Income Taxes
nm - not meaningful
For fiscal 2018, the effective tax rate was different than the statutory rate due primarily to the impact of the Tax Act reform. The Company recorded a benefit of approximately $3.3 million resulting from the effect of a reduction in the deferred rate and the ability to offset indefinite lived deferred tax liabilities with certain deferred tax assets, recognition of net operating losses as deferred tax assets, which were offset by increases in the valuation allowance, certain foreign and state tax effects including a benefit of $0.4 million related to a settlement with the California Franchise Tax Board and other U.S. permanent book to tax differences. At March 31, 2018, we had $198.7 million of a federal net operating loss carryforward that expires, if unused, in fiscal years 2031 to 2038.
For fiscal 2017, the effective tax rate was different than the statutory rate due primarily to the recognition of net operating losses as deferred tax assets, which were offset by increases in the valuation allowance, state taxes and other U.S. permanent book to tax differences.
Although the timing and outcome of tax settlements are uncertain, it is reasonably possible that during the next 12 months a reduction in unrecognized tax benefits may occur in the range of zero to $0.1 million of tax and zero to $0.2 million of interest based on the outcome of tax examinations and as a result of the expiration of various statutes of limitations. We are routinely audited; due to the ongoing nature of current examinations in multiple jurisdictions, other changes could occur in the amount of gross unrecognized tax benefits during the next 12 months which cannot be estimated at this time.
Because of our losses in prior periods, we have recorded a valuation allowance offsetting substantially all of our deferred tax assets. The ultimate realization of deferred tax assets generated prior to Tax Act reform depends on the generation of future taxable income during the periods in which those temporary differences are deductible. Because of our losses in prior periods, management believes that it is more-likely-than-not that we will not realize the benefits of these deductible differences.

                             | Year ended March 31, |        | (Unfavorable) favorable |
---------------------------- | -------------------- | ------ | ----------------------- | --
(Dollars in thousands)       | 2018                 | 2017   | $                       | %
Income tax (benefit) expense | $ (3,251)            | $ 236  | $ 3,487                 | nm
Effective tax rate           | (28.0)%              | (2.1)% |                         |

Income Taxes
 fiscal 2018 effective tax rate different Tax Act reform. Company recorded benefit $3. 3 million reduction deferred rate deferred tax liabilities net operating losses deferred tax assets offset valuation allowance foreign state tax effects benefit $0. 4 million settlement California Franchise Tax Board. tax differences. March 31, 2018 $198. 7 million federal net operating loss carryforward expires 2031 to 2038.
 2017 effective tax rate different net operating losses deferred tax assets offset valuation allowance state taxes. tax differences.
 tax settlements uncertain reduction unrecognized tax benefits zero to $0. 1 million tax zero to $0. 2 million interest tax examinations expiration statutes of limitations. routinely audited changes unrecognized tax benefits.
 valuation allowance deferred tax assets. realization deferred tax assets reform depends future taxable income.losses management believes realize benefits deductible differences.
 Year ended March 31, favorable
 thousands 2018 2017
 Income tax expense $ (3,251) 3,487
 Effective tax rate (28.)% (2. 1)%


7 Revenue
Revenue recognised in the Consolidated Statement of Profit or Loss is analysed as follows:

                    | Year-ended 31 March 2019 | Year-ended 31 March 2018 Restated See note 2
------------------- | ------------------------ | --------------------------------------------
Revenue by Product: | $M                       | $M
Network             | 328.5                    | 316.5
Enduser             | 348.4                    | 291.8
Other               | 33.7                     | 30.7
Total               | 710.6                    | 639.0

Revenue
 Consolidated Statement Profit Loss
-ended 31 March 2019 March 2018
 Revenue Product
 328. 5 316.
 348. 4 291. 8
 33. 7 30.
 710. 6 639.


COHERENT, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In thousands)
(1) Reclassification adjustments were not significant during fiscal 2019, 2018 and 2017.
(2) Tax benefits of $(5,161), $0 and $(326) were provided on translation adjustments during fiscal 2019, 2018 and 2017, respectively.
(3) Tax benefits of $0, $(2) and $(1,876) were provided on changes in unrealized losses on available-for-sale securities during fiscal 2019, 2018 and 2017, respectively.
(4) Tax expenses (benefits) of $(2,371), $202 and $1,747 were provided on changes in defined benefit pension plans during fiscal 2019, 2018 and 2017, respectively.

                                                                               |                   | Year Ended        |
------------------------------------------------------------------------------ | ----------------- | ----------------- | -----------------
                                                                               | September 28,2019 | September 29,2018 | September 30,2017
Net income                                                                     | $53,825           | $247,358          | $207,122
Other comprehensive income (loss):(1)                                          |                   |                   |
Translation adjustment, net of taxes(2)                                        | (32,609)          | (18,065)          | 24,923
Changes in unrealized losses on available-for-sale securities, net of taxes(3) | —                 | (4)               | (3,330)
Defined benefit pension plans, net of taxes(4)                                 | (6,560)           | 996               | 3,613
Other comprehensive income (loss), net of tax                                  | (39,169)          | (17,073)          | 25,206
Comprehensive income                                                           | $14,656           | $230,285          | $232,328

. STATEMENTS COMPREHENSIVE INCOME
 Reclassification adjustments 2019 2018.
 Tax benefits $(5 $0 $(326) translation adjustments.
 Tax benefits $0 $(2) $(1,876) unrealized losses securities.
 Tax expenses $(2 $202 $1,747 defined benefit pension plans.
 September 28,2019 29,2018 30,2017
 Net income $53,825 $247,358 $207,122
 comprehensive income
 Translation adjustment net (32,609) (18,065) 24,923
 unrealized losses securities
 Defined benefit pension plans
 income net tax (39,169 (17 25
 Comprehensive income $14,656 $230,285 $232,328


The following table sets forth information known to us with respect to the beneficial ownership of our common shares as of (i) April 12, 2020, our most recent record date, and (ii) as of certain record dates in each of the preceding three years, for (1) the stockholders known by us to beneficially own more than 2% of our common shares and (2) all directors and executive officers as a group. Beneficial ownership is determined in accordance with SEC rules.
(1) 36.49% owned by United Microelectronics Corporation as of March 31, 2020.
None of our major stockholders have different voting rights from those of our other stockholders. To the best of our knowledge, we are not directly or indirectly controlled by another corporation, by any foreign government or by any other natural or legal person severally or jointly.
For information regarding our common shares held or beneficially owned by persons in the United States, see “Item 9. The Offer and Listing—A. Offer and Listing Details—Market Price Information for Our American Depositary Shares” in this annual report.

                                            | As of April 14, 2018                       | As of April 14, 2019                       | As of April 12, 2020                       | As of April 12, 2020
------------------------------------------- | ------------------------------------------ | ------------------------------------------ | ------------------------------------------ | ------------------------------------------
                                            | Number of common shares beneficially owned | Number of common shares beneficially owned | Number of common shares beneficially owned | Number of common shares beneficially owned
Name of Beneficial Owner                    |                                            |                                            |                                            |
Hsun Chieh Investment Co., Ltd. (1)         | 3.50%                                      | 3.64%                                      | 441,371,000                                | 3.75%
Silicon Integrated Systems Corp.            | 2.50%                                      | 2.35%                                      | 285,380,424                                | 2.42%
Directors and executive officers as a group | 6.32%                                      | 6.67%                                      | 832,664,416                                | 7.07%

table information beneficial ownership common shares April 12, 2020 preceding three years stockholders 2% shares directors executive officers. Beneficial ownership determined SEC rules.
 36. 49% owned United Microelectronics Corporation March 31, 2020.
 major stockholders different voting rights. not controlled by corporation foreign government.
 information common shares “Item 9. Offer. Price Information American Depositary Shares” annual report.
 April 14, 2018 April 14 2019 April 12, 2020
 Number common shares beneficially owned
 Name Beneficial Owner
 Hsun Chieh Investment Co. 3. 50% 3. 64% 441,371,000 3. 75%
 Silicon Integrated Systems Corp. 2. 50%. 35% 285,380,424 2. 42%
 Directors executive officers 6. 32% 6. 67% 832,664,416 7. 07%


28. Contingent liabilities and legal proceedings
Contingent liabilities are potential future cash outflows, where the likelihood of payment is considered more than remote, but is not considered probable or cannot be measured reliably.
Notes: 1 Performance bonds require the Group to make payments to third parties in the event that the Group does not perform what is expected of it under the terms of any related contracts or commercial arrangements
2 Other guarantees principally comprise Vodafone Group Plc’s guarantee of the Group’s 50% share of an AUD1.7 billion loan facility and a US$3.5 billion loan facility of its joint venture, Vodafone Hutchison Australia Pty Limited. The Group’s share of these loan balances is included in the net investment in joint venture (see note 12 “Investments in associates and joint arrangements”).

                                             | 2019  | 2018
-------------------------------------------- | ----- | -----
                                             | €m    | €m
Performance bonds1                           | 337   | 993
Other guarantees and contingent liabilities2 | 2,943 | 4,036

. Contingent liabilities legal proceedings
 potential future cash outflows likelihood payment not probable.
 Performance bonds require Group payments third parties contracts
 guarantees Vodafone Group Plc’s guarantee 50% share AUD1. 7 billion US$3. 5 billion Vodafone Hutchison Australia Pty Limited. net investment joint venture 12.
 2019 2018
 Performance bonds1 337 993
 Other guarantees contingent liabilities2 2,943 4,036


In the Communications Solutions segment, operating income decreased $79 million in fiscal 2019 as compared to fiscal 2018. The Communications Solutions segment’s operating income included the following:
Excluding these items, operating income decreased in fiscal 2019 due primarily to lower volume.

