Lines of Credit
The following table summarizes our available lines of credit and committed and uncommitted lines of credit, including the revolving credit facility discussed above, and the amounts available under our accounts receivable securitization programs.
(1) Includes total borrowings under the accounts receivable securitization programs, the revolving credit facility and borrowings under lines of credit available to several subsidiaries.
(2) Of the total available lines of credit, $1,137.4 million were committed as of December 31, 2019.

                                   | December 31, |
---------------------------------- | ------------ | ---------
(In millions)                      | 2019         | 2018
Used lines of credit (1)           | $ 98.9       | $ 232.8
Unused lines of credit             | 1,245.2      | 1,135.3
Total available lines of credit(2) | $ 1,344.1    | $ 1,368.1

 table summarizes committed uncommitted revolving credit facility amounts accounts receivable securitization programs.
 Includes borrowings programs revolving credit facility subsidiaries.
 lines $1,137. 4 million committed December 31, 2019.
 Used lines $ 98. 9 $ 232. 8
 Unused lines 1,245. 1,135. 3
 Total lines $ 1,344. $ 1,368.


The Group’s revenue mainly comprises the sale of goods in-store and online, and hospitality and leisure services. Revenue is recognised when control of the goods has transferred to the customer or when the service is provided at an amount that reflects the consideration to which the Group expects to be entitled.
For sale of goods in-store, control of the goods transfers to the customer at the point the customer purchases the goods in-store. For sale of goods online, control of the goods transfers to the customer at the point the goods are delivered to, or collected by, the customer. Where payment for the goods is received prior to control transferring to the customer, revenue recognition is deferred in contract liabilities within trade and other payables in the Consolidated Statement of Financial Position until the goods have been delivered to, or collected by, the customer.
Woolworths Rewards points granted by the Group provide customers with a material right to a discount on future purchases. The amounts allocated to Woolworths Rewards points are deferred in contract liabilities within trade and other payables in the Consolidated Statement of Financial Position until redeemed by the customer.

                                 | 2019     | 2018
-------------------------------- | -------- | --------
                                 | 53 WEEKS | 52 WEEKS
                                 | $M       | $M
Sale of goods in-store           | 54,720   | 52,533
Sale of goods online             | 2,534    | 1,883
Leisure and hospitality services | 1,671    | 1,612
Other                            | 1,059    | 916
Total                            | 59,984   | 56,944

Group’s revenue sale goods in-store online hospitality leisure services. Revenue recognised control transferred to customer or service provided amount consideration.
 in-store control transfers to customer. online control transfers delivered. payment received prior control revenue recognition deferred in liabilities until goods delivered.
 Woolworths Rewards points provide right discount future purchases. deferred in liabilities until redeemed by customer.
 2019  2018
 53 WEEKS 52 WEEKS
 $M
 in-store 54,720  52,533
 online 2,534  1,883
 Leisure hospitality services 1,671  1,612
 Other 1,059  916
 Total  59,984 | 56,944


