                           | 2019 NUMBER | 2018 NUMBER
------------------------------------------ | ----------- | -----------
Outstanding at the beginning of the period | 768,806     | 3,384,696
Granted during the period                  | -           | -
Forfeited during the period                | (768,806)   | (2,615,890)
Exercised during the period                | -           | -
Outstanding at the end of the period       | -           | 768,806

. Employee share plans
 FY2019 LTI Plan
 Each share subject to performance measure tested end period. Plans measured against Total Shareholder Return (TSR). shares vest after lapse without.
 vest if Return) ASX Small Ordinaries Index achieved during performance period. vesting starts TSR 50th Percentile.
 50th Percentile 50% LTI Plan shares vest. All vest if TSR above 75th Percentile. percentage vesting increases.
 Shares issued under FY2017 LTI Plan
 table movements shares issued year
 2019 2018
 Outstanding 768,806 3,384,696
 Granted
 Forfeited (768,806) (2,615,890)
 Exercised
 end,806


(a) Description of segments and principal activities (continued)  The Group also conducts operations in the United States of America (“United States”), Europe and other regions, and holds investments (including investments in associates, investments in joint ventures, FVPL and FVOCI) in various territories. The geographical information on the total assets is as follows:
As at 31 December 2019, the total non-current assets other than financial instruments and deferred tax assets located in Mainland China and other regions amounted to RMB311,386 million (31 December 2018: RMB282,774 million) and RMB136,338 million (31 December 2018: RMB65,057 million), respectively.
All the revenues derived from any single external customer were less than 10% of the Group’s total revenues during the years ended 31 December 2019 and 2018.

                                              | As at 31 December |
--------------------------------------------- | ----------------- | -----------
                                              | 2019              | 2018
                                              | RMB’Million       | RMB’Million
Operating assets                              |                   |
– Mainland China                              | 345,721           | 270,373
– Others                                      | 168,714           | 83,962
Investments                                   |                   |
– Mainland China and Hong Kong                | 289,491           | 254,992
– North America                               | 76,488            | 44,835
– Europe                                      | 29,707            | 37,451
– Asia excluding Mainland China and Hong Kong | 40,139            | 30,148
– Others                                      | 3,726             | 1,760
                                              | 953,986           | 723,521

Description segments activities Group conducts operations United Europe regions holds investments territories. geographical information total assets
 31 December 2019 non-current assets deferred tax assets Mainland China regions RMB311,386 million,774 million RMB136,338 million,057.
 revenues external customer less than 10% total revenues 31 December 2019 2018.
 31
 Operating assets
 Mainland China 345,721 270,373
 Others 168,714 83,962
 Investments
 Mainland China Hong Kong,491 254,992
 North America 76,488 44,835
 Europe 29,707 37,451
 Asia 40,139 30,148
 Others
 953,986 723,521


(5) Revenue Recognition
The following tables present our reported results under ASC 606 and a reconciliation to results using the historical accounting method:

                                                                           |                   | Year Ended December 31, 2018                                            |
-------------------------------------------------------------------------- | ----------------- | ----------------------------------------------------------------------- | ------------------------------------
                                                                           | Reported Balances | Impact of ASC 606                                                       | ASC 605 Historical Adjusted Balances
                                                                           |                   | (Dollars in millions, except per share amounts and shares in thousands) |
Operating revenue                                                          | $23,443           | 39                                                                      | 23,482
Cost of services and products (exclusive of depreciation and amortization) | 10,862            | 22                                                                      | 10,884
Selling,general and administrative                                         | 4,165             | 71                                                                      | 4,236
Interest expense                                                           | 2,177             | (9)                                                                     | 2,168
Income tax expense                                                         | 170               | (12)                                                                    | 158
Net loss                                                                   | (1,733)           | (33)                                                                    | (1,766)
BASIC AND DILUTED LOSS PER COMMON SHARE                                    |                   |                                                                         |
BASIC                                                                      | $(1.63)           | (0.03)                                                                  | (1.66)
DILUTED                                                                    | $(1.63)           | (0.03)                                                                  | (1.66)
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING                                 |                   |                                                                         |
BASIC                                                                      | 1,065,866         | -                                                                       | 1,065,866
DILUTED                                                                    | 1,065,866         | -                                                                       | 1,065,866

Revenue Recognition
 tables present results ASC 606 historical accounting
 Ended December 31, 2018
 Reported Balances Impact ASC 606 605 Historical Adjusted Balances
 millions share amounts thousands
 Operating revenue $23,443 23,482
 Cost services products depreciation amortization 10,862,884
 Selling administrative 4,165 4,236
 Interest expense 2,177 2,168
 Income tax expense 170
 Net loss (1,733) (1,766)
 LOSS PER COMMON SHARE
.
.
 WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING
 1,065,866


Contractual obligations and commitments
A summary of our principal contractual financial obligations and commitments at 31 March 2019 are set out below. In addition, information in relation to our participation in the current German spectrum licence auction and our commitments arising from the Group’s announcement on 9 May 2018 that it had agreed to acquire Liberty Global’s operations in Germany, the Czech Republic, Hungary and Romania (are set out in note 28 “Commitments”).
Notes: 1 This table includes obligations to pay dividends to non-controlling shareholders (see “Dividends from associates and to non-controlling shareholders” on page 160). The table excludes current and deferred tax liabilities and obligations under post employment benefit schemes, details of which are provided in notes 6 “Taxation” and 25 “Post employment benefits” respectively. The table also excludes the contractual obligations of associates and joint ventures.
2 See note 21 “Capital and financial risk management”.
3 See note 28 “Commitments”.
4 Primarily related to spectrum and network infrastructure.
5 Primarily related to device purchase obligations.

                                         |         |          |           |           | Payments due by period
---------------------------------------- | ------- | -------- | --------- | --------- | ----------------------
                                         |         |          |           |           | €m
Contractual obligations and commitments1 | Total   | < 1 year | 1–3 years | 3–5 years | >5 years
Financial liabilities2                   | 86,160  | 21,953   | 11,404    | 14,881    | 37,922
Operating lease commitments3             | 10,816  | 2,834    | 2,881     | 1,689     | 3,412
Capital commitments3,4                   | 3,012   | 1,514    | 1,274     | 173       | 51
Purchase commitments5                    | 8,460   | 4,091    | 2,616     | 689       | 1,064
Total                                    | 108,448 | 30,392   | 18,175    | 17,432    | 42,449

Contractual obligations commitments
 financial obligations 31 March 2019. German spectrum licence auction commitments 9 May 2018 Liberty operations Germany Czech Republic Hungary Romania note 28.
 includes obligations dividends non-controlling shareholders. excludes tax liabilities post employment benefit schemes notes 6 25. obligations associates joint ventures.
 note 21 “Capital financial risk.
 28.
 spectrum network infrastructure.
 device purchase obligations.
 Payments due
 Contractual obligations 1–3 3–5
 Financial 86,160  21,953  11,404  14,881  37,922
 Operating lease 10,816 2,834 2,881 1,689 3,412
 Capital 3,012 1,514 1,274
 Purchase 8,460 4,091 2,616 689 1,064
 108,448 30,392 18,175 17,432 42,449


Our fourth quarter 2019 net revenues amounted to $2,754 million, registering a sequential increase of 7.9%, 290 basis points above the mid-point of our guidance, with all product groups contributing to the growth. The sequential increase resulted from higher volumes of approximately 7% and an increase of approximately 1% in average selling prices, the latter entirely due to product mix, while selling prices remained substantially stable.
On a year-over-year basis, our net revenues increased by 4.0%. This increase was entirely due to an increase of approximately 6% in average selling prices, partially offset by an approximate 2% decrease in volumes. The average selling prices increase was entirely driven by improved product mix of approximately 9%, partially offset by lower selling prices of approximately 3%.

               | Three Months Ended       | Three Months Ended | Three Months Ended | % Variation | % Variation
-------------- | ------------------------ | ------------------ | ------------------ | ----------- | ----------------
               | December 31, 2019        | September 29, 2019 | December 31, 2018  | Sequential  | Year- Over- Year
               | (Unaudited, in millions) |                    |                    |             |
Net sales      | $ 2,750                  | $ 2,547            | $ 2,633            | 8.0%        | 4.5%
Other revenues | 4                        | 6                  | 15                 | (45.0)      | (77.4)
Net revenues   | $ 2,754                  | $ 2,553            | $ 2,648            | 7.9%        | 4.0%

fourth quarter 2019 revenues $2,754 million increase 7. 9% 290 points above guidance product groups. higher volumes 7% 1% average selling prices due product mix prices stable.
 year-over-year net revenues increased 4. 0%. 6% average selling prices offset 2% decrease volumes. increase improved product mix offset lower selling prices 3%.
 Months Ended Variation
 December 31, 2019 Year Year
 Net sales $ 2,750 $ 2,547  $ 2,633  8. 0% 4. 5%
 Other revenues.
 Net revenues $ 2,754 $ 2,553 $ 2,648 7. 9%.