                                     |       | Fiscal
------------------------------------ | ----- | -------------
                                     | 2019  | 2018
                                     |       | (in millions)
Restructuring and other charges, net | $  48 | $  13
Other items                          | 1     | —
Total                                | $  49 | $  13

Communications Solutions segment operating income decreased $79 million 2019 2018. included
 decreased lower volume.
 2018
 millions
 Restructuring charges net $ 48 $ 13
 Other items
 $ 49  $ 13


Pro Forma Results
The following table summarizes, on a pro forma basis, the combined results of operations of the Company and TOKIN as though the acquisition and the Sale of EMD had occurred as of April 1, 2016. The pro forma amounts presented are not necessarily indicative of either the actual consolidated results had the acquisition occurred as of April 1, 2016, or of future consolidated operating results (amounts in thousands, except per share data):
(1) The net income for the fiscal year ended March 31, 2018 excludes the following: 34% of the gain on sale of the EMD business of $75.2 million, the gain related to the fair value of KEMET’s previous 34% interest in TOKIN of $68.7 million, and the bargain gain on the acquisition of TOKIN of $62.2 million.
(2) The net income for the fiscal year ended March 31, 2017 includes the following: 34% of the gain on sale of the EMD business of $123.4 million (which includes the release of a valuation allowance that was recorded in the fourth quarter of fiscal year 2017 and the use of the deferred tax asset which was recorded in the first quarter of fiscal year 2018), the gain related to the fair value of KEMET’s previous 34% interest in TOKIN of $66.7 million, and the bargain gain on the acquisition of TOKIN of $60.3 million.
(3) Fiscal years ended March 31, 2018 and 2017 adjusted due to the adoption of ASC 606.

                                                                                | Fiscal Years Ended March 31, |
------------------------------------------------------------------------------------ | ---------------------------- | ----------
                                                                                | 2018 (1)                     | 2017 (2)
Pro forma revenues (3)                                                               | $1,217,655                   | $1,060,777
Pro forma net income from continuing operations available to common stockholders (3) | 51,975                       | 226,086
Pro forma earnings per common share - basic (3)                                      | 0.98                         | 4.86
Pro forma earnings per common share - diluted (3)                                    | 0.89                         | 4.08
Pro forma common shares - basic                                                      | 52,798                       | 46,552
Pro forma common shares - diluted                                                    | 58,640                       | 55,389

Pro Forma Results
 table summarizes combined results Company TOKIN acquisition Sale EMD April 1, 2016. pro forma amounts not indicative results future results
 net income fiscal year March 31, 2018 excludes 34% gain sale EMD $75. 2 million gain previous 34% interest TOKIN $68. 7 million bargain gain acquisition $62. 2 million.
 net income March 31, 2017 includes 34% gain sale EMD $123. 4 million valuation allowance quarter deferred tax asset first quarter 2018) gain 34% interest TOKIN $66. 7 million bargain gain acquisition $60. 3 million.
 Fiscal years March 31, 2018 2017 adjusted ASC 606.
 2017
 Pro forma revenues $1,217,655 $1,060,777
 net income operations common stockholders 51,975 226,086
 earnings per common share.
 diluted.
 common shares basic 52,798 46,552
 diluted 58,640 55,389


3. Inventories
Inventories consist of the following (in thousands):

                                          | August 31,2019 | August 31,2018
----------------------------------------- | -------------- | --------------
Raw materials                             | $2,310,081     | $2,070,569
Work in process                           | 468,217        | 788,742
Finished goods                            | 314,258        | 659,335
Reserve for excess and obsolete inventory | (69,553)       | (60,940)
Inventories, net                          | $3,023,003     | $3,457,706

. Inventories
 August 31,2019
 Raw materials $2,310,081 $2,070,569
 468,217 788,742
 Finished goods 314,258,335
 (69,553)
 $3,023,003 $3,457,706


Supplementary Financial Data (Unaudited)
(in millions, except per-share amounts)
(1) In the fourth quarter of fiscal 2019, we recorded an $872 million charge which was the reversal of the previously recorded benefit associated with the U.S. taxation of deemed foreign dividends recorded in fiscal 2018 as a result of a retroactive final U.S. Treasury regulation issued during the quarter.

Quarters Ended                              | July 27, 2019 (1) | April 27, 2019 | January 26, 2019 | October 27, 2018
------------------------------------------- | ----------------- | -------------- | ---------------- | ----------------
Revenue .                                   | $13,428           | $12,958        | $12,446          | $13,072
Gross margin                                | $8,574            | $8,173         | $7,773           | $8,146
Operating income                            | $3,690            | $3,513         | $3,211           | $3,805
Net income                                  | $2,206            | $3,044         | $2,822           | $3,549
Net income per share - basic                | $0.52             | $0.70          | $0.63            | $0.78
Net income per share - diluted              | $0.51             | $0.69          | $0.63            | $0.77
Cash dividends declared per common share .  | $0.35             | $0.35          | $0.33            | $0.33
Cash and cash equivalents and investments . | $33,413           | $34,643        | $40,383          | $42,593

Financial Data
 millions per-share amounts
 fourth quarter 2019 recorded $872 million charge reversal benefit. taxation foreign dividends retroactive. Treasury regulation.
 Quarters Ended July 27, April 27, January 26, October 27,
 Revenue. $13,428 $12,958
 Gross margin $8,574 $8,173
 Operating income $3,690 $3,513 $3,211 $3,805
 Net income $2,206 $3,044 $2,822 $3,549
 Net income share basic.
 diluted.
 Cash dividends common share.
 Cash equivalents investments. $33,413 $34,643 $40,383 $42,593


29. Contract balances
The following table provides information about receivables and contract liabilities from contracts with customers. The Group does not have any contract assets.
There was no revenue recognised in 2019, 2018 or 2017 from performance obligations satisfied in previous periods.
The timing of revenue recognition, invoicing and cash collections results in trade receivables, deferred income and advance customer payments received on account on the balance sheet.
The Group receives payments from customers based on a billing schedule, as established in the contract. Trade receivables are recognised when the right to consideration becomes unconditional. Contract liabilities are recognised as revenue as (or when) the Group performs under the contract.
The Group also recognises incremental costs incurred to obtain a contract as an asset if it expects to recover those costs. Such costs are presented in the balance sheet as assets recognised from costs to obtain a contract and disclosed in note 21.

                                                                                |       | 2019      | 2018      | 2017
------------------------------------------------------------------------------------------------------------- | ----- | --------- | --------- | ---------
                                                                                | Notes | $ million | $ million | $ million
Trade receivables                                                                                | 20    | 128.7     | 123.4     | 113.8
Contract liabilities                                                                                |       |           |           |
Payments received on account                                                                                | 23    | 2.3       | 1.0       | 3.8
Deferred income                                                                                | 25    | 66.8      | 69.6      | 72.7
                                                                                |       | 69.1      | 70.6      | 76.5
Revenue recognised in the period from amounts included in contract liabilities at the beginning of the period |       | 56.2      | 65.5      | 62.1

. Contract balances
 table receivables contract liabilities contracts. Group contract assets.
 no revenue recognised 2019 2018 2017 from obligations previous periods.
 timing revenue recognition invoicing cash collections results in trade receivables deferred income advance customer payments.
 Group receives payments billing schedule. receivables recognised when right consideration unconditional. Contract liabilities recognised as revenue contract.
 recognises incremental costs contract. costs presented balance as assets disclosed in note 21.
 Trade receivables 128. 123. 113.
 Contract liabilities
 Payments received account.
 Deferred income 66. 69. 72.
. 70. 76.
 Revenue recognised from contract liabilities beginning 56. 65. 62.


NOTE 2 — EARNINGS PER SHARE
Basic earnings per share (“EPS”) is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding stock options and stock awards.
The components of basic and diluted EPS were as follows:
Anti-dilutive stock-based awards excluded from the calculations of diluted EPS were immaterial during the periods presented.

(In millions, except earnings per share)                |           |           |
------------------------------------------------------- | --------- | --------- | ---------
Year Ended June 30,                                     | 2019      | 2018      | 2017
Net income available for common shareholders (A)        | $  39,240 | $  16,571 | $  25,489
Weighted average outstanding shares of common stock (B) | 7,673     | 7,700     | 7,746
Dilutive effect of stock-based awards                   | 80        | 94        | 86
Common stock and common stock equivalents (C)           | 7,753     | 7,794     | 7,832
Earnings Per Share                                      |           |           |
Basic (A/B)                                             | $ 5.11    | $ 2.15    | $ 3.29
Diluted (A/C)                                           | $ 5.06    | $ 2.13    | $ 3.25

EARNINGS PER SHARE
 Basic computed average common stock. Diluted EPS dilutive potential shares treasury stock method. include stock options awards.
 components basic diluted EPS
 Anti-dilutive stock-based awards excluded immaterial.
 Ended June 30 2019 2018
 Net income common shareholders $ 39,240 $ 16,571 $ 25,489
 Weighted average shares common stock 7,673 7,700 7,746
 Dilutive effect stock-based awards 80
 Common stock equivalents 7,753 7,794
 Earnings Per Share
 Basic $ 5. 11 $.
 Diluted $ 5. $.


(5) GOODWILL AND OTHER INTANGIBLE ASSETS
The carrying value of goodwill by segment was as follows:
Reclassifications and other during the year ended December 31, 2019 were due primarily to tax adjustments for acquisitions in 2019 and 2018. See Note 2 for information regarding acquisitions.