KEY PERFORMANCE INDICATORS
Below is a summary of some of the quantitative performance indicators (as defined below) that are evaluated by management to assess our financial performance. Some of the indicators are non-GAAP measures and should not be considered as an alternative to any other measure for determining operating performance or liquidity that is calculated in accordance with generally accepted accounting principles.
Definitions and analysis of these performance indicators are as follows:
Net Sales Net sales include sales of lasers, laser systems, related accessories and service. Net sales for fiscal 2019 decreased 29.6% in our OLS segment and decreased 15.4% in our ILS segment from fiscal 2018. For a description of the reasons for changes in net sales refer to the ‘‘Results of Operations’’ section below.
Gross Profit as a Percentage of Net Sales Gross profit as a percentage of net sales (‘‘gross profit percentage’’) is calculated as gross profit for the period divided by net sales for the period. Gross profit percentage for OLS decreased to 47.3% in fiscal 2019 from 52.7% in fiscal 2018. Gross profit percentage for ILS decreased to 13.3% in fiscal 2019 from 26.7% in fiscal 2018. For a description of the reasons for changes in gross profit refer to the ‘‘Results of Operations’’ section below.
Research and Development as a Percentage of Net Sales Research and development as a percentage of net sales (‘‘R&D percentage’’) is calculated as research and development expense for the period divided by net sales for the period. Management considers R&D percentage to be an important indicator in managing our business as investing in new technologies is a key to future growth. R&D percentage increased to 8.2% in fiscal 2019 from 7.0% in fiscal 2018. For a description of the reasons for changes in R&D spending refer to the ‘‘Results of Operations’’ section below.
Net Cash Provided by Operating Activities Net cash provided by operating activities shown on our Consolidated Statements of Cash Flows primarily represents the excess of cash collected from billings to our customers and other receipts over cash paid to our vendors for expenses and inventory purchases to run our business. We believe that cash flows from operations is an important performance indicator because cash generation over the long term is essential to maintaining a healthy business and providing funds to help fuel growth. For a description of the reasons for changes in Net Cash Provided by Operating Activities refer to the ‘‘Liquidity and Capital Resources’’ section below.
Days Sales Outstanding in Receivables We calculate days sales outstanding (‘‘DSO’’) in receivables as net receivables at the end of the period divided by net sales during the period and then multiplied by the number of days in the period, using 360 days for years. DSO in receivables indicates how well we are managing our collection of receivables, with lower DSO in receivables resulting in higher working capital availability. The more money we have tied up in receivables, the less money we have available for research and development, acquisitions, expansion, marketing and other activities to grow our business. Our DSO in receivables for fiscal 2019 remained unchanged at 67 days as compared to fiscal 2018.
Annualized Fourth Quarter Inventory Turns We calculate annualized fourth quarter inventory turns as cost of sales during the fourth quarter annualized and divided by net inventories at the end of the fourth quarter. This indicates how well we are managing our inventory levels, with higher inventory turns resulting in more working capital availability and a higher return on our investments in inventory. Our annualized fourth quarter inventory turns for fiscal 2019 decreased to 2.1 turns from 2.2 turns in fiscal 2018 primarily as a result of a decrease in demand for sales of our large ELA tools, partially offset by the impact of lower inventories due to restructuring charges.
Adjusted EBITDA as a Percentage of Net Sales We define adjusted EBITDA as operating income adjusted for depreciation, amortization, stock compensation expense, major restructuring costs and certain other non-operating income and expense items, such as costs related to our acquisitions. Key initiatives to reach our goals for EBITDA improvements include utilization of our Asian manufacturing locations, optimizing our supply chain and continued leveraging of our infrastructure.
We utilize a number of different financial measures, both GAAP and non-GAAP, such as adjusted EBITDA as a percentage of net sales, in analyzing and assessing our overall business performance, for making operating decisions and for forecasting and planning future periods. We consider the use of non-GAAP financial measures helpful in assessing our current financial performance and ongoing operations. While we use non-GAAP financial measures as a tool to enhance our understanding of certain aspects of our financial performance, we do not consider these measures to be a substitute for, or superior to, the information provided by GAAP financial measures. We provide adjusted EBITDA in order to enhance investors’ understanding of our ongoing operations. This measure is used by some investors when assessing our performance.