NOTE 7 – LEASING
TORM has leases for the office buildings, some vehicles and other administrative equipment. With the exception of short-term leases and leases of low-value assets, each lease is reflected on the balance sheet as a right-of-use asset with a corresponding lease liability. The right-of-use assets are included in the financial statement line item in which the corresponding underlying assets would be presented if they were owned. Please refer to note 6.
As of 31 December 2019, TORM had recognized the following right-of-use assets:

USDm                                | Vessels and capitalized dry-docking | Land and buildings | Other plant and operating equipment
----------------------------------- | ----------------------------------- | ------------------ | -----------------------------------
Cost:                               |                                     |                    |
Balance as of 1 January             | 43.3                                | -                  | -
Adjustment on transition to IFRS 16 | -                                   | 9.9                | 0.3
Additions                           | 1.8                                 | 0.5                | 0.4
Disposals                           | -2.7                                | -                  | -0.1
Balance as of 31 December           | 42.4                                | 10.4               | 0.6
Depreciation:                       |                                     |                    |
Balance as of 1 January             | 13.4                                | -                  | -
Disposals                           | -2.7                                | -                  | -
Depreciation for the year           | 4.8                                 | 2.3                | 0.2
Balance as of 31 December           | 15.5                                | 2.3                | 0.2
Carrying amount as of 31 December   | 26.9                                | 8.1                | 0.4

7
 TORM leases office buildings vehicles administrative equipment. exception short-term low-value assets lease reflected balance sheet right-of-use asset liability. right-of-use assets included financial statement line. note 6.
 31 December 2019 TORM recognized right-use assets
 Vessels capitalized dry-docking Land buildings plant operating equipment
 Cost
 Balance 1 January 43. 3
 Adjustment transition IFRS 16 9.
 Additions.
 -2.
 Balance 31 December 42. 4 10.
 Depreciation
 Balance 1 January 13. 4
 -2.
 Depreciation year 4. 2.
 Balance 31 December 15. 2.
 Carrying amount 31 December 26. 9 8.


Note 2: Net Income Per Share
Basic net income per share is computed using the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed by adjusting the weighted-average number of common shares outstanding for the effect of dilutive potential common shares outstanding during the period. Potential common shares included in the diluted calculation consist of incremental shares issuable upon the exercise of outstanding stock options calculated using the treasury stock method.
The following table sets forth the calculation of basic and diluted net income per share (in thousands, except per share amounts):
For the years ended December 31, 2019 and 2018, options to purchase 200,000 and 200,000 shares of common stock, respectively, were not included in the computation of diluted net income per share because the effect would have been anti-dilutive.

Year Ended December 31,                      |        |
-------------------------------------------- | ------ | ------
                                             | 2019   | 2018
Net income                                   | $4,155 | $4,661
Weighted average common shares—basic         | 11,809 | 12,323
Effect of dilutive securities: stock options | 226    | 187
Weighted average common shares—diluted       | 12,035 | 12,510
Net income per share—basic                   | $0.35  | $0.38
Net income per share—diluted                 | $0.35  | $0.37

Net Income Per Share
 computed-average shares. Diluted dilutive potential common shares. shares incremental shares stock options treasury stock method.
 table calculation basic diluted net income per share
 years ended December 31, 2019 2018 options purchase 200,000,000 shares common stock not included diluted anti-dilutive.
 Year Ended December 31,
 2018
 Net income $4,155  $4,661
 Weighted average common shares—basic 11,809 12,323
 Effect dilutive securities stock options
 12,035 12,510
 Net income per share—basic $0. 35.
.


Net revenues by geographical region
Percentage of revenue by geographic region as presented below is based on the billing location of the customer.
Percentages may not add to 100% due to rounding.
The Americas include U.S., Canada, and Latin America; EMEA includes Europe, Middle East, and Africa; APJ includes Asia Pacific and Japan.

         | Fiscal Year |
-------- | ----------- | ----
         | 2019        | 2018
Americas | 64%         | 63%
EMEA     | 21%         | 22%
APJ      | 15%         | 16%

revenues
 billing location.
 not add 100% rounding.
 Americas U. S. Canada Latin America EMEA Europe Middle East Africa APJ Asia Pacific Japan.
 Americas 64%
 EMEA 21%
 APJ 15% 16%


Stock-Based Compensation
A summary of our stock-based compensation expense is as follows (in thousands):
(1) Amount for the year ended December 31, 2018 includes $4.1 million of accelerated stock-based compensation expense. In March 2018, as
a result of a suspension of the 2014 Purchase Plan due to our non-timely filing status, all unrecognized stock-based compensation expense
related to ESPP under the 2014 Purchase Plan was accelerated and recognized within the consolidated statement of operations.
As of December 31, 2019, we had $29.5 million of unrecognized stock-based compensation expense related to
unvested stock-based awards, including ESPP under our Amended 2014 Purchase Plan, which will be recognized
over a weighted-average period of 2.6 years.

                                                 |         | Years Ended December 31, |
------------------------------------------------ | ------- | ------------------------ | -------
                                                 | 2019    | 2018                     | 2017
Stock-based compensation by type of award:       |         |                          |
Stock options                                    | $648    | $1,353                   | $2,705
Stock awards                                     | 14,882  | 10,445                   | 11,421
Employee stock purchase rights(1)                | 999     | 5,240                    | 3,077
Total                                            | $16,529 | $17,038                  | $17,203
Stock-based compensation by category of expense: |         |                          |
Cost of revenue                                  | $1,500  | $1,602                   | $1,362
Sales and marketing                              | 5,765   | 5,667                    | 6,075
Research and development                         | 6,039   | 6,631                    | 6,343
General and administrative                       | 3,225   | 3,138                    | 3,423
Total                                            | $16,529 | $17,038                  | $17,203

Stock-Based Compensation
 summary expense
 December 31, 2018 $4. 1 million accelerated. March 2018
 2014 Purchase Plan unrecognized stock-based compensation expense
 accelerated recognized consolidated statement operations.
 December 31, 2019 $29. 5 million unrecognized expense
 unvested awards ESPP Amended 2014 Purchase Plan recognized
 2. 6 years.
 Years Ended December
 compensation type award
 Stock options $648 $1,353 $2,705
 Stock awards 14,882
 Employee stock purchase 5,240 3,077
 $16,529 $17,038
 category expense
 Cost revenue $1,500 $1,602
 Sales marketing
 Research development
 General administrative 3,225
 $16,529 $17,038


5. Property, Plant and Equipment
Property, plant and equipment consists of the following (in thousands):

                                               | August 31, |
---------------------------------------------- | ---------- | ----------
                                               | 2019       | 2018
Land and improvements                          | $146,719   | $144,136
Buildings                                      | 962,559    | 849,975
Leasehold improvements                         | 1,092,787  | 1,013,428
Machinery and equipment                        | 4,262,015  | 3,983,025
Furniture, fixtures and office equipment       | 209,257    | 192,243
Computer hardware and software                 | 671,252    | 601,955
Transportation equipment                       | 16,423     | 17,215
Construction in progress                       | 83,234     | 42,984
                                               | 7,444,246  | 6,844,961
Less accumulated depreciation and amortization | 4,110,496  | 3,646,945
                                               | $3,333,750 | $3,198,016

. Property Plant Equipment
 Land $146,719 $144,136
 Buildings 962,559 849,975
 1,092,787 1,013,428
 Machinery,262,015 3,983,025
 Furniture 209,257 192,243
 671,252
 Transportation
 Construction 83,234 42,984
 7,444,246 6,844,961
 amortization 4,110,496 3,646,945
 $3,333,750,198,016


Liquidity and Capital Resources
As of December 31, 2019, we had $19.5 million in cash and cash equivalents, of which $14.8 million was held outside the U.S. in certain of our foreign operations. If these assets are distributed to the U.S., we may be subject to additional U.S. taxes in certain circumstances. We have not provided for any repatriation taxes and currently have the intent to leave such cash and cash equivalents in the foreign countries. Cash and cash equivalents increased from $18.0 million as of December 31, 2018 primarily as a result of cash provided by operating activities, offset partially by cash used for repurchases of our common stock and our equity investment in WeekenGO. We expect that cash on hand will be sufficient to provide for working capital needs for at least the next twelve months.
Net cash provided by operating activities is net income adjusted for certain non-cash items and changes in assets and liabilities. Net cash provided by operating activities was $11.2 million for 2019, which consisted of net income of $4.2 million, adjustments for non-cash items of $3.8 million and a $3.2 million increase in cash from changes in operating assets and liabilities. Adjustments for non-cash items primarily consisted of a $1.3 million of depreciation and amortization expense on property and equipment, a $993,000 of stock-based compensation expense and $821,000 for our share of WeekenGO losses, amortization of basis differences and currency translation adjustment. The increase in cash from changes in operating assets and liabilities primarily consisted of a $3.1 million increase in accounts payable.
Net cash provided by operating activities was $5.3 million for 2018, which consisted of a net income of $4.7 million, adjustments for non-cash items of $2.5 million, offset partially a $1.9 million decrease in cash from changes in operating assets and liabilities. Adjustments for non-cash items primarily consisted of a $1.8 million of depreciation and amortization expense on property and equipment and a $915,000 of stock-based compensation expense. The decrease in cash from changes in operating assets and liabilities primarily consisted of a $1.5 million increase in accounts receivable.
Cash paid for income taxes, net of refunds received in 2019 and 2018, was $4.7 million and $4.3 million, respectively.
Net cash used in investing activities for 2019 and 2018 was $1.1 million and $3.7 million, respectively. The cash used in investing activities in 2019 was primarily due to $673,000 investment in WeekenGO and $474,000 in purchases of property and equipment. The cash used in investing activities in 2018 was primarily due to $3.1 million investment in WeekenGO and $752,000 in purchases of property and equipment, offset partially by $150,000 proceeds from sale of property and equipment.
Net cash used in financing activities for 2019 and 2018 was $9.1 million and $5.3 million, respectively. Net cash used in financing activities for the year ended December 31, 2019 was primarily due to $10.8 million used in repurchases of our common stock, offset partially by $1.7 million of proceeds from the issuance of common stock, net of tax paid for the net share settlement. Net cash used in financing activities for the year ended December 31, 2018 was primarily due to $5.3 million cash used in repurchases of our common stock.