                                         | Application Software | Network Software & Systems | Measurement & Analytical Solutions | Process Technologies | Total
---------------------------------------- | -------------------- | -------------------------- | ---------------------------------- | -------------------- | ------------
Balances at December 31, 2017            | $ 4,565.4            | $ 2,591.3                  | $ 1,345.4                          | $ 318.2              | $    8,820.3
Goodwill acquired                        | 684.4                | 33.1                       | —                                  | —                    | 717.5
Goodwill related to assets held for sale | —                    | —                          | (156.2)                            | —                    | (156.2)
Currency translation adjustments         | (17.0)               | (2.3)                      | (14.5)                             | (5.9)                | (39.7)
Reclassifications and other              | 3.3                  | 1.6                        | —                                  | —                    | 4.9
Balances at December 31, 2018            | $ 5,236.1            | $ 2,623.7                  | $ 1,174.7                          | $312.3               | $  9,346.8
Goodwill acquired                        | 143.4                | 1,303.6                    | —                                  | —                    | 1,447.0
Currency translation adjustments         | 8.3                  | 8.8                        | 3.3                                | 2.2                  | 22.6
Reclassifications and other              | 1.6                  | (2.6)                      | —                                  | —                    | (1.0)
Balances at December 31, 2019            | $ 5,389.4            | $ 3,933.5                  | $ 1,178.0                          | $ 314.5              | $ 10,815.4

GOODWILL ASSETS
 carrying value segment
 Reclassifications 2019 due tax adjustments acquisitions 2019 2018. See Note 2 acquisitions.
 Application Software Network Software Systems Measurement Analytical Solutions Process Technologies
 Balances December 31, 2017 $ 4,565. $ 2,591. $ 1,345. $ 318. $ 8,820.
 Goodwill acquired 684. 33. 717.
 Goodwill assets sale (156.
.
 Reclassifications 3.
 Balances December 31, 2018 $ 5,236. $ 2,623. $ 1,174. $312. $ 9,346.
 Goodwill acquired 143. 1,303. 1,447.
 8. 22.
 Reclassifications. (2.
 Balances December 31, 2019 $ 5,389. $ 3,933. $ 1,178. 314. $ 10,815.


Cash Flow Hedges
For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of AOCI and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings or it becomes probable the forecasted transactions will not occur. The following is a summary of the gains (losses) related to cash flow hedges recognized during the years ended June 30, 2019, 2018 and 2017:

                                               |       | Amount of Gain (Loss) Recognized in AOCI on Derivatives |
---------------------------------------------- | ----- | ------------------------------------------------------- | -----
                                               |       | Years Ended June 30,                                    |
($ in millions)                                | 2019  | 2018                                                    | 2017
Derivatives in Cash Flow Hedging Relationship: |       |                                                         |
Commodity contracts                            | $45.4 | $41.4                                                   | $9.4
Foreign exchange contracts                     | (0.9) | (0.4)                                                   | (0.1)
Total                                          | $44.5 | $41.0                                                   | $9.3

Cash Flow Hedges
 derivative instruments hedges gain loss reported AOCI reclassified earnings transactions affect earnings. summary gains (losses cash flow hedges June 30 2019 2018 2017:
 Gain (Loss AOCI Derivatives
 Years Ended June 30
 millions 2019 2018 2017
 Derivatives Cash Flow Hedging Relationship
 Commodity contracts $45. 4 $41. $9.
 Foreign exchange contracts.
 $44. 5 $41. $9.


Adjusted EBITDA is defined as Earnings before Interest Expense, Taxes, Depreciation and Amortization, adjusted to exclude the impact of Special Items. Management uses Adjusted EBITDA as one of many measures to assess the performance of the business. Additionally, Adjusted EBITDA is the performance metric used by the Company's chief operating decision maker to evaluate performance of our reportable segments. Adjusted EBITDA is also a metric used to determine performance in the Company's Annual Incentive Plan. We do not believe there are estimates underlying the calculation of Adjusted EBITDA, other than those inherent in our U.S. GAAP results of operations, which would render the use and presentation of Adjusted EBITDA misleading. While the nature and amount of individual Special Items vary from period to period, we believe our calculation of Adjusted EBITDA is applied consistently to all periods and, in conjunction with other U.S. GAAP and non- U.S. GAAP measures, provides a useful and consistent comparison of our Company's performance to other periods. In our evaluation of Adjusted EBITDA, management assumes that gain/losses related to Special Items may not be reflective of our core operating results.
(1) Includes depreciation and amortization adjustments of $(0.8) million and $(2.4) million for the years ended December 31, 2019 and 2018, respectively.
(2) Other Special Items for the years ended December 31, 2019 and 2018, primarily included fees related to professional services, mainly legal fees, directly associated with Special Items or events that are considered one-time or infrequent in nature.
The Company may also assess performance using Adjusted EBITDA Margin. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by net trade sales. We believe that Adjusted EBITDA Margin is one useful measure to assess the profitability of sales made to third parties and the efficiency of our core operations.
The following table shows a reconciliation of U.S. GAAP Net Earnings from continuing operations to non-U.S. GAAP Total Company Adjusted EBITDA from continuing operations:

                                                                       |         | Year Ended December 31, |
---------------------------------------------------------------------- | ------- | ----------------------- | -------
(In millions)                                                          | 2019    | 2018                    | 2017
Net earnings from continuing operations                                | $ 293.7 | $ 150.3                 | $ 62.8
Interest expense, net                                                  | 184.1   | 177.9                   | 184.2
Income tax provision                                                   | 76.6    | 307.5                   | 330.5
Depreciation and amortization, net of adjustments(1)                   | 184.5   | 159.0                   | 158.3
Special Items:                                                         |         |                         |
Restructuring charges                                                  | 41.9    | 47.8                    | 12.1
Other restructuring associated costs                                   | 60.3    | 15.8                    | 14.3
Foreign currency exchange loss due to highly inflationary economies    | 4.6     | 2.5                     | —
Loss on debt redemption and refinancing activities                     | 16.1    | 1.9                     | —
Charges related to acquisition and divestiture activity                | 14.9    | 34.2                    | 84.1
Charges related to the Novipax settlement agreement                    | 59.0    | —                       | —
Gain from class-action litigation settlement                           | —       | (14.9)                  | —
Curtailment related to retained Diversey retirement plans              | —       | —                       | (13.5)
Other Special Items(2)                                                 | 29.1    | 7.5                     | 0.5
Pre-tax impact of Special Items                                        | 225.9   | 94.8                    | 97.5
Non-U.S. GAAP Total Company Adjusted EBITDA from continuing operations | $ 964.8 | $ 889.5                 | $ 833.3

Adjusted EBITDA defined as Earnings before Interest Expense Taxes Depreciation Amortization Special Items. Management uses performance business. performance metric Company chief decision. performance Annual Incentive Plan. estimates underlying. results misleading. Special Items vary calculation applied to all periods. provides comparison performance. assumes gain/losses to Special Items may not reflective of core operating results.
 Includes depreciation amortization adjustments of $(0. 8) million $(2. 4) million years ended December 31, 2019 2018.
 Other Special Items fees professional services legal fees associated with Special Items events one-time infrequent.
 performance using Adjusted EBITDA Margin. calculated as divided by net trade sales. profitability of sales to third parties efficiency core operations.
 table shows reconciliation of U. GAAP Net Earnings from operations to non-U.GAAP Company Adjusted EBITDA operations
 December 31,
 2019
 Net earnings operations $ 293. $ 150. 62.
 Interest expense 184. 177.
 Income tax provision 76. 307. 330.
 Depreciation amortization 184. 159. 158.
 Special Items
 Restructuring 41. 47.
 restructuring costs 60. 15.
 Foreign currency exchange loss inflationary economies.
 Loss debt redemption refinancing 16.
 Charges acquisition divestiture 14.
 Novipax settlement agreement 59.
 class-action litigation settlement.
 retirement plans.
 Special 29. 7.
 Pre-tax impact Special Items 225. 94. 97.
. GAAP Company Adjusted EBITDA operations $ 964. $ 889. $ 833.


Management makes allowance for expected credit loss based on the simplified approach to provide for expected credit losses, which permits the use of the lifetime expected loss provision for all trade receivables. Expected credit loss for receivables overdue more than 180 days is 25%-100%, depending on category. Expected credit loss for receivables overdue more than one year is 100%.
Movements in provisions for impairment of freight receivables during the year are as follows:
Allowance for expected credit loss of freight receivables have been recognized in the income statement under "Port expenses, bunkers and commissions".
Allowance for expected credit loss of freight receivables is calculated using an ageing factor as well as a specific customer knowledge and is based on a provision matrix on days past due.

USDm                                | 2019 | 2018 | 2017
----------------------------------- | ---- | ---- | ----
Allowance for expected credit loss  |      |      |
Balance as of 1 January             | 1.7  | 1.3  | 2.6
Adjustment to prior years           | 1.5  | -    | -
Provisions for the year             | 2.4  | 1.7  | 0.6
Provisions reversed during the year | -1.9 | -1.0 | -1.9
Provisions utilized during the year | -    | -0.3 | -
Balance as of 31 December           | 3.7  | 1.7  | 1.3

Management allowance expected credit loss simplified approach lifetime provision trade receivables. receivables overdue 180 days 25%-100% depending category. receivables overdue one year 100%.
 Movements provisions freight receivables
 Allowance credit loss recognized income statement "Port expenses bunkers commissions.
 calculated ageing factor customer knowledge based provision matrix days past due.
 2019 2018
 Allowance credit loss
 Balance 1 January 1. 7 1. 3 2. 6
 Adjustment prior years 1. 5
 Provisions 2. 4 1.
 -1. 9.
.
 Balance 31 December 3. 7 1.


Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible differences and operating loss and tax credit carry-forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the difference between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
At December 31, 2019, the Company had net operating loss carry-forwards of approximately $21.6 million that may be offset against future taxable income indefinitely. No tax benefit has been reported in the 2019 financial statements, since the potential tax benefit is offset by a valuation allowance of the same amount.
Net deferred tax assets consist of the following components as of December 31, 2019 and 2018:
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry-forwards for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry-forwards may be limited as to use in future years.