                                                                      | Fiscal   |
--------------------------------------------------------------------- | -------- | ----------
                                                                      | 2019     | 2018
Net Sales - OEM Laser Sources                                         | $886,676 | $1,259,477
Net Sales - Industrial Lasers & Systems                               | $543,964 | $643,096
Gross Profit as a Percentage of Net Sales—OEM Laser Sources           | 47.3%    | 52.7%
Gross Profit as a Percentage of Net Sales—Industrial Lasers & Systems | 13.3%    | 26.7%
Research and Development Expenses as a Percentage of Net Sales        | 8.2%     | 7.0%
Income From Continuing Operations Before Income Taxes                 | $60,048  | $361,555
Net Cash Provided by Operating Activities                             | $181,401 | $236,111
Days Sales Outstanding in Receivables                                 | 67       | 67
Annualized Fourth Quarter Inventory Turns                             | 2.1      | 2.2
Net Income From Continuing Operations as a Percentage of Net Sales    | 3.8%     | 13.0%
Adjusted EBITDA as a Percentage of Net Sales                          | 18.1%    | 28.9%

PERFORMANCE INDICATORS
 summary quantitative performance indicators evaluated management financial performance. indicators non-GAAP not alternative operating performance liquidity accounting principles.
 Definitions indicators
 Net Sales include lasers systems accessories service. 2019 decreased 29. 6% OLS 15. 4% ILS from 2018. reasons changes ‘‘Results of Operations’’ section.
 Gross Profit Percentage Net Sales calculated divided by net sales. OLS decreased to 47. 3% 2019 from 52. 7% 2018. ILS decreased to 13. 3% 2019 from 26. 7% 2018. changes ‘‘Results of.
 Research and Development Percentage Net Sales calculated expense divided by net sales. important investing new technologies key future growth. R&D percentage increased to 8. 2% 2019 from 7. 0% 2018. reasons changes R&D spending ‘‘Results of.
 Net Cash Operating Activities excess cash from billings receipts over cash paid vendors expenses inventory purchases.cash flows operations important performance indicator essential healthy business growth. changes Net Cash Activities ‘‘Liquidity Capital section.
 Days Sales Outstanding Receivables calculate outstanding net receivables divided by sales multiplied days. lower higher working capital availability. more money tied receivables less money for research development acquisitions expansion marketing. DSO fiscal 2019 unchanged 67 days 2018.
 Annualized Fourth Quarter Inventory Turns calculate turns cost sales divided by net inventories. inventory higher inventory turns more working capital availability higher return investments. quarter inventory turns 2019 decreased to 2. 1 turns from. 2018 decrease demand large tools offset lower inventories restructuring charges.
 Adjusted EBITDA Percentage Net Sales operating income adjusted for depreciation amortization stock compensation expense restructuring costs non-operating income items. initiatives EBITDA improvements include Asian manufacturing locations optimizing supply chain leveraging infrastructure.
utilize financial measures GAAP non-GAAP adjusted EBITDA sales business performance decisions forecasting future.-GAAP current performance. GAAP. adjusted EBITDA understanding. used investors performance.
 Net Sales OEM Laser Sources $886,676 $1,259,477
 Net Sales Industrial Lasers Systems $543,964 $643,096
 Gross Profit 47. 3% 52. 7%
 Gross Profit 13. 3% 26. 7%
 Research Development Expenses Net Sales 8. 2% 7. 0%
 Income Continuing Operations Before Income Taxes $60,048 $361,555
 Net Cash Operating Activities $181,401 $236,111
 Sales Outstanding Receivables
 Fourth Quarter Inventory Turns.
 Net Income Continuing Operations Net Sales 3. 8% 13. 0%
 Adjusted EBITDA Net Sales 18. 1% 28. 9%


5. Accrued expenses
Accrued expenses consisted of the following:

October 31,                  |         |
---------------------------- | ------- | -------
                             | 2019    | 2018
(In thousands)               |         |
Workers’ compensation claims | $9,687  | $9,020
Accrued wages                | 19,525  | 14,142
Accrued rebates              | 13,529  | 7,828
Accrued vacation             | 10,592  | 8,554
Accrued property taxes       | 11,331  | 9,453
Accrued payroll taxes        | 8,290   | 9,034
Other accrued expenses       | 9,986   | 11,922
Total accrued expenses       | $82,940 | $69,953

. Accrued expenses
 Workers’ compensation $9,687 $9,020
 wages 19,525 14,142
 rebates 13,529 7,828
 vacation 10,592
 property taxes 11,331 9,453
 payroll taxes,034
 9,986 11,922
 $82,940 $69,953


ALTERNATIVE PERFORMANCE MEASURES – continued
Liquidity: TORM defines liquidity as available cash, comprising cash and cash equivalents, including restricted cash, as well as undrawn credit facilities.
TORM finds the APM important as the liquidity expresses TORM’s financial position, ability to meet current liabilities and cash buffer. Furthermore, it expresses TORM’s ability to act and invest when possibilities occur.