Year Ended December 31,                                                       |         |
----------------------------------------------------------------------------- | ------- | -------
                                                                              | 2019    | 2018
(In thousands)                                                                |         |
Net cash provided by operating activities                                     | $11,236 | $5,317
Net cash used in investing activities                                         | (1,147) | (3,685)
Net cash used in financing activities                                         | (9,106) | (5,292)
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 266     | (880)
Net increase (decrease) in cash, cash equivalents and restricted cash         | $1,249  | (4,540)

Liquidity Capital Resources
 December 31, 2019 $19. 5 million cash equivalents $14. 8 million outside. foreign operations. distributed. taxes. repatriation taxes intent leave foreign. increased $18. 0 million December 31, 2018 operating activities repurchases common stock equity investment WeekenGO. cash working capital twelve months.
 Net cash activities adjusted non items assets liabilities. $11. 2 million 2019 income $4. 2 million adjustments non-cash $3. 8 million $3. 2 million increase assets liabilities. Adjustments $1. 3 million depreciation amortization property $993,000 stock-based compensation $821,000 WeekenGO losses amortization differences currency translation adjustment. increase $3. 1 million increase accounts payable.
 Net cash $5. 3 million 2018 income $4. 7 million adjustments non $2. 5 million $1. 9 million decrease. Adjustments $1. 8 million depreciation amortization $915,000 stock-based compensation. decrease $1.5 million increase accounts receivable.
 Cash taxes refunds 2019 2018 $4. 7 million $4. 3 million.
 Net cash investing 2019 2018 $1. 1 million $3. 7 million. 2019 $673,000 WeekenGO $474,000 purchases property equipment. 2018 $3. 1 million WeekenGO $752,000 $150,000 sale.
 Net cash financing 2019 2018 $9. 1 million $5. 3 million. due $10. 8 million repurchases common stock offset $1. 7 million proceeds issuance. $5. 3 million repurchases common stock.
 2019 2018
 Net cash operating activities $11,236 $5,317
 investing (1,147)
 financing (9,106
 exchange rate changes cash equivalents restricted cash 266 (880)
 Net increase $1,249 (4,540)


Stock Options
The following table summarizes stock option activity under the Company’s stock option plans during the fiscal years ended September 30, 2019, 2018, and 2017:
The Company recognized $0.7 million, $1.4 million, and $1.0 million in stock-based compensation expense related to outstanding stock options in the fiscal years ended September 30, 2019, 2018, and 2017, respectively. As of September 30, 2019, the Company had $2.0 million of unrecognized compensation expense related to outstanding stock options expected to be recognized over a weighted-average period of approximately three years.
Aggregate intrinsic value represents the value of the Company’s closing stock price on the last trading day of the fiscal period in excess of the weighted-average exercise price, multiplied by the number of options outstanding and exercisable. The total intrinsic value of options exercised during the fiscal years ended September 30, 2019, 2018, and 2017 was $11.1 million, $1.4 million, and $1.4 million, respectively. The per-share weighted-average fair value of options granted during the fiscal years ended September 30, 2019, 2018, and 2017 was $5.07, $4.56, and $4.28, respectively. The aggregate intrinsic value of options outstanding as of September 30, 2019 and 2018, was $4.9 million and $8.7 million, respectively.

                                  | Number of Shares | Weighted-Average Exercise Price Per Share | Weighted-Average Remaining Contractual Term (in Years)
--------------------------------- | ---------------- | ----------------------------------------- | ------------------------------------------------------
Outstanding at September 30, 2016 | 3,015,374        | $3.95                                     | 6.4
Granted                           | 147,800          | $7.06                                     |
Exercised                         | (235,514)        | $2.92                                     |
Canceled                          | (81,794)         | $3.59                                     |
Outstanding at September 30, 2017 | 2,845,866        | $4.21                                     | 5.4
Granted                           | 299,397          | $8.60                                     |
Exercised                         | (250,823)        | $2.96                                     |
Canceled                          | (88,076)         | $5.23                                     |
Outstanding at September 30, 2018 | 2,806,364        | $4.75                                     | 4.6
Granted                           | 409,368          | $9.59                                     |
Exercised                         | (1,384,647)      | $3.25                                     |
Canceled                          | (144,183)        | $6.62                                     |
Outstanding at September 30, 2019 | 1,686,902        | 7.00                                      | 5.4

 table summarizes activity years 2019 2018
 recognized $0. 7 million $1. 4 million $1. 0 million stock-based compensation expense options. 2019 $2. 0 million unrecognized compensation expense three years.
 Aggregate intrinsic value closing stock price multiplied options outstanding. total value options $11. 1 million $1. 4 million $1. 4 million. per-share-average value $5. 07 $4. 56 $4. 28,. aggregate intrinsic value options 2019 2018 $4. 9 million $8. 7 million.
 Number Shares Weighted-Average Exercise Price Per Share Remaining Contractual Term Years
 Outstanding September 30 2016 3,015,374 $3. 95.
 Granted 147,800 $7.
 (235,514) $2.
 (81,794) $3.
 September 30 2017 2,845,866 $4. 21.
 299,397 $8.
 $2.
Canceled (88,076) $5. 23
 September 30 2018 2,806,364 $4.
 409,368.
,384,647 $3.
,183).
 September 30 2019 1,686,902.


£1.5m (2018: £1.4m) of scheme assets have a quoted market price in an active market.
The actual return on plan assets was a gain of £5.5m (2018: £1.0m loss).
The amounts recognised in the Company Statement of Financial Position are determined as follows:

                                                                           | 2019   | 2018
-------------------------------------------------------------------------- | ------ | ------
                                                                           | £m     | £m
Fair value of scheme’s assets                                              | 59.5   | 56.4
Present value of funded scheme’s liabilities                               | (53.9) | (52.7)
Retirement benefit asset recognised in the Statement of Financial Position | 5.6    | 3.7
Related deferred tax                                                       | (0.9)  | (0.6)
Net pension asset                                                          | 4.7    | 3.1

£1. 5m (2018. 4m scheme assets quoted market price active market.
 return gain £5. 5m £1. 0m loss.
 amounts Company Statement Financial Position
 value assets 59. 56.
 value liabilities (53. 7)
 Retirement benefit 5. 6 3.
 deferred tax.
 pension asset 4. 7.


Consolidated Statements of Financial Position Data:
* Adjusted IFRS balances to reflect the impact of the full retrospective adoption of IFRS 15. See Note 2 of the notes to our consolidated financial statements for further details.

                               |            |                       | As of June 30, |          |
------------------------------ | ---------- | --------------------- | -------------- | -------- | --------
                               | 2019       | 2018                  | 2017           | 2016     | 2015
                               |            | (U.S. $ in thousands) |                |          |
                               |            | *As Adjusted          | *As Adjusted   |          |
Cash and cash equivalents      | $1,268,441 | $1,410,339            | $244,420       | $259,709 | $187,094
Short-term investments         | 445,046    | 323,134               | 305,499        | 483,405  | 30,251
Derivative assets              | 215,233    | 99,995                | 3,252          | —        | —
Working capital                | (287,597)  | 1,377,145             | 296,984        | 542,038  | 50,477
Total assets                   | 2,977,258  | 2,421,828             | 1,282,117      | 990,973  | 397,161
Deferred revenue               | 468,820    | 342,871               | 245,195        | 181,068  | 136,565
Derivative liabilities         | 855,079    | 207,970               | —              | —        | —
Exchangeable senior notes, net | 853,576    | 819,637               | —              | —        | —
Total liabilities              | 2,411,791  | 1,514,508             | 379,424        | 259,310  | 207,107
Share capital                  | 24,199     | 23,531                | 22,726         | 21,620   | 18,461
Total equity                   | 565,467    | 907,320               | 902,693        | 731,663  | 190,054

Financial
 Adjusted IFRS balances 15. Note 2.
 June 30
 2016 2015
.
 Cash equivalents $1,268,441 $1,410,339 $244,420 $259,709 $187,094
 Short-term investments 445,046 323,134 305,499 483,405
 Derivative assets 215,233 99,995
 Working capital (287,597) 1,377,145 296,984 542,038
 Total assets 2,977,258 2,421,828 1,282,117,973
 Deferred revenue 468,820 342,871,195
 Derivative liabilities 855,079 207,970
 Exchangeable senior notes 853,576 819,637
 Total liabilities 2,411,791 1,514,508 379,424 259
 Share capital 24,199 23,531
 Total equity 565,467 907,320 902,693


23. Investments continued
IFRS 9 was applied for the first time on 1 April 2018 and introduces new classifications for financial instruments, including investments. Under IAS 39, we classified investments as available-for-sale, loans and receivables, and fair value through profit or loss. On transition to IFRS 9 we have reclassified them as fair value through other comprehensive income, fair value through profit or loss, and amortised cost, as set out in note 1. The current year figures in the following table reflect the classifications under IFRS 9, and the prior year figures reflect the previous classifications under IAS 39.
Investments held at amortised cost consist of investments previously classified as loans and receivables and relate to money market investments denominated in sterling of £2,687m (2017/18: £416m, 2016/17: £35m), in US dollars of £26m (2017/18: £27m, 2016/17: £30m) in euros of £499m (2017/18: £nil, 2016/17: £nil) and in other currencies £2m (2017/18: £4m, 2016/17: £18m). They also include investments in liquidity funds of £2,522m (2017/18: £2,575m, 2016/17: £1,437m) held to collect contractual cash flows. In prior years these were classified as available-for-sale.