                                   | 2019    | 2018
---------------------------------- | ------- | -------
Deferred tax assets (liabilities): |         |
NOL carryover                      | $5,910  | $3,370
R&D carryover                      | 173     | 173
Other                              | 236     | 239
Depreciation                       | 42      | 61
                                   | 6,361   | 3,843
Less valuation allowance           | (6,361) | (3,843)
Net deferred tax asset             | $-      | $-

Deferred taxes assets recognized deductible differences operating loss tax credit carry temporary differences. differences reported assets tax bases. assets reduced by valuation allowance. adjusted tax laws rates enactment.
 December 31, 2019 Company net operating loss carry-forwards $21. 6 million offset against future taxable income. No tax benefit reported 2019 financial statements potential offset valuation allowance.
 Net deferred tax assets 2019
 change ownership Tax Reform Act 1986 net operating loss carry-forwards subject annual limitations. change ownership carry-forwards limited future years.
 Deferred tax assets
 NOL carryover $5,910 $3,370
 R&D carryover 173
 236
 Depreciation 42
 6,361 3,843
 Less valuation allowance
 Net deferred tax asset


Other Current Assets
The following table presents details of other current assets in our consolidated balance sheets:

                                  | As of December 31,    |
--------------------------------- | --------------------- | ----
                                  | 2019                  | 2018
                                  | (Dollars in millions) |
Prepaid expenses                  | $274                  | 307
Income tax receivable             | 35                    | 82
Materials, supplies and inventory | 105                   | 120
Contract assets                   | 42                    | 52
Contract acquisition costs        | 178                   | 167
Contract fulfillment costs        | 115                   | 82
Other                             | 59                    | 108
Total other current assets        | $808                  | 918

Assets
 table balance sheets
 December 31,
 Prepaid expenses $274 307
 Income tax receivable 35
 Materials supplies inventory 105 120
 Contract assets 42
 acquisition costs 178 167
 fulfillment costs 115
 59 108
 assets $808


13. CONTRIBUTED EQUITY
Capital raise On 4 September 2018, the Group undertook a fully underwritten $175.4m equity raising. This resulted in the issue of 105,677,937 new stapled securities (2018: $59.5m equity raising resulting in the issue of 39,712,882 stapled securities).
On 25 June 2019, the Group announced a fully underwritten $170m equity raising. On 28 June 2019, the Group received proceeds for this raising. This has been recognised as a contract for future issue of equity under AASB 132 and has been recognised as contributed equity within the statement of financial position. This resulted in the issue of 99,415,205 new stapled securities on 1 July 2019. These securities are not reflected in the securities on issue above as they were issued subsequent to the year end.
On 25 June 2019, the Group also announced a non-underwritten security purchase plan. This completed on 30 July 2019, raising $13.5m and resulted in the issue of 7,917,735 new stapled securities.
Distribution reinvestment plan During the year, 9,143,772 (2018: 6,480,246) stapled securities were issued to securityholders participating in the Group’s Distribution Reinvestment Plan for consideration of $16.2m (2018: $9.6m). The stapled securities were issued at the volume weighted average market price of the Group's stapled securities over a period of ten trading days, less a 2% discount.

                                      | 2019        | 2018
------------------------------------- | ----------- | -----------
                                      | $'000       | $'000
Issued and paid up capital            | 83,692      | 66,128
Contract for future issue of equity   | 16,451      | -
Total contributed equity              | 100,143     | 66,128
Number of stapled securities on Issue | 2019        | 2018
Opening balance at 1 July             | 559,107,042 | 512,913,914
Institutional and retail placement    | 105,677,937 | 39,712,882
Distribution reinvestment plan        | 9,143,772   | 6,480,246
Closing balance at 30 June            | 673,928,751 | 559,107,042

. CONTRIBUTED EQUITY
 September 2018 Group $175. 4m equity raising. 105,677,937 securities $59. 5m 39,712,882.
 25 June 2019 $170m equity raising. 28 June 2019 received proceeds. future issue equity AASB 132 contributed equity. 99,415,205 securities 1 July 2019. not reflected.
 25 June 2019 non-underwritten security purchase plan. 30 July 2019 $13. 5m,735 securities.
 reinvestment 9,143,772 (2018 6,480,246) securities issued $16. 2m (2018 $9. 6m. volume average market price ten trading days 2% discount.
 Issued capital 83,692 66,128
 future issue equity 16
 contributed equity 100,143 66,128
 securities
 balance 1 July,107,042 512,913,914
 Institutional retail placement 105,677,937 39,712,882
9,143,772 6,480,246
 673,928,751,107,042


ACQUISITIONS OF PROPERTY, PLANT AND EQUIPMENT
The acquisitions of property, plant and equipment as well as the capital intensity per operating segment are as follows:
(1) Fiscal 2018 was restated to comply with IFRS 15 and to reflect a change in accounting policy. For further details, please consult the "Accounting policies" section. (2) Fiscal 2019 actuals are translated at the average foreign exchange rate of the comparable period of fiscal 2018 which was 1.3100 USD/CDN.
Fiscal 2019 fourth-quarter acquisitions of property, plant and equipment decreased by 10.6% (11.2% in constant currency) mainly due to lower capital expenditures in the Canadian and American broadband services segments. Fiscal 2019 fourth-quarter capital intensity reached 24.9% compared to 28.7% for the same period of the prior year mainly as a result of lower capital capital expenditures combined with higher revenue.

Three months ended August 31,                 | 2019    | 2018    | Change | Change in constant currency(2)
--------------------------------------------- | ------- | ------- | ------ | ------------------------------
(in thousands of dollars, except percentages) | $       | $       | %      | %
Canadian broadband services                   | 79,132  | 89,405  | (11.5) | (11.7)
Capital intensity                             | 24.7%   | 28.0%   |        |
American broadband services                   | 65,967  | 72,914  | (9.5)  | (10.5)
Capital intensity                             | 25.0%   | 29.6%   |        |
Consolidated                                  | 145,099 | 162,319 | (10.6) | (11.2)
Capital intensity                             | 24.9%   | 28.7%   |        |

ACQUISITIONS PROPERTY PLANT EQUIPMENT
 capital intensity per segment
 Fiscal 2018 restated IFRS 15 change accounting policy. policies. Fiscal 2019 translated average foreign exchange rate 1. 3100 USD/CDN.
 2019 fourth-quarter acquisitions decreased 10. 6% (11. 2% lower capital expenditures Canadian American broadband services segments. capital intensity 24. 9% 28. 7% prior year lower expenditures higher revenue.
 Three months ended August 31,
 Canadian broadband services 79,132 89,405.
 24. 7% 28. 0%
 American broadband services 65,967 72,914.
 25. 0% 29. 6%
 Consolidated 145,099 162,319.
 24. 9% 28. 7%


The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition.
The amount recorded for developed technology represents the estimated fair value of Trello’s project management and organization technology. The amount recorded for customer relationships represents the fair values of the underlying relationship with Trello customers.

                                                | Fair Value            | Useful Life
----------------------------------------------- | --------------------- | -----------
                                                | (U.S. $ in thousands) | (years)
Developed technology                            | $50,600               | 3
Customer relationships                          | 56,900                | 2
Trade names                                     | 19,900                | 3
Total intangible assets subject to amortization | $127,400              |

table intangible assets acquired estimated lives date acquisition.
 developed technology project management organization. customer relationships values Trello customers.
 Value Useful Life
. thousands
 Developed technology $50,600
 Customer relationships 56,900
 Trade names 19,900
 Total intangible assets amortization $127,400


During the three months ended June 30, 2018, the Company adopted ASU 2016-18-Statement of Cash Flows: Restricted Cash. This standard requires that the statement of cash flows explain the change during the period in total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The standard has been applied using a retrospective transition method to each period presented. The adoption of this standard did not have a material impact on the Company's financial statements.
The following table summarizes the opening balance sheet adjustments related to the adoption of the New Revenue Standard, ASU 2016-01-Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, and ASU 2016-16-Intra-Entity Transfers of Assets Other Than Inventory (in millions):

                                             | Balance as of  |          | Adjustments from |             | Balance as of
-------------------------------------------- | -------------- | -------- | ---------------- | ----------- | -------------
                                             | March 31, 2018 | ASC 606  | ASU 2016-01      | ASU 2016-16 | April 1, 2018
ASSETS                                       |                |          |                  |             |
Accounts receivable, net                     | $563.7         | $340.1   | $—               | $—          | $903.8
Inventories                                  | $476.2         | $(5.1)   | $—               | $—          | $471.1
Other current assets                         | $119.8         | $17.2    | $—               | $—          | $137.0
Long-term deferred tax assets                | $100.2         | $(23.1)  | $—               | $1,579.4    | $1,656.5
Other assets                                 | $71.8          | $—       | $—               | $(24.1)     | $47.7
LIABILITIES                                  |                |          |                  |             |
Accrued liabilities                          | $229.6         | $404.2   | $—               | $—          | $633.8
Deferred income on shipments to distributors | $333.8         | $(333.8) | $—               | $—          | $—
Long-term deferred tax liability             | $205.8         | $16.8    | $—               | $(1.1)      | $221.5
Other long-term liabilities                  | $240.9         | $—       | $—               | $(1.7)      | $239.2
STOCKHOLDERS' EQUITY                         |                |          |                  |             |
Accumulated other comprehensive loss         | $(17.6)        | $—       | $(1.7)           | $—          | $(19.3)
Retained earnings                            | $1,397.3       | $241.9   | $1.7             | $1,558.1    | $3,199.0

months June 30, 2018 Company adopted ASU 2016-18-Statement Cash Flows Restricted Cash. standard requires change total cash cash equivalents restricted. reconciling end-period amounts. standard retrospective transition method. financial statements.
 table summarizes balance sheet adjustments New Revenue Standard ASU 2016-01-Financial Instruments Overall (Subtopic 825-10): Recognition Measurement Financial Assets Financial Liabilities ASU 2016-16-Intra-Entity Transfers of Assets Other Than Inventory millions):
 Balance Adjustments
 March 31, 2018 ASU 2016-01 ASU 2016-16 April 1, 2018
 Accounts receivable net $563. $340. $903.
 Inventories $476. $471.
 current assets $119. $17. $137.
 Long-term deferred tax assets $100. $1,579. $1,656.
 assets $71.(24. $47.
LIABILITIES
 Accrued liabilities $229. $404. $633.
 Deferred income shipments $333.(333.
-term deferred tax liability $205. $16. $221.
 long-term liabilities $240. 9. $239.
 STOCKHOLDERS' EQUITY
 loss $(17. 6).
 Retained earnings $1,397. $241. $1. $1,558. $3,199.