USDm                                                 | 2019  | 2018  | 2017
---------------------------------------------------- | ----- | ----- | -----
Cash and cash equivalents, including restricted cash | 72.5  | 127.4 | 134.2
Undrawn credit facilities                            | 173.1 | 278.7 | 270.7
Liquidity                                            | 245.6 | 406.1 | 404.9

PERFORMANCE MEASURES
 Liquidity TORM defines available cash equivalents restricted cash undrawn credit facilities.
 expresses financial position liabilities cash buffer. act invest possibilities.
 2019
 Cash equivalents restricted cash 72. 127. 134.
 Undrawn credit facilities 173. 278. 270.
 Liquidity 245. 404.


It rewards executives subject to performance against three equally weighted measures over a three year performance period:
Relative TSR is used as a measure in our LTI plan to align executive outcomes and long‐term shareholder value creation. The peer group is the ASX30 excluding metals and mining companies. Peer group ranking at the 75th percentile or higher 100% vesting is achieved and ranking at the median 50% vesting is achieved. Between the 75th  and median, pro-rata vesting is achieved from 50% to 100%. Peer group ranking below the median results in zero vesting.
Sales per square metre measures sales productivity improvements across the Food and Drinks businesses. Efficient use of our physical network for in‐store and online sales is core to our success.
ROFE is an important measures to drive behaviours consistent with the delivery of long‐term shareholder value. ROFE improvements can be delivered through earnings growth as well as the disciplined allocation of capital and management of assets, which is important for a business that is building capabilities for the future. Lease‐adjusted ROFE measures the balance between our earnings growth and the disciplined allocation and application of assets used to generate those earnings. We adjust for leases to recognise that a very significant portion of our sites are leased. This approach is also similar to the accounting standard definition of ROFE that will change to incorporate a lease-adjusted definition from F20.
The Sales/SQM and ROFE targets are published following the end of the performance period given the commercial sensitivity of this information.

        | rTSR   | SALES/SQM | ROFE
------- | ------ | --------- | ------
Entry   | 16.66% | 6.66%     | 6.66%
Target  | n/a    | 20%       | 20%
Stretch | 33.33% | 33.33%    | 33.33%

rewards executives three measures three year
 Relative TSR LTI plan executive outcomes shareholder value. peer group ASX30 metals mining companies. ranking 75th percentile higher 100% vesting median 50%. Between 75th median pro-rata vesting 50% to 100%. below median zero vesting.
 Sales per square metre measures sales productivity Food Drinks businesses. physical network in‐store online sales success.
 ROFE long‐term shareholder value. improvements earnings growth disciplined allocation capital management assets. Lease‐adjusted ROFE balance earnings growth disciplined allocation application assets. leases significant sites leased. similar accounting standard definition ROFE lease-adjusted definition F20.
 Sales/SQM ROFE targets published performance period.
 rTSR SALES/SQM ROFE
. 66%.
 33. 33%.