At 31 March                                   | 2019 £m | 2018 £m | 2017 £m
--------------------------------------------- | ------- | ------- | -------
Non-current assets                            | 48      | -       | -
Fair value through other comprehensive income | -       | 46      | 37
Available-for-sale                            | 6       | 7       | 7
Fair value through profit or loss             | 54      | 53      | 44
Current assets                                |         |         |
Fair value through other comprehensive income | -       | -       | -
Available-for-sale                            | -       | 2,575   | 1,437
Investments held at amortised cost            | 3,214   | -       | -
Loans and receivables                         | -       | 447     | 83
                                              | 3,214   | 3,022   | 1,520

. Investments
 IFRS 9 applied 1 April 2018 new classifications financial instruments investments. IAS 39 classified investments available-for-sale loans receivables fair value profit loss. transition IFRS 9 reclassified fair value income profit loss amortised cost note 1. current year figures reflect classifications IFRS 9 prior year figures classifications IAS 39.
 Investments amortised cost loans receivables money market investments sterling £2,687m US dollars £26m euros £499m other currencies £2m. investments liquidity funds £2,522m contractual cash flows. prior years classified available-for-sale.
 31 March 2019 2018 2017
 Non-current assets
 Fair value income
 Available-for-sale
 Fair value profit or loss
 Current assets
 Fair value income
 Available-for-sale 2,575 1,437
 Investments amortised cost 3,214
 Loans receivables


Inventories and Inventory Valuation
Inventories are stated at the lower of first-in, first-out (FIFO) cost or market value. Market value is based upon an estimated average selling price reduced by estimated costs of disposal. Should actual market conditions differ from the Company’s estimates, the Company’s future results of operations could be materially affected. Reductions in inventory valuation are included in Cost of revenue in the accompanying Consolidated Statements of Operations. The Company reviews inventory for excess quantities and obsolescence based on its best estimates of future demand, product lifecycle status and product development plans. The Company uses historical information along with these future estimates to reduce the inventory cost basis. Subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis. Prices anticipated for future inventory demand are compared to current and committed inventory values.
The components of inventories are as follows:

March 31,         |        |
----------------- | ------ | ------
(in thousands)    | 2019   | 2018
Raw materials     | $3,445 | $2,969
Finished goods    | 6,356  | 6,253
Total inventories | $9,801 | $9,222

Inventories Valuation
 first-in cost market value. value selling price reduced costs disposal. market conditions future results. Reductions inventory valuation included Cost revenue Consolidated Statements Operations. reviews inventory excess obsolescence future demand lifecycle development plans. uses historical information reduce inventory cost. changes cost basis. future inventory demand compared current values.
 components inventories
 March 31,
 2018
 Raw materials $3,445 $2,969
 Finished goods 6,356
 Total inventories $9,801 $9,222


Notes to Consolidated Financial Statements - (Continued) Fiscal Years Ended May 26, 2019, May 27, 2018, and May 28, 2017 (columnar dollars in millions except per share amounts)  During fiscal 2019, we recognized the following pre-tax expenses for the Pinnacle Integration Restructuring Plan:
Included in the above results are $163.5 million of charges that have resulted or will result in cash outflows and $4.7 million in non-cash charges.

                                                     | International | Pinnacle Foods | Corporate | Total
---------------------------------------------------- | ------------- | -------------- | --------- | ------
Other cost of goods sold                             | $—            | $3.7           | $—        | $3.7
Total cost of goods sold .                           | —             | 3.7            | —         | 3.7
Severance and related costs                          | 0.7           | 0.6            | 110.8     | 112.1
Accelerated depreciation                             | —             | —              | 4.7       | 4.7
Contract/lease termination .                         | —             | 0.8            | 0.3       | 1.1
Consulting/professional fees .                       | 0.2           | —              | 38.1      | 38.3
Other selling, general and administrative expenses . | 0.1           | —              | 8.2       | 8.3
Total selling, general and administrative expenses   | 1.0           | 1.4            | 162.1     | 164.5
Consolidated total                                   | $1.0          | $5.1           | $162.1    | $168.2

Consolidated Financial Statements Fiscal Years Ended May 26, 2019 27, 2018 28, 2017 millions share amounts 2019 recognized pre-tax expenses Pinnacle Integration Restructuring Plan
 $163. 5 million charges cash outflows $4. 7 million non-cash charges.
 Pinnacle Foods Corporate
 cost goods sold $3.
 Total cost goods sold. 3.
 related costs. 110. 112.
 Accelerated depreciation 4.
 Contract/lease termination.
 Consulting/professional fees. 38.
 selling general administrative expenses. 8.
 selling administrative expenses. 162. 164.
 Consolidated total $1. $5. $162. $168.


COMMON SHARES AND CLASS B SHARES
BCE’s articles of amalgamation provide for an unlimited number of voting common shares and non-voting Class B shares, all without par value. The common shares and the Class B shares rank equally in the payment of dividends and in the distribution of assets if BCE is liquidated, dissolved or wound up, after payments due to the holders of preferred shares. No Class B shares were outstanding at December 31, 2019 and 2018.
The following table provides details about the outstanding common shares of BCE.
In Q1 2018, BCE repurchased and canceled 3,085,697 common shares for a total cost of $175 million through a NCIB. Of the total cost, $69 million represents stated capital and $3 million represents the reduction of the contributed surplus attributable to these common shares. The remaining $103 million was charged to the deficit.
CONTRIBUTED SURPLUS
Contributed surplus in 2019 and 2018 includes premiums in excess of par value upon the issuance of BCE common shares and share-based compensation expense net of settlements.

                                                |      | 2019             |                | 2018             |
----------------------------------------------- | ---- | ---------------- | -------------- | ---------------- | --------------
                                                | NOTE | NUMBER OF SHARES | STATED CAPITAL | NUMBER OF SHARES | STATED CAPITAL
Outstanding, January 1                          |      | 898,200,415      | 20,036         | 900,996,640      | 20,091
Shares issued for the acquisition of AlarmForce | 34   | –                | –              | 22,531           | 1
Shares issued under employee stock option plan  | 28   | 4,459,559        | 251            | 266,941          | 13
Repurchase of common shares                     |      | –                | –              | (3,085,697)      | (69)
Shares issued under ESP                         |      | 1,231,479        | 75             | –                | –
Shares issued under DSP                         |      | 16,729           | 1              | –                | –
Outstanding, December 31                        |      | 903,908,182      | 20,363         | 898,200,415      | 20,036

COMMON SHARES CLASS B SHARES
 BCE’s articles amalgamation unlimited voting common non-voting Class B shares without par value. Class B rank equally dividends distribution assets if BCE liquidated dissolved. No Class B shares outstanding December 31, 2019 2018.
 table outstanding common shares BCE.
 Q1 2018 repurchased canceled 3,085,697 common shares $175 million. $69 million stated capital $3 million contributed surplus. remaining $103 million charged deficit.
 CONTRIBUTED SURPLUS
 includes premiums share-based compensation expense.
 NUMBER SHARES STATED CAPITAL
 898,200,415,996,640
 Shares acquisition AlarmForce 22,531
 Shares employee stock option plan 4,459,559 266,941
 Repurchase common shares (3,085,697)
 Shares ESP 1,231,479
 Shares DSP 16,729
December 31 903,908,182,363,200,415


Fiscal Year Ended 2019 and 2018 Revenues
* Adjusted IFRS balances to reflect the impact of the full retrospective adoption of IFRS 15. See Note 2 of the notes to our consolidated financial statements for further details.
Total revenues increased $329.1 million, or 37%, in the fiscal year ended June 30, 2019 compared to the fiscal year ended June 30, 2018. Growth in total revenues was attributable to increased demand for our products from both new and existing customers. Of total revenues recognized in the fiscal year ended June 30, 2019, over 90% was attributable to sales to customer accounts existing on or before June 30, 2018. Our number of total customers increased to 152,727 at June 30, 2019 from 125,796 at June 30, 2018.
Subscription revenues increased $223.3 million, or 54%, in the fiscal year ended June 30, 2019 compared to the fiscal year ended June 30, 2018. The increase in subscription revenues was primarily attributable to additional subscriptions from our existing customer base. As customers increasingly adopt cloud-based, subscription services and term-based licenses of our Data Center products for their business needs, we expect our subscription revenues to continue to increase at a rate higher than the rate of increase of our perpetual license revenues in future periods.
Maintenance revenues increased $68.0 million, or 21%, in the fiscal year ended June 30, 2019 compared to the fiscal year ended June 30, 2018. The increase in maintenance revenues was primarily attributable to growing renewal of software maintenance contracts from our customers related to our perpetual license software offerings.
Perpetual license revenues increased $10.4 million, or 13%, in the fiscal year ended June 30, 2019 compared to the fiscal year ended June 30, 2018. A substantial majority of the increase in perpetual license revenues was attributable to additional licenses to existing customers.
Other revenues increased $27.5 million, or 45%, in the fiscal year ended June 30, 2019 compared to the fiscal year ended June 30, 2018. The increase in other revenues was primarily attributable to an increase in revenue from sales of third-party apps through our Atlassian Marketplace.

                  | Fiscal Year Ended June 30, |                       |          |
----------------- | -------------------------- | --------------------- | -------- | --------
                  | 2019                       | 2018                  | $ Change | % Change
                  |                            | (U.S. $ in thousands) |          |
                  |                            | *As Adjusted          |          |
Subscription      | $633,950                   | $410,694              | $223,256 | 54%
Maintenance       | 394,526                    | 326,511               | 68,015   | 21
Perpetual license | 93,593                     | 83,171                | 10,422   | 13
Other             | 88,058                     | 60,602                | 27,456   | 45
Total revenues    | $1,210,127                 | $880,978              | $329,149 | 37

Fiscal Year Ended 2019 2018 Revenues
 Adjusted IFRS balances IFRS 15. See Note 2 consolidated financial statements details.
 Total revenues increased $329. 1 million 37% fiscal year June 30, 2019 2018. Growth attributable increased demand products new existing customers. 90% sales customer accounts before June 30 2018. customers increased 152,727 June 2019 from 125,796 2018.
 Subscription revenues increased $223. 3 million 54%. additional subscriptions existing customer base. cloud-based subscription term-based licenses Data Center expect subscription revenues increase higher than perpetual license revenues.
 Maintenance revenues increased $68. 0 million 21% June 2019 2018. attributable renewal software maintenance contracts perpetual license.
 Perpetual license revenues increased $10. 4 million 13% 2019 2018. majority additional licenses existing customers.
 Other revenues increased $27. 5 million 45%. attributable sales third-party apps Atlassian Marketplace.
 Fiscal Year June 30

 2019 2018 %
.
 Subscription $633,950 $410,694 $223,256 54%
 Maintenance 394,526 326,511 68,015
 Perpetual license 93,593 83,171
 88,058 60,602
 revenues $1,210,127 $880,978 $329,149