GreenSky, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (United States Dollars in thousands, except per share data, unless otherwise stated)
The following table presents activities associated with our loan receivable sales and servicing activities during the periods indicated.

                                                   |         | Year Ended December 31, |
-------------------------------------------------- | ------- | ----------------------- | -------
                                                   | 2019    | 2018                    | 2017
Gain (loss) on sold loan receivables held for sale | $—      | $—                      | $(500)
Cash Flows                                         |         |                         |
Sales of loans                                     | $91,946 | $139,026                | $72,071
Servicing fees                                     | 3,901   | 2,321                   | 2,821

GreenSky. FINANCIAL STATEMENTS States Dollars thousands share data
 table presents loan receivable sales servicing.
 Ended December 31,
 2018 2017
 Gain sold loan receivables
 Cash Flows
 Sales loans $91,946 $139,026 $72,071
 Servicing fees 3,901


Cash flow measures and capital additions
In presenting and discussing our reported results, free cash flow (pre-spectrum), free cash flow, capital additions and operating free cash flow are calculated and presented even though these measures are not recognised within IFRS. We believe that it is both useful and necessary to communicate free cash flow to investors and other interested parties, for the following reasons:
Free cash flow (pre-spectrum) and free cash flow allows us and external parties to evaluate our liquidity and the cash generated by our operations. Free cash flow (pre-spectrum) and capital additions do not include payments for licences and spectrum included within intangible assets, items determined independently of the ongoing business, such as the level of dividends, and items which are deemed discretionary, such as cash flows relating to acquisitions and disposals or financing activities. In addition, it does not necessarily reflect the amounts which we have an obligation to incur. However, it does reflect the cash available for such discretionary activities, to strengthen the consolidated statement of financial position or to provide returns to shareholders in the form of dividends or share purchases;
– Free cash flow facilitates comparability of results with other companies, although our measure of free cash flow may not be directly comparable to similarly titled measures used by other companies;
– These measures are used by management for planning, reporting and incentive purposes; and
These measures are useful in connection with discussion with the investment analyst community and debt rating agencies.
A reconciliation of cash generated by operations, the closest equivalent GAAP measure, to operating free cash flow and free cash flow, is provided below.

                                                               | 2019    | 2018    | 2017
-------------------------------------------------------------- | ------- | ------- | -------
                                                               | €m      | €m      | €m
Cash generated by operations (refer to note 18)                | 14,182  | 13,860  | 13,781
Capital additions                                              | (7,227) | (7,321) | (7,675)
Working capital movement in respect of capital additions       | (89)    | 171     | (822)
Disposal of property, plant and equipment                      | 45      | 41      | 43
Restructuring payments                                         | 195     | 250     | 266
Other                                                          | (35)    | –       | 34
Operating free cash flow                                       | 7,071   | 7,001   | 5,627
Taxation                                                       | (1,040) | (1,010) | (761)
Dividends received from associates and investments             | 498     | 489     | 433
Dividends paid to non-controlling shareholders in subsidiaries | (584)   | (310)   | (413)
Interest received and paid                                     | (502)   | (753)   | (830)
Free cash flow (pre-spectrum)                                  | 5,443   | 5,417   | 4,056
Licence and spectrum payments                                  | (837)   | (1,123) | (474)
Restructuring payments                                         | (195)   | (250)   | (266)
Free cash flow                                                 | 4,411   | 4,044   | 3,316

Cash flow measures capital additions
 results free cash flow capital additions operating free cash flow calculated not recognised IFRS. communicate free cash flow investors
 Free cash allows evaluate liquidity cash operations. include payments for licences intangible assets items dividends items discretionary acquisitions disposals financing. reflect amounts obligation incur. cash for discretionary activities financial position returns dividends share purchases
 Free cash flow facilitates comparability results
 measures used management for planning reporting incentive purposes
 useful discussion investment community debt rating agencies.
 reconciliation of cash generated operations operating free cash flow provided below.
 2019 2018  2017
 Cash generated operations 18)  14,182 | 13,860 13,781
 Capital additions  (7,227)  (7,321) (7,675)
 Working capital movement capital additions  (89)  171 | (822)
property plant equipment 45
 Restructuring payments 266
 free cash flow 7,071
 Taxation (1,040)
 Dividends
 non-controlling shareholders (584 (310)
 Interest (502)
 cash flow 5,443 5,417 4,056
 Licence spectrum payments (1,123 (474)
 Restructuring payments (195) (250
 cash flow 4,411 4,044 3


Net finance cost was £47.2m for the year; a decrease of £1.2m on 2017/18. Net regular interest in the year was £40.5m, a decrease of £3.9m compared to the prior year. Consistent with recent years, the largest component of finance costs in the year was interest due to holders of the Group’s senior secured notes, which was £31.7m.
The interest on the senior secured notes was £0.5m lower compared to the prior year following the re-financing of the June 2021 £325m fixed rate notes at a coupon of 6.5% to the October 2023 £300m fixed rate notes to the slightly lower coupon of 6.25%. Bank debt interest of £5.1m was £2.1m lower in the year due to lower levels of average debt and a lower margin on the revolving credit facility following the refinancing completed in May 2018. Amortisation of debt issuance costs was £3.7m, £1.3m lower than the prior year due to lower transaction costs associated with the issue of the £300m 6.25% Fixed rate notes compared with the retired £325m 6.5% Fixed rate notes.
Write-off of financing costs and early redemption fees of £11.3m include a £5.7m fee related to the write-off of transaction costs associated with the senior secured fixed rate notes due March 2021, which were repaid during the year, and a £5.6m redemption fee associated with the early call of the March 2021 bond.
In the prior year, a £0.4m discount unwind credit relating to long-term property provisions held by the Group due to an increase in gilt yields was reflected in reported Net finance cost. In 2018/19, a discount unwind charge of £3.0m was included in the Net finance cost of £47.2m. Other interest income of £7.6m in the year relates to monies received from the Group’s associate Hovis Holdings Limited ('Hovis') and reflects the reversal of a previous impairment.

£m                                                          | 2018/19 | 2017/18 | Change
----------------------------------------------------------- | ------- | ------- | ------
Senior secured notes interest                               | 31.7    | 32.2    | 0.5
Bank debt interest                                          | 5.1     | 7.2     | 2.1
                                                            | 36.8    | 39.4    | 2.6
Amortisation of debt issuance costs                         | 3.7     | 5.0     | 1.3
Net regular interest5                                       | 40.5    | 44.4    | 3.9
Fair value movements on interest rate financial instruments | –       | (0.4)   | (0.4)
Write-off of financing costs and early redemption fees      | 11.3    | 4.0     | (7.3)
Discount unwind                                             | 3.0     | (0.4)   | (3.4)
Other finance income                                        | (7.6)   | –       | 7.6
Other interest cost                                         | –       | 0.8     | 0.8
Net finance cost                                            | 47.2    | 48.4    | 1.2

finance cost £47. 2m decrease £1. 2m 2017/18. interest £40. 5m decrease £3. 9m. largest senior secured notes £31. 7m.
 £0. 5m lower re-financing June 2021 £325m 6. 5% October 2023 £300m 6. 25%. Bank debt interest £5. 1m £2. 1m lower lower average debt lower margin revolving credit refinancing 2018. debt issuance costs £3. 7m £1. 3m lower lower transaction costs £300m 6. 25% £325m 6. 5%.
 financing costs redemption fees £11. 3m £5. 7m fee £5. 6m redemption fee 2021.
 £0. 4m discount unwind credit long-term property provisions gilt yields finance cost. 2018/19 discount unwind charge £3. 0m finance cost £47. 2m. interest income £7. 6m Hovis Holdings Limited reversal previous impairment.
secured notes interest 31. 7 32.
 Bank debt interest 5. 7.
 36. 39.
 Amortisation debt issuance costs 3. 7 5.
 40. 44.
 movements interest rate instruments. 4)
 Write-off financing costs redemption fees 11. 3.
 Discount 3.
 finance income. 6).
 interest cost. 8.
 finance cost 47. 48. 4.