Net Investment in Direct Financing Leases and Sales-Type Leases
Teekay LNG owns a 70% ownership interest in Teekay BLT Corporation (or the Teekay Tangguh Joint Venture), which is a party to operating leases whereby the Teekay Tangguh Joint Venture leases two LNG carriers (or the Tangguh LNG Carriers) to a third party, which in turn leases the vessels back to the joint venture. The time charters for the two Tangguh LNG carriers are accounted for as direct financing leases. The Tangguh LNG Carriers commenced their time charters with their charterers in 2009.
In 2013, Teekay LNG acquired two 155,900-cubic meter LNG carriers, the WilPride and WilForce, from Norway-based Awilco LNG ASA (or Awilco) and chartered them back to Awilco on five- and four-year fixed-rate bareboat charter contracts (plus a one-year extension option), respectively, with Awilco holding a fixed-price purchase obligation at the end of the charters. The bareboat charters with Awilco were accounted for as direct financing leases.
However, in June 2017, Teekay LNG agreed to amend the charter contracts with Awilco to defer a portion of charter hire and extend the bareboat charter contracts and related purchase obligations on both vessels to December 2019. The amendments had the effect of deferring charter hire of between $10,600 per day and $20,600 per day per vessel from July 1, 2017 until December 2019, with such deferred amounts added to the purchase obligation amounts.
As a result of the contract amendments, both of the charter contracts with Awilco were reclassified as operating leases upon the expiry of their respective original contract terms in November 2017 and August 2018.
In September 2019, Awilco exercised its option to extend both charters from December 31, 2019 by up to 60 days with the ownership of both vessels transferring to Awilco at the end of this extension. In October 2019, Awilco obtained credit approval for a financing facility that would provide funds necessary for Awilco to satisfy its purchase obligation of the two LNG carriers.
As a result, both vessels were derecognized from the consolidated balance sheets and sales-type lease receivables were recognized based on the remaining amounts owing to Teekay LNG, including the purchase obligations. Teekay LNG recognized a gain of $14.3 million upon derecognition of the vessels for the year ended December 31, 2019, which was included in write-down and loss on sale of vessels in the Company's consolidated statements of loss (see Note 19). Awilco purchased both vessels in January 2020 (see Note 24(a)).
In addition, the 21-year charter contract for the Bahrain Spirit floating storage unit (or FSU) commenced in September 2018 and is accounted for as a direct finance lease. The following table lists the components of the net investments in direct financing leases and sales-type leases:
As at December 31, 2019, estimated minimum lease payments to be received by Teekay LNG related to its direct financing and sales-type leases in each of the next five succeeding fiscal years were approximately $324.7 million (2020), $64.2 million (2021), $64.2 million (2022), $64.0 million (2023), $64.3 million (2024) and an aggregate of $534.6 million thereafter. The leases are scheduled to end between 2020 and 2039.
As at December 31, 2018, estimated minimum lease payments to be received by Teekay LNG related to its direct financing leases in each of the next five years were approximately $63.9 million (2019), $64.3 million (2020), $64.2 million (2021), $64.2 million (2022), $64.0 million (2023) and an aggregate of $576.5 million thereafter.

                                                           | December 31, 2019 | December 31, 2018
---------------------------------------------------------- | ----------------- | -----------------
                                                           | $                 | $
Total minimum lease payments to be received                | 1,115,968         | 897,130
Estimated unguaranteed residual value of leased properties | 284,277           | 291,098
Initial direct costs and other                             | 296               | 329
Less unearned revenue                                      | (581,732)         | (613,394)
Total                                                      | 818,809           | 575,163
Less current portion                                       | (273,986)         | (12,635)
Long-term portion                                          | 544,823           | 562,528

Investment Direct Financing Sales-Type Leases
 Teekay LNG owns 70% Teekay BLT Corporation Tangguh Joint leases leases two LNG carriers third party leases vessels. time charters LNG carriers direct financing leases. charters 2009.
 2013, LNG acquired 155,900-cubic meter LNG carriers WilPride WilForce Awilco LNG chartered five- four-year fixed-rate charter contracts one-year extension Awilco fixed-price purchase obligation end. charters direct financing leases.
 June 2017 LNG contracts defer hire extend purchase obligations to December 2019. hire $10,600 $20,600 per day July 1 2017 December 2019 deferred amounts added purchase obligation amounts.
 contracts reclassified operating leases expiry November 2017 August 2018.
 September 2019 Awilco charters December 2019 60 days ownership vessels Awilco.October 2019 Awilco credit approval financing purchase two LNG carriers.
 vessels derecognized lease receivables recognized remaining Teekay LNG. recognized gain $14. 3 million derecognition December 31, 2019 included write-down loss sale statements. Awilco purchased vessels January 2020.
 21-year charter contract Bahrain Spirit floating storage unit commenced September 2018 direct finance lease. net investments financing sales leases
 December 31, 2019 estimated minimum lease payments Teekay LNG five years $324. 7 million $64. 2 million. (2023). 3 million (2024) $534. 6 million. leases end 2020 2039.
 December 31, 2018 minimum lease payments Teekay LNG $63. 9 million $64. 3 million. 2 million. 2. (2023) $576. 5 million.
 December 31, 2019 2018
 Total minimum lease payments 1,115,968
284,277 291,098
 unearned revenue (581,732) (613,394
 818,809 575,163
 (273,986),635
 544,823 562,528


Other Current Liabilities
The components of other current liabilities are included in the following table (in thousands):

                                | December 31, |
------------------------------- | ------------ | -------
                                | 2019         | 2018
Operating lease liabilities     | $15,049      | $ —
Vendor financed licenses        | 9,667        | 3,551
Royalties payable               | 6,107        | 11,318
Accrued interest                | 9,212        | 8,407
Other                           | 36,936       | 38,412
Total other current liabilities | $76,971      | $61,688

Liabilities
 Operating lease liabilities $15,049
 Vendor licenses 9,667 3,551
 Royalties 6,107 11,318
 Accrued interest 9,212 8,407
 36,936 38,412
 liabilities $76,971 $61,688


Net debt including IFRS 16 lease liabilities
A reconciliation between net debt and net debt including IFRS 16 lease liabilities is given below. A breakdown of the balances that are included within net debt is given within Note 24. Net debt excludes IFRS 16 lease liabilities to enable comparability with prior years.

                                       | 2019  | 2018
-------------------------------------- | ----- | -----
                                       | £m    | £m
Net debt                               | 295.2 | 235.8
IFRS 16 lease liabilities              | 38.9  | –
Net debt and IFRS 16 lease liabilities | 334.1 | 235.8

Net debt IFRS 16 lease liabilities
 reconciliation. breakdown balances Note 24. debt excludes IFRS 16 lease liabilities comparability prior years.
 2019 2018
 Net debt 295. 235.
 IFRS 16 lease liabilities 38.
 16. 235.


EBITDA and EBITDA Margin
The following tables set forth EBITDA (in millions) and EBITDA Margin by segment for the periods presented:
Software Solutions
EBITDA was $567.2 million in 2018 compared to $516.5 million in 2017, an increase of $50.7 million, or 10%, with an EBITDA Margin of 59.0%, an increase of 190 basis points from the prior year. The increase was primarily driven by incremental margins on revenue growth.
Data and Analytics
EBITDA was $39.5 million in 2018 compared to $38.4 million in 2017, an increase of $1.1 million, or 3%, with an EBITDA Margin of 25.6%, an increase of 30 basis points from the prior year. The EBITDA Margin increase was primarily driven by incremental margins on revenue growth.

                   | Year ended December 31, |        | Variance |
------------------ | ----------------------- | ------ | -------- | ---
                   | 2018                    | 2017   | $        | %
Software Solutions | $567.2                  | $516.5 | $50.7    | 10%
Data and Analytics | 39.5                    | 38.4   | 1.1      | 3%

EBITDA Margin
 tables EBITDA Margin
 Software Solutions
 EBITDA $567. 2 million 2018 $516. 5 million 2017 $50. 7 million 10% EBITDA Margin 59. 0% 190. driven incremental margins revenue growth.
 Data Analytics
 EBITDA $39. 5 million 2018 $38. 4 million 2017 $1. 1 million 3% EBITDA Margin 25. 6% 30. driven incremental margins revenue growth.
 December
 Solutions $567. $516. $50.
 Data Analytics.


Asia Pacific
Asia Pacific net revenues decreased $1.4 million in 2019 compared to 2018 (see “Revenues” above). Asia Pacific expenses decreased $203,000 from 2018 to 2019. This decrease was primarily due to a $503,000 decrease of salary expense, offset partially by a $303,000 increase in member acquisition costs.
Foreign currency movements relative to the U.S. dollar negatively impacted our local currency loss from our operations in Asia Pacific by approximately $136,000 for 2019. Foreign currency movements relative to the U.S. dollar positively impacted our local currency loss from our operations in Asia Pacific by approximately $127,000 for 2018.

Year Ended December 31,                   |          |
----------------------------------------- | -------- | --------
                                          | 2019     | 2018
(In thousands)                            |          |
Revenues                                  | $6,490   | $7,859
(Loss) from operations                    | $(7,488) | $(6,322)
(Loss) from operations as a % of revenues | (115)%   | (80)%

Pacific
 revenues decreased $1. 4 million 2019 2018. expenses decreased $203,000 2018 2019. due $503,000 decrease salary expense $303,000 increase member acquisition costs.
 Foreign currency movements. dollar impacted local currency loss $136,000 2019. currency. impacted loss $127,000 2018.
 Ended December 31,
 Revenues $6,490 $7,859
 (Loss operations $ $(6,322)


Operating Metrics
The following operating metrics are key performance indicators that we use to evaluate our business. The key drivers of changes in our operating metrics are presented in the order of significance.
Net bookings and In-game net bookings
We monitor net bookings as a key operating metric in evaluating the performance of our business because it enables an analysis of performance based on the timing of actual transactions with our customers and provides more timely indication of trends in our operating results. Net bookings is the net amount of products and services sold digitally or sold-in physically in the period, and includes license fees, merchandise, and publisher incentives, among others. Net bookings is equal to net revenues excluding the impact from deferrals. In-game net bookings primarily includes the net amount of downloadable content and microtransactions sold during the period, and is equal to in-game net revenues excluding the impact from deferrals.
Net bookings and in-game net bookings were as follows (amounts in millions):
Net bookings
The decrease in net bookings for 2019, as compared to 2018, was primarily due to:
a $572 million decrease in Blizzard net bookings primarily driven by (1) lower net bookings from Hearthstone and (2) overall lower net bookings from World of Warcraft expansion and in-game content sales, primarily due to World of Warcraft: Battle for Azeroth, which was released in August 2018, with no comparable release in 2019 (although net bookings from subscriptions increased due to the release of World of Warcraft Classic in August 2019);
a $239 million decrease in Activision net bookings primarily driven by (1) lower net bookings from the Destiny franchise (reflecting our sale of the publishing rights for Destiny to Bungie in December 2018) and (2) lower net bookings from Call of Duty franchise catalog titles, partially offset by net bookings from Sekiro: Shadows Die Twice, Crash Team Racing Nitro-Fueled, and Call of Duty: Mobile, which were new releases in March 2019, June 2019, and October 2019, respectively; and
a $55 million decrease in King net bookings primarily driven by lower net bookings from player purchases across various franchise titles, primarily driven by the Candy Crush franchise, partially offset by an increase in advertising net bookings.
In-game net bookings
The decrease in in-game net bookings for 2019, as compared to 2018, was primarily due to:
a $539 million decrease in Blizzard in-game net bookings primarily driven by (1) lower in-game net bookings from Hearthstone and (2) lower in-game net bookings from World of Warcraft, in part due to World of Warcraft: Battle for Azeroth;
a $167 million decrease in Activision in-game net bookings primarily due to lower in-game net bookings from the Destiny franchise, partially offset by in-game net bookings from Call of Duty: Mobile; and
a $131 million decrease in King in-game net bookings primarily due to lower in-game net bookings across various franchise titles, primarily driven by the Candy Crush franchise.

                     | For the Years Ended December 31, |        |
-------------------- | -------------------------------- | ------ | -------------------
                     | 2019                             | 2018   | Increase (Decrease)
Net bookings         | $6,388                           | $7,262 | $(874)
In-game net bookings | $3,366                           | $4,203 | $(837)

Operating Metrics
 key performance indicators business. key drivers significance.
 Net bookings In-game net bookings
 monitor net bookings analysis trends results. Net bookings products services sold digitally or physically includes license fees merchandise publisher incentives. equal to net revenues excluding deferrals. In-game net bookings includes downloadable content microtransactions sold equal to revenues.
 Net bookings in-game
 Net bookings
 decrease 2019 2018 due to
 $572 million decrease Blizzard net bookings lower bookings Hearthstone World of Warcraft expansion Battle for Azeroth 2018 no comparable release 2019 bookings increased World of Warcraft Classic
 $239 million decrease in Activision net bookings lower net bookings Destiny franchise lower Call of Duty offset by Sekiro: Shadows Die Twice Crash Team Racing Nitro-Fueled Call of Duty: Mobile March June October 2019
$55 million decrease King bookings lower player purchases Candy Crush offset increase advertising bookings.
-game bookings
 decrease 2019 2018 due
 $539 million decrease Blizzard bookings Hearthstone World of Warcraft
 $167 million decrease Activision bookings lower Destiny offset Call of Duty: Mobile
 $131 million decrease King bookings lower bookings Candy Crush.
 Years Ended December 31,
 2019 2018 Increase
 Net bookings $6,388  $7,262  $(874)
 In-game net bookings $3,366  $4,203  $(837)


Operating Expenses
The following table sets forth, for the periods indicated, the amount of operating expenses and their relative percentages of total net sales by the line items reflected in our consolidated statement of operations (dollars in thousands):

                                    | Fiscal 2019 |                               | Fiscal 2018 |
----------------------------------- | ----------- | ----------------------------- | ----------- | -----------------------------
                                    | Amount      | Percentage of total net sales | Amount      | Percentage of total net sales
                                    |             | (Dollars in thousands)        |             |
Research and development            | $117,353    | 8.2%                          | $132,586    | 7.0%
Selling, general and administrative | 272,257     | 19.0%                         | 293,632     | 15.4%
Impairment and other charges        | —           | —%                            | 766         | —%
Amortization of intangible assets   | 13,760      | 1.0%                          | 10,690      | 0.6%
Total operating expenses            | $403,370    | 28.2%                         | $437,674    | 23.0%

Operating Expenses
 table operating expenses percentages net sales items consolidated statement operations
 Fiscal 2019 2018
 Percentage
 Research development $117,353 8. 2% $132,586 7.
 Selling general administrative 272,257 19. 0% 293,632 15. 4%
 Impairment charges
 Amortization intangible assets 13,760 1. 10,690.
 operating expenses $403,370 28. 2% $437,674 23.


Fees Paid to our Independent Auditor
The following table sets forth the fees billed to us by Ernst & Young LLP for services in fiscal 2019 and 2018, all of which
were pre-approved by the Audit Committee.
(1) In accordance with the SEC’s definitions and rules, “audit fees” are fees that were billed to Systemax by Ernst & Young LLP for
the audit of our annual financial statements, to be included in the Form 10-K, and review of financial statements included in the
Form 10-Qs; for the audit of our internal control over financial reporting with the objective of obtaining reasonable assurance about
whether effective internal control over financial reporting was maintained in all material respects; for the attestation of management’s
report on the effectiveness of internal control over financial reporting; and for services that are normally provided by the auditor
in connection with statutory and regulatory filings or engagements.
(2) “Audit-related fees” are fees for assurance and related services that are reasonably related to the performance of the audit or
review of our financial statements and internal control over financial reporting, including services in connection with assisting
Systemax in our compliance with our obligations under Section 404 of the Sarbanes-Oxley Act and related regulations.
(3) Ernst & Young LLP did not provide any professional services for tax compliance, planning or advice in 2019 or 2018.
(4) Consists of fees billed for other professional services rendered to Systemax.

Fee Category           | 2019 ($)  | 2018 ($)
---------------------- | --------- | ---------
Audit fees (1)         | 1,196,000 | 1,257,000
Audit-related fees (2) | 0         | 15,000
Tax fees (3)           | 0         | 0
All other fees (4)     | 2,000     | 2,000
Total                  | 1,198,000 | 1,274,000

Fees Paid Independent Auditor
 table fees billed by Ernst & Young LLP for services 2019 2018
 pre-approved by Audit Committee.
 “audit billed to Systemax by Ernst & Young LLP
 audit annual financial statements Form 10-K
 Form 10-Qs audit internal control over financial reporting
 attestation
 report services
 statutory regulatory filings engagements.
 “Audit-related assurance services related to audit
 financial
 compliance obligations Section 404 Sarbanes-Oxley Act.
 Ernst & Young services for tax compliance planning advice 2019 2018.
 fees services.
 Fee 2019 2018
 Audit fees (1) 1,196,000 1,257,000
 Audit-related fees (2) 15,000
 Tax fees (3)
 All other fees (4)
 Total 1,198,000 1,274,000


23 Borrowings (continued)
The fair values of fixed rate borrowings and CMBS are assessed based on quoted market prices, and as such are categorised as Level 1 in the fair value hierarchy (see note 27 for definition). The fair values of unlisted floating rate borrowings are equal to their carrying values and are categorised as Level 2 in the fair value hierarchy.
The maturity profile of debt (excluding lease liabilities) is as follows:
Certain borrowing agreements contain financial and other conditions that, if contravened, could alter the repayment profile (further information is provided in financial covenants on pages 165 and 166)
At 31 December 2019 the Group had committed undrawn borrowing facilities of £238.5 million (2018: £274.2 million), maturing in 2021 and 2022. This includes £42.1 million of undrawn facilities in respect of development finance.

£m                                                            | 2019    | 2018
------------------------------------------------------------- | ------- | -------
Repayable within one year                                     | 65.8    | 46.7
Repayable in more than one year but not more than two years   | 901.8   | 30.5
Repayable in more than two years but not more than five years | 2,114.2 | 2,722.0
Repayable in more than five years                             | 1,569.6 | 2,155.9
                                                              | 4,651.4 | 4,955.1

Borrowings
 fixed rate borrowings CMBS assessed market prices Level 1 note 27. unlisted floating rate borrowings equal Level 2.
 maturity profile debt lease
 borrowing agreements conditions alter repayment profile financial covenants pages 165 166
 31 December 2019 Group committed undrawn borrowing facilities £238. 5 million (2018 £274. 2 maturing 2021 2022. includes £42. 1 million undrawn facilities development finance.
 Repayable one year 65. 46.
 two 901. 30.
 2,114. 2,722.
 five 1,569. 2,155.
 4,651.,955.


Free cash flow
We define free cash flow as net cash provided by (used in) operating activities less purchase of property and equipment. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can possibly be used for investing in our business and strengthening the balance sheet, but it is not intended to represent the residual cash flow available for discretionary expenditures. Free cash flow is not prepared in accordance with U.S. GAAP, and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with U.S. GAAP.
The following table presents a reconciliation of net cash provided by (used in) operating activities to free cash flow:
(1) Our adoption of ASU 2016-09 on January 1, 2017 resulted in excess tax benefits for share-based payments recorded as a reduction of income tax expense and reflected within operating cash flows, rather than recorded within equity and reflected within financing cash flows. We elected to adopt this new standard retrospectively, which impacted the presentation for all periods prior to the adoption date.