10. Debt
A summary of debt is shown below:
Revolving Credit Facility/Term Loan
On September 12, 2018, the Company entered into five-year Amended and Restated Credit Agreement (“Credit Agreement”) with Bank of America, N.A., as Administrative Agent, and Wells Fargo Bank, N.A. The Credit Agreement amends and restates the credit agreement, dated November 18, 2016, among the Company, Bank of America, N.A. and Wells Fargo Bank, N.A. The Credit Agreement consists of a senior unsecured revolving credit facility (“Revolving Credit Facility”) of $200.0 million and a senior unsecured term loan (“Term Loan”) of $250.0 million. In addition, the Company has an option to increase the size of the Revolving Credit Facility and Term Loan by up to an additional $200.0 million. The Credit Agreement is guaranteed by the Company’s wholly-owned U.S. subsidiaries. For the Term Loan, the Company is required to make quarterly principal payments of 1.25% of the original Term Loan ($3.1 million) through maturity, with the remaining balance due on September 12, 2023.
Outstanding borrowings under the Credit Agreement bear interest at variable rates based on the type of borrowing and the Company’s debt to EBITDA financial ratio, as defined. The interest rate on outstanding borrowings under the Credit Agreement was 3.98% at April 27, 2019. The Credit Agreement contains customary representations and warranties, financial covenants, restrictive covenants and events of default. As of April 27, 2019, the Company was in compliance with all the covenants in the Credit Agreement. The fair value of borrowings under the Credit Agreement approximates book value because the interest rate is variable.
Subsidiary Credit Facility
The Company’s subsidiary, Pacific Insight, is a party to a credit agreement with the Bank of Montreal which provides a credit facility in the maximum principal amount of C$10.0 million, with an option to increase the principal amount by up to an additional C$5.0 million. Availability under the facility is based on a percentage of eligible accounts receivable and finished goods inventory balances. Interest is calculated at a base rate plus margin, as defined. In addition, Pacific Insight was a party to a credit agreement with Roynat which was terminated during the second quarter of fiscal 2019. Total repayments under the credit agreement with Roynat were $3.8 million in fiscal 2019, including a prepayment fee of $0.1 million.
Other Debt
The Company’s subsidiary, Procoplast, has debt that consists of eighteen notes with maturities ranging from 2019 to 2031. The weighted-average interest rate was approximately 1.5% at April 27, 2019 and $3.2 million of the debt was classified as short-term. The fair value of other debt was $16.3 million at April 27, 2019 and was based on Level 2 inputs on a nonrecurring basis.
Unamortized Debt Issuance Costs
The Company paid debt issuance costs of $3.1 million on September 12, 2018 in connection with the Credit Agreement. The debt issuance costs are being amortized over the five-year term of the Credit Agreement.

(Dollars in Millions)           | April 27, 2019 | April 28, 2018
------------------------------- | -------------- | --------------
Revolving Credit Facility       | $35.0          | $30.0
Term Loan                       | 243.7          | —
Subsidiary Credit Facility      | —              | 3.6
Other Debt                      | 16.8           | 24.2
Unamortized Debt Issuance Costs | (2.9)          | —
Total Debt                      | 292.6          | 57.8
Less: Current Maturities        | (15.7)         | (4.4)
Total Long-term Debt            | $276.9         | $53.4

. Debt
 Revolving Credit Facility/Term Loan
 September 12, 2018 Company five-year Credit Agreement Bank of America. Wells Fargo Bank. amends restates November 18, 2016,. senior unsecured revolving credit facility $200. million unsecured term loan $250. million. option increase $200. 0 million. guaranteed wholly-owned U. S. subsidiaries. quarterly principal payments. 25% original Loan ($3. 1 million) maturity remaining balance due September 12, 2023.
 borrowings variable rates debt EBITDA ratio. interest rate 3. 98% April 27, 2019. contains representations warranties financial covenants restrictive covenants events default. compliance covenants. fair value approximates book value interest rate variable.
 Subsidiary Credit Facility
 Pacific Insight credit agreement Bank of Montreal maximum principal C$10. 0 million option increase C$5. 0 million. Availability based eligible accounts receivable finished goods inventory balances.Interest calculated base rate plus margin. Pacific Insight credit agreement Roynat terminated quarter 2019. repayments $3. 8 million prepayment fee $0. 1 million.
 Procoplast eighteen notes maturities 2019 to 2031.-average interest rate 1. 5% April 27, 2019 $3. 2 million short-term. fair value debt $16. 3 million Level 2 inputs nonrecurring.
 Unamortized Debt Issuance
 paid costs $3. 1 million September 12 2018. amortized five-year term.
 April 27, 2019
 Revolving Credit Facility.
 Term Loan.
 Subsidiary Credit Facility.
 Debt.
 Unamortized Debt Issuance Costs.
 Debt.
.
 Long-term Debt $276.


During the fourth and third quarters of 2019 and the fourth quarter of 2018, we recorded an income tax expense of $62 million, $28 million and $28 million, respectively, reflecting (i) in the third quarter of 2019 the estimated annual effective tax rate in each of our jurisdictions, applied to the consolidated results before taxes in the third quarter of 2019 and (ii) in both fourth quarters the actual tax charges and benefits in each jurisdiction as well as the true-up of tax provisions based upon the most updated visibility on open tax matters in several jurisdictions. and (ii) in both fourth quarters the actual tax charges and benefits in each jurisdiction as well as the true-up of tax provisions based upon the most updated visibility on open tax matters in several jurisdictions. and (ii) in both fourth quarters the actual tax charges and benefits in each jurisdiction as well as the true-up of tax provisions based upon the most updated visibility on open tax matters in several jurisdictions.
Income tax expense

                   |                   | Three Months Ended       |
------------------ | ----------------- | ------------------------ | -----------------
                   | December 31, 2019 | September 29, 2019       | December 31, 2018
                   |                   | (Unaudited, in millions) |
Income tax expense | $(62)             | $(28)                    | $(28)

fourth third quarters 2019 2018 recorded income tax expense $62 million $28 million $28 million reflecting third quarter 2019 estimated annual effective tax rate jurisdictions consolidated results taxes both fourth quarters actual tax charges benefits jurisdiction true-up tax provisions updated visibility open matters. quarters tax charges benefits true-up provisions. tax charges benefits true-up tax provisions.
 Income tax expense
 Three Months Ended
 December 31, 2019 September 29, 2019 December 31, 2018
 (Unaudited millions
 Income tax expense $(62) $(28) $


AMERICAN TOWER CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Tabular amounts in millions, unless otherwise disclosed)
The Company expects the unrecognized tax benefits to change over the next 12 months if certain tax matters ultimately settle with the applicable taxing jurisdiction during this timeframe, or if the applicable statute of limitations lapses. The impact of the amount of such changes to previously recorded uncertain tax positions could range from zero to $53.0 million.
A reconciliation of the beginning and ending amount of unrecognized tax benefits are as follows:
During the years ended December 31, 2019, 2018 and 2017, the statute of limitations on certain unrecognized tax benefits lapsed and certain positions were effectively settled, which resulted in a decrease of $2.5 million, $9.3 million and $0.4 million, respectively, in the liability for uncertain tax benefits.
The Company recorded penalties and tax-related interest expense to the tax provision of $10.3 million, $8.0 million and $5.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. In addition, due to the expiration of the statute of limitations in certain jurisdictions and certain positions that were effectively settled, the Company reduced its liability for penalties and income tax-related interest expense related to uncertain tax positions during the years ended December 31, 2019, 2018 and 2017 by $2.7 million, $16.2 million and $0.6 million, respectively.
As of December 31, 2019 and 2018, the total amount of accrued income tax-related interest and penalties included in the consolidated balance sheets were $26.6 million and $19.1 million, respectively.
The Company has filed for prior taxable years, and for its taxable year ended December 31, 2019 will file, numerous consolidated and separate income tax returns, including U.S. federal and state tax returns and foreign tax returns. The Company is subject to examination in the U.S. and various state and foreign jurisdictions for certain tax years. As a result of the Company’s ability to carryforward federal, state and foreign NOLs, the applicable tax years generally remain open to examination several years after the applicable loss carryforwards have been used or have expired. The Company regularly assesses the likelihood of additional assessments in each of the tax jurisdictions resulting from these examinations. The Company believes that adequate provisions have been made for income taxes for all periods through December 31, 2019.

                                                             |        | Year Ended December 31, |
------------------------------------------------------------ | ------ | ----------------------- | ------
                                                             | 2019   | 2018                    | 2017
Balance at January 1                                         | $107.7 | $116.7                  | $107.6
Additions based on tax positions related to the current year | 33.3   | 8.1                     | 7.6
Additions and reductions for tax positions of prior years    | 37.5   | 0.3                     | —
Foreign currency                                             | (1.6)  | (8.1)                   | 1.9
Reduction as a result of the lapse of statute of limitations | (1.3)  | (2.6)                   | (0.4)
Reduction as a result of effective settlements               | —      | (6.7)                   | —
Balance at December 31                                       | $175.6 | $107.7                  | $116.7

AMERICAN TOWER CORPORATION SUBSIDIARIES FINANCIAL STATEMENTS amounts millions
 expects unrecognized tax benefits change 12 months tax matters statute limitations lapses. impact zero to $53. million.
 reconciliation unrecognized tax benefits
 December 31, 2019 2018 2017 statute limitations lapsed positions settled $2. 5 million $9. 3 million $0. 4 million liability.
 recorded penalties tax-related interest expense $10. 3 million $8. million $5. million 2019 2018 2017. expiration statute limitations positions settled reduced liability penalties interest positions $2. 7 million $16. 2 million $0. 6 million.
 December 31, 2019 2018 total accrued income tax-related interest penalties consolidated balance sheets $26. 6 million $19. 1 million.
 Company filed consolidated income tax returns. federal state foreign. subject examination U. state foreign jurisdictions.Company’s carryforward federal state foreign NOLs tax years open after. assesses additional assessments tax. adequate provisions income taxes through December 31, 2019.
 Ended December 31,
 Balance January 1 $107. 7 $116. $107.
 Additions tax positions current 33. 3 8. 7.
 Additions reductions prior years 37. 5 0. 3
 Foreign currency (1. (8. 1.
 Reduction lapse statute limitations (1. (2.
 Reduction settlements (6.
 Balance December 31 $175. 6 $107. 7 $116.


NOTE 14. PROVISION FOR WARRANTY
The changes in the amount of provision for warranty are as follows:
Costs of warranty include the cost of labor and materials to repair a product during the warranty period. The main term of the warranty period is one year. The Company accrues for the estimated cost of the warranty on its products shipped in the provision for warranty, upon recognition of the sale of the product. The costs are estimated based on actual historical expenses incurred and on estimated future expenses related to current sales, and are updated periodically. Actual warranty costs are charged against the provision for warranty.