                                                        |            |          | Year Ended December 31, |            |
------------------------------------------------------- | ---------- | -------- | ----------------------- | ---------- | ----------
                                                        | 2019       | 2018     | 2017                    | 2016       | 2015
                                                        |            |          | (in thousands)          |            |
Net cash provided by (used in) operating activities (1) | $(156,832) | $113,207 | $64,241                 | $138,720   | $141,257
Purchase of property and equipment                      | (36,531)   | (52,880) | (89,160)                | (78,640)   | (30,566)
Free cash flow                                          | $(193,363) | $60,327  | $(24,919)               | $60,080    | $110,691
Net cash provided by (used in) investing activities     | $25,761    | $17,496  | $(28,718)               | $(392,666) | $(170,027)
Net cash provided by (used in) financing activities (1) | $(8,406)   | $1,287   | $4,635                  | $19,794    | $368,953

Free cash flow
 operating activities less purchase property equipment. liquidity measure information investors cash balance sheet not residual cash discretionary expenditures. not U. S. GAAP not.
 table reconciliation net cash operating activities free cash flow
 adoption ASU 2016-09 2017 excess tax benefits share-based payments income tax operating cash flows financing cash flows. standard retrospectively impacted presentation.
 December 31,
 2016 2015
 Net cash operating activities $(156,832)  $113,207  $64,241  $138,720 $141,257
 Purchase property equipment (36,531)  (52,880)  (89,160) (78,640) (30,566)
 Free cash flow $(193,363)  $60,327  $(24,919) $60,080 $110,691
 Net cash investing activities $25,761 $17,496 $(28,718) $(392,666) $(170,027)
cash financing,406,287 $4,635 $19,794 $368,953


Operating profit
Notes
1. Before exceptional items, acquisition related costs, acquired intangible asset amortisation and share-based payment amounting to $4.3 million in total (2018 $19.6 million).
2. Adjusted operating profit as a percentage of revenue in the period.
Adjusted operating profit increased by $15.8 million or 20.5 per cent to $92.9 million in 2019, compared with $77.1 million in 2018. Adjusted operating margin increased by 2.2 per cent to 18.4 per cent, from 16.2 per cent in 2018.
Reported operating profit was up by $31.1 million or 54.1 per cent to $88.6 million (2018 $57.5 million). Total adjusting items were lower in 2019 at $4.3 million, compared to $19.6 million in 2018, mainly due to exceptional items totalling $13.1 million charged last year (see below).

$ million                              | 2019  | Adjusted operating margin 1, 2 % | 2018   | Adjusted operating margin 1, 2 %
-------------------------------------- | ----- | -------------------------------- | ------ | --------------------------------
Networks & Security                    | 73.9  | 23.1                             | 56.4   | 19.8
Lifecycle Service Assurance            | 18.1  | 16.3                             | 17.4   | 15.4
Connected Devices                      | 9.5   | 13.1                             | 10.5   | 13.3
Corporate                              | (8.6) |                                  | (7.2)  |
Adjusted operating profit1             | 92.9  | 18.4                             | 77.1   | 16.2
Exceptional items                      | 0.5   |                                  | (13.1) |
Acquisition related costs              | (0.1) |                                  | –      |
Acquired intangible asset amortisation | (1.2) |                                  | (3.7)  |
Share-based payment                    | (3.5) |                                  | (2.8)  |
Reported operating profit              | 88.6  |                                  | 57.5   |

Operating profit
. exceptional items acquisition costs intangible amortisation share-based payment $4. 3 million (2018 $19. 6 million.
. Adjusted operating profit revenue.
 increased $15. 8 million. $92. 9 million 2019 $77. 1 million 2018. margin increased. 2 18. 4 per cent 16. 2 2018.
 profit $31. 1 million. $88. 6 million (2018 $57. 5 million. adjusting items lower 2019 $4. 3 million $19. 6 million 2018 exceptional items $13. 1 million last year.
 Adjusted operating margin 1, 2 %
 Networks Security 73.
 Lifecycle Service Assurance.
 Connected Devices.
.
 Adjusted operating. 18
 Exceptional items.
 Acquisition costs.
 Acquired intangible asset amortisation.
 Share-based payment.
 operating profit 88.


Write-offs of lease receivables and loan receivables were $15 million and $20 million, respectively, for the year ended December 31, 2018. Provisions for credit losses recorded for lease receivables and loan receivables were $14 million and $2 million, respectively, for the year ended December 31, 2018.
The average recorded investment of impaired leases and loans for Americas, EMEA and Asia Pacific was $138 million, $55 million and $73 million, respectively, for the year ended December 31, 2018. Both interest income recognized, and interest income recognized on a cash basis on impaired leases and loans were immaterial for the year ended December 31, 2018.

($ in millions)                                            |          |        |              |
---------------------------------------------------------- | -------- | ------ | ------------ | --------
At December 31, 2018:                                      | Americas | EMEA   | Asia Pacific | Total
Recorded investment:                                       |          |        |              |
Lease receivables                                          | $ 3,827  | $1,341 | $1,152       | $ 6,320
Loan receivables                                           | 6,817    | 3,675  | 2,489        | 12,981
Ending balance                                             | $10,644  | $5,016 | $3,641       | $19,301
Recorded investment, collectively evaluated for impairment | $10,498  | $4,964 | $3,590       | $19,052
Recorded investment, individually evaluated for impairment | $   146  | $   52 | $   51       | $   249
Allowance for credit losses                                |          |        |              |
Beginning balance at January 1, 2018                       |          |        |              |
Lease receivables                                          | $    63  | $    9 | $   31       | $   103
Loan receivables                                           | 108      | 52     | 51           | 211
Total                                                      | $   172  | $   61 | $   82       | $   314
Write-offs                                                 | (10)     | (2)    | (23)         | (35)
Recoveries                                                 | 0        | 0      | 2            | 2
Provision                                                  | 7        | 9      | 0            | 16
Other*                                                     | (11)     | (3)    | (4)          | (19)
Ending balance at December 31, 2018                        | $   158  | $   65 | $   56       | $   279
Lease receivables                                          | $    53  | $   22 | $    24      | $    99
Loan receivables                                           | $   105  | $   43 | $    32      | $   179
Related allowance, collectively evaluated for impairment   | $    39  | $   16 | $    5       | $     59
Related allowance, individually evaluated for impairment   | $   119  | $   49 | $    51      | $   219

Write-offs lease loan $15 $20 million 31, 2018. credit losses $14 million $2 million.
 average investment impaired leases Americas EMEA Asia Pacific $138 million $55 million $73 million. interest immaterial.
 December 31, Americas EMEA Asia Pacific
 Lease receivables $ 3,827 $1,341 $1 6,320
 Loan receivables 3,675 2,489 12,981
 balance $10,644  $5,016 $3,641 $19,301
 impairment $10,498 $4,964 $3,590 $19,052
 $ 146 $ 52 $ 51 249
 Allowance credit losses
 balance January 1, 2018
 Lease receivables $ 63 $ 9 $ 31 103
 Loan receivables 108 52 51 211
 $ 172 $ 61 $ 82 314
 Write-offs
 Recoveries
Provision 7 9 16
 (11) (19)
 balance December 31, 2018 $ 158 65 56 279
 Lease $ 53 22 24 99
 Loan $ 105 43 32 179
 impairment $ 39 16 5 59
 $ 119 49 51 219


The Company estimates the fair values of stock options using the Black-Scholes option-pricing model on the date of grant.For the years ended December 31, 2019 and 2018, the assumptions used in the Black-Scholes option pricing model, which was used to estimate the grant date fair value per option, were as follows:
The risk-free interest rate is the United States Treasury rate for the day of the grant having a term equal to the life of the equity instrument. The volatility is a measure of the amount by which the Company’s share price has fluctuated or is expected to fluctuate; the Company used its common stock volatility along with the average of historic volatilities of comparative companies. The dividend yield is zero as the Company has not made any dividend payment and has no plans to pay dividends in the foreseeable future. The Company determines the expected term of its stock option awards by using the simplified method, which assumes each vesting tranche of the award has a term equal to average of the contractual term and the vesting period.
As of December 31, 2019, total compensation cost not yet recognized related to unvested stock options was approximately $0.8 million, which is expected to be recognized over a weighted-average period of 2.3 years.

                                                                 | 2019            | 2018
---------------------------------------------------------------- | --------------- | ---------------
                                                                 | Employee Grants | Employee Grants
Weighted-average Black-Scholes option pricing model assumptions: |                 |
Volatility                                                       | 73.01%          | 82.00%
Expected term (in years)                                         | 6               | 6
Risk-free rate                                                   | 2.22%           | 2.24%
Expected dividend yield                                          | 0.0%            | 0.0%
Weighted average grant date fair value per share                 | $2.10           | $2.22

Company estimates values stock options Black-Scholes option-pricing model date grant. years December 31, 2019 2018 assumptions
 risk-free interest rate United States Treasury rate grant term equal life equity instrument. volatility share price common stock volatility average historic volatilities. dividend yield zero no plans. determines expected term stock option awards simplified method vesting tranche term equal contractual term vesting period.
 December 31, 2019 compensation cost unvested stock options approximately $0. 8 million expected recognized 2. 3 years.
-average Black-Scholes option pricing model assumptions
 Volatility 73. 01%.
 Expected term years 6
 Risk-free rate 2. 22%.
 Expected dividend yield.
 average grant date fair value per share $2.