                                    | December 31, |
----------------------------------- | ------------ | --------
                                    | 2018         | 2019
Balance January 1                   | 6,562        | 7,955
Charged to cost of sales            | 18,408       | 26,301
Deductions                          | (8,985)      | (12,232)
Releases of expired warranty        | (8,214)      | (5,684)
Foreign currency translation effect | 184          | 84
Balance December 31                 | 7,955        | 16,424

14. PROVISION WARRANTY
 changes
 Costs include labor materials. one year. Company accrues estimated cost warranty products sale. costs estimated future expenses updated periodically. warranty costs charged against.
 December
 Balance January 1 6,562 7,955
 cost sales 18,408 26,301
 Deductions (8,985) (12,232)
 expired warranty (8,214) (5,684)
 Foreign currency translation effect 184
 Balance December 31 7,955 16,424


5. CASH FLOW ANALYSIS
(1) Fiscal 2018 was restated to comply with IFRS 15 and to reflect a change in accounting policy as well as to reclassify results from Cogeco Peer 1 as discontinued operations. For further details, please consult the "Accounting policies" and "Discontinued operations" sections.
(2) For further details on the Corporation's cash flow attributable to discontinued operations, please consult the "Discontinued operations" section.
Fiscal 2019 cash flow from operating activities increased by 39.9% compared to the prior year mainly from: • higher adjusted EBITDA; • the decreases in income taxes paid and in financial expense paid; and • the decrease in integration, restructuring and acquisitions costs.
Fiscal 2019 investing activities decreased by 78.5% compared to the prior year mainly due to the MetroCast acquisition of $1.76 billion in the second quarter of fiscal 2018.

Years ended August 31,                                                                         | 2019      | 2018 (1)    | Change
---------------------------------------------------------------------------------------------- | --------- | ----------- | ------
(in thousands of dollars, except percentages)                                                  | $         | $           | %
Cash flow from operating activities                                                            | 868,711   | 620,748     | 39.9
Cash flow from investing activities                                                            | (471,078) | (2,191,666) | (78.5)
Cash flow from financing activities                                                            | (659,222) | 1,426,136   | —
Effect of exchange rate changes on cash and cash equivalents denominated in a foreign currency | (439)     | 1,989       | —
Net change in cash and cash equivalents from continuing operations                             | (262,028) | (142,793)   | 83.5
Net change in cash and cash equivalent from discontinued operations(2)                         | 733,807   | 16,333      | —
Cash and cash equivalents, beginning of the year                                               | 84,725    | 211,185     | (59.9)
Cash and cash equivalents, end of the year                                                     | 556,504   | 84,725      | —

. CASH FLOW ANALYSIS
 Fiscal 2018 IFRS 15 change accounting policy results Cogeco Peer 1 discontinued operations. consult "Accounting policies "Discontinued operations sections.
 cash flow discontinued operations section.
 Fiscal 2019 cash flow increased. 9% higher EBITDA decreases income taxes financial expense integration restructuring acquisitions costs.
 investing activities decreased. 5% MetroCast acquisition $1. 76 billion.
 August 31,
 Cash flow operating activities 868,711 620,748.
 investing activities (471,078) (2,191,666).
 financing activities (659,222) 1,426,136
 Effect exchange rate changes cash equivalents foreign currency (439) 1,989
 Net change cash continuing operations (262,028) (142,793).
 discontinued 733,807 16,333
 equivalents 84,725 211,185.
 end year 556,504 84,725


Net revenue: Net revenue from our Energy segment for the year ended December 31, 2019 increased $18.3 million to $39.0 million from $20.7 million for the year ended December 31, 2018. The increase was primarily driven by the AFTC related to the 2018 and 2019 CNG sales that was recognized in the fourth quarter of 2019, inclusive of prior period AFTC at the acquired ampCNG stations which was also recognized in 2019. The increase was also driven by higher volume-related revenues from the recent acquisition of the ampCNG stations and growth in CNG sales volumes.
Cost of revenue: Cost of revenue from our Energy segment for the year ended December 31, 2019 increased $5.9 million to $17.1 million from $11.2 million for the year ended December 31, 2018. The increase was due to overall growth in volumes of gasoline gallons delivered and higher commodity and utility costs driven by the acquisition of ampCNG stations.
Selling, general and administrative: Selling, general and administrative expenses from our Energy segment for the year ended December 31, 2019 increased $0.9 million to $4.9 million from $4.0 million for the year ended December 31, 2018. The increase was driven by an increase in salaries and benefits largely due to the of the acquisition of ampCNG stations, which were acquired late in the second quarter of 2019, partially offset by a one-time expense in the prior year related to the abandonment of a station development project.
Depreciation and amortization from our Energy segment for the year ended December 31, 2019 increased $1.4 million to $6.9 million from $5.5 million for the year ended December 31, 2018. The increase was due to additional depreciation and amortization from the recent acquisition of ampCNG stations.
Other operating expense from our Energy segment was a loss of $0.5 million for the year ended December 31, 2018, driven by impairment of certain stations during the fourth quarter of 2018.

                                    |       | Years Ended December 31, |
----------------------------------- | ----- | ------------------------ | ---------------------
                                    | 2019  | 2018                     | Increase / (Decrease)
Net revenue                         | $39.0 | $20.7                    | $18.3
Cost of revenue                     | 17.1  | 11.2                     | 5.9
Selling, general and administrative | 4.9   | 4.0                      | 0.9
Depreciation and amortization       | 6.9   | 5.5                      | 1.4
Other operating expense             | —     | 0.5                      | (0.5)
Income (loss) from operations       | 10.1  | $(0.5)                   | $10.6

Net revenue Energy segment 2019 increased $18. 3 million to $39. 0 million from $20. 7 million 2018. driven AFTC 2018 2019 CNG sales recognized fourth quarter 2019 ampCNG stations. volume revenues acquisition ampCNG stations growth CNG sales volumes.
 Cost revenue Energy segment increased $5. 9 million to $17. 1 million from $11. 2 million 2018. growth gasoline gallons higher commodity utility costs ampCNG stations.
 Selling administrative expenses Energy segment increased $0. 9 million to $4. 9 million $4. 0 million. salaries benefits acquisition ampCNG stations offset one-time expense abandonment station development project.
 Depreciation amortization Energy segment increased $1. 4 million to $6. 9 million from $5. 5 million 2018. acquisition ampCNG stations.
 operating expense loss $0. 5 million 2018 impairment stations fourth quarter 2018.
 Net revenue $39.$18.
 revenue 17. 11.
 Selling administrative 4. 9.
 Depreciation amortization 6. 9 5. 5.
 operating expense. 5.
 Income operations 10. $10.


The Company’s estimated future benefit payments as of December 31, 2019 are as follows:
The Company has certain defined contribution plans, which accrue benefits for employees on a pro-rata basis during their employment period based on their individual salaries. The Company’s accrued benefits related to defined contribution pension plans of $20 million as of December 31, 2019 and $18 million as of December 31, 2018. The annual cost of these plans amounted to approximately $86 million in 2019, $84 million in 2018 and $77 million in 2017.

Years             | Pension Benefits | Other Long Term Benefits
----------------- | ---------------- | ------------------------
2020              | 32               | 7
2021              | 29               | 7
2022              | 32               | 5
2023              | 41               | 6
2024              | 51               | 9
From 2025 to 2029 | 272              | 35

estimated future benefit payments December 31, 2019
 defined contribution plans accrue benefits salaries. accrued benefits $20 million 2019 $18 million 2018. annual cost $86 million 2019 $84 million 2018 $77 million 2017.
 Pension Benefits Long Term Benefits
 2020
 2021
 2022
 2023
 2024
 2025 to 2029 272


Interest and Other Income (Expense)
Interest and other income (expense), net changed by $3.3 million from a net expense of $13.8 million in the year ended December 31, 2018 to a net expense of $10.4 million for the year ended December 31, 2019. The change in interest and other income (expense), net was primarily due to a decrease in interest expense pertaining to a lower average balance of debt outstanding under our term loan facility during the year.

                                         | Year Ended December 31, |                        | % Change
---------------------------------------- | ----------------------- | ---------------------- | --------
                                         | 2019                    | 2018                   | 2019
                                         |                         | (dollars in thousands) |
Interest and other income (expense), net | $(10,427)               | $(13,755)              | (24)%
% of net revenue                         | (3)%                    | (4)%                   |

Interest Income (Expense
 changed $3. 3 million $13. 8 million 31, 2018 to $10. 4 million 2019. due decrease interest expense lower average balance debt term loan.
 Year Ended December 31, % Change
 2019
 (dollars thousands)
 Interest income net $(10,427) $(13,755) (24)%
 net revenue (4)%


Teradyne determined the stock options’ expected life based upon historical exercise data for executive officers, the age of the executive officers and the terms of the stock option grant. Volatility was determined using historical volatility for a period equal to the expected life. The risk-free interest rate was determined using the U.S. Treasury yield curve in effect at the time of grant. Dividend yield was based upon an estimated annual dividend amount of $0.36 per share divided by Teradyne’s stock price on the grant date of $37.95 for the 2019 grants, $47.70 for the 2018 grants and $28.56 for the 2017 grants.
Stock compensation plan activity for the years 2019, 2018, and 2017, is as follows:

                                           | 2019    | 2018           | 2017
------------------------------------------ | ------- | -------------- | -------
                                           |         | (in thousands) |
Restricted Stock Units:                    |         |                |
Non-vested at January 1                    | 2,454   | 3,174          | 3,778
Awarded                                    | 1,139   | 790            | 939
Vested                                     | (1,237) | (1,382)        | (1,434)
Forfeited                                  | (87)    | (128)          | (109)
Non-vested at December31                   | 2,269   | 2,454          | 3,174
Stock Options:                             |         |                |
Outstanding at January 1                   | 506     | 531            | 926
Granted                                    | 102     | 69             | 111
Exercised                                  | (280)   | (94)           | (501)
Forfeited                                  | (7)     | —              | —
Expired                                    | (2)     | —              | (5)
Outstanding at December 31                 | 319     | 506            | 531
Vested and expected to vest at December 31 | 319     | 506            | 531
Exercisable at December 31                 | 85      | 256            | 233

Teradyne determined stock life exercise data age terms option grant. Volatility determined historical volatility equal life. risk-free interest rate determined U. Treasury yield curve. Dividend yield estimated annual dividend $0. 36 per share divided Teradyne’s stock price grant date $37. 95 2019 $47. 70 2018 $28. 56 2017.
 Stock compensation plan activity 2019 2018 2017
 Restricted Stock Units
 Non-vested January 1 2,454 3,174
 Awarded 1,139
 Vested
 Forfeited
 Non-vested December31 2,269 2,454 3,174
 Stock Options
 Outstanding January 1 506 531
 Granted
 Exercised
 Forfeited
 Expired
 Outstanding December 31 319 506
 Vested expected vest
 Exercisable


Stock options
The following tables summarize our stock option activities and related information:
(1) The aggregate intrinsic value represents the excess of the closing price of our common stock of $6.87 as of December 31, 2019 over theexercise price of the outstanding in-the-money options.