1 Interest on borrowings includes interest on short-term borrowings and on long-term debt. 2 See “Accounting Policies” for more information.
The 6% increase in finance costs this year was a result of: • interest on lease liabilities as a result of our adoption of IFRS 16; and • higher outstanding debt as a result of our debt issuances in April 2019, in large part to fund our acquisition of 600 MHz spectrum licences (see “Managing Our Liquidity and Financial Resources”); partially offset by • a $21 million loss on discontinuation of hedge accounting on certain bond forward derivatives recognized in 2018.
Interest on borrowings Interest on borrowings increased this year as a result of the net issuance of senior notes throughout the year, partially offset by a higher proportion of borrowings under our lower-interest US CP program compared to 2018. See “Managing Our Liquidity and Financial Resources” for more information about our debt and related finance costs.
Loss on repayment of long-term debt This year, we recognized a $19 million loss (2018 – $28 million loss) on repayment of long-term debt, reflecting the payment of redemption premiums associated with our redemption of $900 million (2018 – US$1.4 billion) of 4.7% senior notes in November 2019 that were otherwise due in September 2020 (2018 – 6.8% senior notes in April 2018 that were otherwise due in August 2018).
Foreign exchange and change in fair value of derivative instruments We recognized $79 million in net foreign exchange gains in 2019 (2018 – $136 million in net losses). These gains and losses were primarily attributed to our US dollar-denominated commercial paper (US CP) program borrowings.
These foreign exchange gains (2018 – losses) were offset by the $80 million loss related to the change in fair value of derivatives (2018 – $95 million gain) that was primarily attributed to the debt derivatives, which were not designated as hedges for accounting purposes, we used to offset the foreign exchange risk related to these US dollar-denominated borrowings.
During the year ended December 31, 2018, we determined that we would no longer be able to exercise certain ten-year bond forward derivatives within the originally designated time frame. Consequently, we discontinued hedge accounting on those bond forward derivatives and reclassified a $21 million loss from the hedging reserve within shareholders’ equity to finance costs (recorded in “change in fair value of derivative instruments”). We subsequently extended the bond forwards to May 31, 2019, with the ability to extend them further, and redesignated them as effective hedges. During the year ended December 31, 2019, we exercised our remaining bond forwards.
See “Managing Our Liquidity and Financial Resources” for more information about our debt and related finance costs.

FINANCE COSTS                                      | Years ended December 31 |      |
-------------------------------------------------- | ----------------------- | ---- | ----
(In millions of dollars)                           | 2019                    | 2018 | %Chg
Interest on borrowings 1                           | 746                     | 709  | 5
Interest on post-employment benefits liability     | 11                      | 14   | (21)
Loss on repayment of long-term debt                | 19                      | 28   | (32)
(Gain) loss on foreign exchange                    | (79)                    | 136  | n/m
Change in fair value of derivative instruments     | 80                      | (95) | n/m
Capitalized interest                               | (19)                    | (20) | (5)
Other                                              | 21                      | 21   | -
Finance costs before interest on lease liabilities | 779                     | 793  | (2)
Interest on lease liabilities 2                    | 61                      | -    | n/m
Total finance costs                                | 840                     | 793  | 6

Interest borrowings includes short long-term debt. “Accounting Policies”.
 6% increase finance costs lease liabilities IFRS 16 higher outstanding debt issuances April 2019 acquisition 600 MHz spectrum licences offset $21 million loss discontinuation hedge accounting bond derivatives.
 Interest borrowings increased net issuance senior notes offset higher borrowings lower-interest US CP program. Liquidity Financial costs.
 Loss repayment long-term debt $19 million loss $28 million repayment-term debt redemption premiums redemption $900 million$1. 4 billion 4. 7% senior notes November 2019 due September 2020 6. 8% April 2018 August.
 Foreign exchange fair value derivative instruments $79 million net exchange gains 2019 (2018 $136 million losses. US dollar-denominated commercial paper) program borrowings.
 offset $80 million loss change fair value derivatives $95 million debt derivatives risk.
December 31, 2018 ten-year bond forward derivatives. discontinued hedge accounting reclassified $21 million loss finance costs. extended bond forwards to May 31, 2019 redesignated effective hedges. December 31, 2019 exercised remaining bond forwards.
 Liquidity Financial Resources” debt finance costs.
 FINANCE COSTS ended December 31
 millions 2019 2018
 Interest on borrowings 746  709
 Interest post-employment benefits
 Loss repayment long-term debt 19 28
 loss foreign exchange 136
 Change fair value derivative instruments
 Capitalized interest
 Finance costs before interest lease liabilities 779 793
 Interest lease liabilities 61
 Total finance costs 840  793


1.2 Data Centres
Note: 1. Due to its business nature, the significant air emissions of the Group are GHG emissions, arising mainly from fuels and purchased electricity produced from fossil fuels.
2. The Group’s GHG inventory includes carbon dioxide, methane and nitrous oxide. GHG emissions data for the year ended 31 December 2019 is presented in carbon dioxide equivalent and is calculated based on the “2017 Baseline Emission Factors for Regional Power Grids in China for CDM and CCER Projects” issued by the Ministry of Ecology and Environment of China, and the “2006 IPCC Guidelines for National Greenhouse Gas Inventories” issued by the Intergovernmental Panel on Climate Change (IPCC).
3. Diesel is consumed by backup power generators.
4. Hazardous waste produced by the Group’s office buildings mainly includes waste toner cartridge and waste ink cartridge from printing equipment. Waste toner cartridge and waste ink cartridge are centralised and disposed of by printing suppliers. Such data covers all office buildings of the Group in Mainland China.
5. Non-hazardous waste produced by the Group’s office buildings mainly includes domestic waste and non-hazardous office waste. Domestic waste is disposed of by the property management companies and kitchen waste recycling vendors, and its data is not available, therefore estimation of domestic waste is made with reference to “Handbook on Domestic Discharge Coefficients for Towns in the First Nationwide Census on Contaminant Discharge” published by the State Council. Non-hazardous office waste is centralised for disposal by vendors; hence such data covers all office buildings of the Group in Mainland China.
6. Hazardous waste produced by the Group’s data centres mainly includes waste lead-acid accumulators. Waste lead-acid accumulators are disposed of by qualified waste recycling vendors.
7. Non-hazardous waste produced by the Group’s data centres mainly includes waste servers and waste hard drives. Waste servers and destroyed waste hard drives are centralised and recycled by waste recycling vendors. Such data covers all the Group’s data centres.

Indicators                                    | For the year ended 31 December |
--------------------------------------------- | ------------------------------ | ----------
                                              | 2019                           | 2018
Total GHG emissions (Scopes 1 and 2) (tonnes) | 743,287.01                     | 612,521.16
Direct GHG emissions (Scope 1) (tonnes)       | 316.35                         | 36.76
Including: Diesel (tonnes)                    | 316.35                         | 36.76
Indirect GHG emissions (Scope 2) (tonnes)     | 742,970.66                     | 612,484.40
Including: Purchased electricity (tonnes)     | 742,970.66                     | 612,484.40
Hazardous waste (tonnes)                      | 8.00                           | –
Non-hazardous waste (tonnes)                  | 1,811.27                       | 1,350.76

. Data Centres
. business air emissions Group GHG emissions from electricity fossil fuels.
. GHG inventory includes carbon methane nitrous oxide. emissions 31 December 2019 carbon equivalent calculated Baseline Emission Factors Regional Power Grids China Ministry IPCC Guidelines National Greenhouse Gas Inventories”.
. Diesel consumed backup power generators.
. Hazardous waste includes toner cartridge ink cartridge printing equipment. disposed printing suppliers. covers office buildings Mainland China.
. Non-hazardous waste domestic non. disposed property management companies kitchen waste recycling vendors estimation “Handbook Domestic Discharge Coefficients State. Non-hazardous office waste centralised disposal vendors covers all office buildings Mainland China.
. Hazardous waste lead-acid accumulators. disposed waste recycling vendors.
. Non-hazardous waste waste servers hard drives.Waste servers hard drives recycled vendors. centres.
 year 31 December
 GHG emissions 1 2) 743,287. 612,521.
 Direct GHG emissions 316. 36.
 Diesel.
 Indirect GHG emissions 2),970. 612,484.
 Purchased electricity,970. 612,484.
 Hazardous waste 8.
 Non-hazardous waste 1,811. 27 1,350.


d) Transaction with other related parties:
Net revenues/(expenses): The transactions with other related parties for the years ended December 31, 2019, 2018 and 2017 consisted of the following:
(i) The Cool Pool - On July 8, 2019 GasLog's vessel charter contracts had concluded and withdrew their participation from the Cool Pool. Following Gaslog's departure, we assumed sole responsibility for the management of the Cool Pool and consolidate the Cool Pool. From point of consolidation, the Cool Pool ceased to be a related party.
(ii) Magni Partners - Tor Olav Trøim is the founder of, and partner in, Magni Partners (Bermuda) Limited, a privately held Bermuda company, and is the ultimate beneficial owner of the company. Receivables and payables from Magni Partners comprise primarily of the cost (without mark-up) or part cost of personnel employed by Magni Partners who have providedadvisory and management services to Golar. These costs do not include any payment for any services provided by Tor Olav Trøim himself.
iii) Borr Drilling - Tor Olav Trøim is the founder, and director of Borr Drilling, a Bermuda company listed on the Oslo and NASDAQ stock exchanges. Receivables comprise primarily of management and administrative services provided by our Bermuda corporate office.
iv) 2020 Bulkers - 2020 Bulkers is a related party by virtue of common directorships. Receivables comprise primarily of management and administrative services provided by our Bermuda corporate office.

(in thousands of $) | 2019   | 2018    | 2017
------------------- | ------ | ------- | ------
The Cool Pool (i)   | 39,666 | 151,152 | 59,838
Magni Partners (ii) | (858)  | (375)   | (260)
Borr Drilling (iii) | 542    | —       | —
2020 Bulkers (iv)   | 265    | —       | —
Total               | 39,615 | 150,777 | 59,578

Transaction related parties
 Net revenues transactions December 31, 2019 2018 2017
 Cool Pool July 8, 2019 GasLog's vessel charter contracts participation Cool Pool. assumed responsibility management. ceased related party.
 Magni Partners Tor Olav Trøim founder partner Magni Partners (Bermuda) Limited company ultimate beneficial owner. Receivables payables personnel management services. payment services Tor Olav Trøim.
 Borr Drilling Trøim founder director Drilling Bermuda company Oslo NASDAQ. Receivables management administrative services Bermuda office.
 2020 Bulkers related party. Receivables management administrative services Bermuda office.
 2019 2018 2017
 Cool Pool 39,666 151,152 59,838
 Magni Partners (858) (375)
 Borr Drilling 542
 2020 Bulkers 265
 Total 39,615 150,777 59,578