                                               | Number of Shares (thousands) | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term (years) | Aggregate Intrinsic Value(1) (thousands)
---------------------------------------------- | ---------------------------- | ------------------------------- | --------------------------------------------------- | ----------------------------------------
Outstanding as of December 31, 2018            | 4,674                        | $5.19                           |                                                     |
Granted                                        | —                            | $ —                             |                                                     |
Exercised                                      | (842)                        | $2.84                           |                                                     |
Canceled                                       | (130)                        | $9.41                           |                                                     |
Outstanding as of December 31, 2019            | 3,702                        | $5.57                           | 3.52                                                | $6,395
Vested and exercisable as of December 31, 2019 | 3,427                        | $5.49                           | 3.56                                                | $6,210

Stock options
 tables summarize stock option activities information
 aggregate intrinsic value excess closing price common stock $6. 87 December 31, 2019 over price options.
 Shares Exercise Price Contractual Term Intrinsic
 December 31, 2018 $5. 19
 Granted
 Exercised $2. 84
 Canceled $9. 41
 December 31, 2019 3,702 $5. $6,395
 Vested exercisable $5. $6,210


The fair value of options granted in the respective fiscal years are estimated on the date of grant using the Black-Scholes optionpricing model, acceptable under ASC 718, with the following weighted average assumptions:
Expected volatilities are based on the Company’s historical common stock volatility, derived from historical stock price data for periods commensurate with the options’ expected life. The expected life of options granted represents the period of time options are expected to be outstanding, based primarily on historical employee option exercise behavior. The risk-free interest rate is based on the implied yield currently available on U.S. Treasury zero coupon bonds issued with a term equal to the expected life at the date of grant of the options. The expected dividend yield is zero, as the Company has historically paid no dividends and does not anticipate dividends to be paid in the future.

                        | Years Ended December 31, |
----------------------- | ------------------------ | -----
                        | 2018                     | 2017
Expected life (years)   | 5.6                      | 5.6
Risk-free interest rate | 2.7%                     | 1.9%
Expected volatility     | 26.4%                    | 29.4%
Expected dividend yield | —                        | —

fair value options granted estimated Black-Scholes optionpricing model ASC 718 weighted average assumptions
 Expected volatilities based historical common stock volatility data life. life options employee behavior. risk-free interest rate based implied yield U. S. Treasury zero coupon bonds life. expected dividend yield zero Company no dividends.
 Years Ended December 31,
 Expected life (years 5. 6.
 Risk-free interest rate 2. 7% 1. 9%
 Expected volatility 26. 4% 29.
 Expected dividend yield


Issuer Purchases of Equity Securities
(a) During the fourth quarter of 2015, Lifeway publicly announced a share repurchase program. On November 1, 2017, the our Board of Directors amended the 2015 stock repurchase program (the “2017 amendment”), by adding to (i.e., exclusive of the shares previously authorized under the 2015 stock program repurchase) the authorization the lesser of $5,185 or 625 shares. The program has no expiration date.

Period                | Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of a publicly announced program (a) | Approximate Dollar Value of Shares that may yet be Purchased under the Plans or Programs ($ in thousands)
--------------------- | -------------------------------- | ---------------------------- | ---------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------
1/1/2018 to 1/31/2018 | 106,441                          | $ 8.22                       | 106,441                                                                      | $ 5,007
2/1/2018 to 2/28/2018 | 24,486                           | $ 7.21                       | 24,486                                                                       | $ 4,830
4/1/2018 to 4/30/2018 | 15,433                           | $ 6.09                       | 15,433                                                                       | $ 4,736
6/1/2018 to 6/30/2018 | 4,143                            | $ 5.46                       | 4,143                                                                        | $ 4,714
8/1/2018 to 8/31/2018 | 1,332                            | $ 3.96                       | 1,332                                                                        | $ 4,709
9/1/2018 to 9/30/18   | 40,364                           | $ 3.35                       | 40,364                                                                       | $ 4,573
11/1/2018 to 11/30/18 | 17,228                           | $ 2.99                       | 17,228                                                                       | $ 4,522
12/1/2018 to 12/31/18 | 8,305                            | $ 2.25                       | 8,305                                                                        | $ 4,503
Fiscal Year 2018      | 217,732                          | $ 6.33                       | 217,732                                                                      | $ 4,503
1/1/2019 to 1/31/2019 | 46,743                           | $ 2.54                       | 46,743                                                                       | $ 4,384
2/1/2019 to 2/28/2019 | 9,100                            | $ 2.75                       | 9,100                                                                        | $ 4,358
3/1/2019 to 3/31/2019 | 26,932                           | $ 2.24                       | 26,932                                                                       | $ 4,298
4/1/2019 to 4/30/2019 | 4,300                            | $ 2.24                       | 4,300                                                                        | $ 4,288
5/1/2019 to 5/31/2019 | 57,817                           | $ 2.49                       | 57,817                                                                       | $ 4,145
6/1/2019 to 6/30/2019 | 11,146                           | $ 2.32                       | 11,146                                                                       | $ 4,119
8/1/2019 to 8/31/2019 | 37,567                           | $ 2.69                       | 37,567                                                                       | $ 4,018
9/1/2019 to 9/30/2019 | 17,531                           | $ 2.98                       | 17,531                                                                       | $ 3,965
Fiscal Year 2019      | 211,136                          | $ 2.55                       | 211,136                                                                      | $ 3,965

Purchases Equity Securities
 fourth quarter 2015, Lifeway announced share repurchase program. November 1, 2017 Board Directors amended 2015 stock repurchase program adding. $5,185 625 shares. no expiration date.
 Total shares purchased Average price paid per share Approximate Dollar Value Shares
 1/1/2018 to 1/31/2018 106,441 $ 8.
 2/1/2018 to 2/28/2018 24,486 $.
 4/1/2018 4/30/2018 15,433.
 6/1/2018 6/30/2018 4,143.
 8/1/2018 8/31/2018 1,332 $.
 9/1/2018 to 9/30/18 40,364.
 11/1/2018 11/30/18 17,228.
 12/1/2018 12/31/18 8,305 $.
 2018 217,732.
 1/1/2019 to 1/31/2019 46,743.46,743 4,384
 2/1/2019 9,100. 4,358
 3/1/2019 26,932. 4,298
 4/1/2019 4/30/2019 4,300.
 5/1/2019 5/31/2019 57,817.
 6/1/2019 6/30/2019 11,146.
 8/1/2019 8/31/2019 37,567. 4,018
 9/1/2019 9/30/2019 17,531. 3,965
 2019 211,136. 3


Other Expense, Net
Other expense, net decreased by $4.3 million in 2018 compared to 2017 as a result of an increase in interest expense of $5.7 million related to interest expense due under our convertible senior notes. This increase was offset by an increase of $1.4 million of interest income earned on our short-term investments.

                   | Year Ended December 31, |                        | Change  |
------------------ | ----------------------- | ---------------------- | ------- | -------
                   | 2018                    | 2017                   | $       | %
                   |                         | (dollars in thousands) |         |
Other expense, net | $ 4,628                 | $ 302                  | $ 4,326 | 1432.5%
% of revenue       | 3%                      | 0%                     |         |

Expense Net
 decreased $4. million 2018 2017 interest expense $5. 7 million convertible senior notes. offset $1. 4 million interest income short-term investments.
 Ended December 31,
 2018 2017 %
 thousands
 expense net $ $ 4,326. 5%
 revenue 3% 0%


Backlog
As reflected in the table above, total backlog decreased $663.5 million from September 30, 2018 to September 30, 2019. The decrease in backlog is primarily due to progression of work in 2019 on four large contracts awarded to CTS in fiscal 2018. In addition, we recorded a net decrease to backlog of $104.5 million on October 1, 2018 for the impact of the adoption of ASC 606. Changes in exchange rates between the prevailing currency in our foreign operations and the U.S. dollar as of September 30, 2019 decreased backlog by $79.7 million compared to September 30, 2018.

                             | September 30,    | September 30,
---------------------------- | ---------------- | -----------------
                             | 2019             | 2018
                             |                  | (in millions)
Total backlog                |                  |
Cubic Transportation Systems | $  2,953.3       | $  3,544.9
Cubic Mission Solutions      | 103.7            | 77.0
Cubic Global Defense         | 344.0            | 442.6
Total                        | $  3,401.0       | $  4,064.5

 backlog decreased $663. 5 million September 30 2018 to 2019. due four contracts CTS. net decrease backlog $104. 5 million October 1, 2018 ASC 606. Changes exchange rates foreign. dollar September 30 2019 decreased backlog $79. 7 million 2018.
 millions
 Total backlog
 Transportation Systems $ 2,953. $ 3,544.
 Mission Solutions.
 Global Defense 344. 442.
 $ 3,401. $ 4,064.