The following table compares our other consolidated operating results for 2019 and 2018:
Interest expense. Interest expense increased to $279.1 million in 2019, compared to $254.1 million in 2018, primarily due to: • an increase of $29.9 million primarily to the commencement of Teekay LNG's finance lease obligations upon the deliveries of the Myrina, Megara and Yamal Spirit LNG carriers and an increase in debt balance to pay for the final newbuilding installments on the Bahrain Spirit and Sean Spirit LNG carrier newbuilding deliveries;
• an increase of $6.7 million primarily due to the additional interest expense incurred by Teekay Tankers with respect to three sale-leaseback financing transactions completed in September 2018, November 2018 and May 2019; and • an increase of $6.3 million due to decreases in capitalized interest in Teekay LNG in 2019 as a result of vessels delivered during 2018 and 2019;
• an increase of $6.7 million primarily due to the additional interest expense incurred by Teekay Tankers with respect to three sale-leaseback financing transactions completed in September 2018, November 2018 and May 2019; and • an increase of $6.3 million due to decreases in capitalized interest in Teekay LNG in 2019 as a result of vessels delivered during 2018 and 2019;
• a decrease of $4.1 million relating to interest incurred by Teekay Parent in 2018 as a result of the prepayment of the outstanding amounts under one revolving credit facility and lower debt issuance cost amortization in 2019 on an amendment of another revolving credit facility.
Realized and unrealized (losses) gains on non-designated derivative instruments. Realized and unrealized (losses) gains related to derivative instruments that are not designated as hedges for accounting purposes are included as a separate line item in the consolidated statements of loss. Net realized and unrealized losses on non-designated derivatives were $13.7 million for 2019, compared to $14.9 million for 2018, as detailed in the table below:
The realized losses relate to amounts we actually realized for settlements related to these derivative instruments in normal course and amounts
paid to terminate interest rate swap agreement terminations.
During 2019 and 2018, we had interest rate swap agreements with aggregate average net outstanding notional amounts of approximately $1.1 billion and $1.3 billion, respectively, with average fixed rates of approximately 3.0% and 2.9%, respectively. Short-term variable benchmark interest rates during these periods were generally less than 3.0% and, as such, we incurred realized losses of $8.3 million and $13.9 million during 2019 and 2018, respectively, under the interest rate swap agreements.
We did not incur any realized losses related to the termination of interest rate swaps in 2019, compared to realized losses of $13.7 million during 2018. Primarily as a result of significant changes in long-term benchmark interest rates during 2019 and 2018, we recognized unrealized losses of $7.9 million in 2019 compared to unrealized gains of $33.7 million in 2018 under the interest rate swap agreements.
During the year ended December 31, 2019, we recognized a reversal of previously unrealized losses of $26.9 million on all the warrants held by Teekay to purchase common units of Altera (or the Warrants) as a result of the sale of the Warrants to Brookfield, and we concurrently recognized a realized loss of $25.6 million during the same period. During the year ended December 31, 2018, we recognized unrealized losses of $21.1 million on the Warrants. Please read “Item 18 – Financial Statements: Note 12 – Fair Value Measurements and Financial Instruments.”
Foreign Exchange Loss. Foreign currency exchange losses were $13.6 million in 2019 compared to gains of $6.1 million in 2018. Our foreign currency exchange gains and losses, substantially all of which are unrealized, are primarily due to the relevant period-end revaluation of our Norwegian-Krone (or NOK)-denominated debt and our Euro-denominated term loans, finance leases and restricted cash for financial reporting purposes and the realized and unrealized (losses) gains on our cross currency swaps.
Gains on NOK-denominated and Euro-denominated monetary liabilities reflect a stronger U.S. Dollar against the NOK and Euro on the date of revaluation or settlement compared to the rate in effect at the beginning of the period. Losses on NOK-denominated and Euro-denominated monetary liabilities reflect a weaker U.S. Dollar against the NOK and Euro on the date of revaluation or settlement compared to the rate in effect at the beginning of the period.
For 2019, foreign currency exchange loss included realized losses of $5.1 million (2018 – $6.5 million) and unrealized losses of $13.2 million (2018 – gains of $21.2 million) on our cross currency swaps, realized losses on maturity and termination of cross currency swaps of $nil (2018 – $42.3 million) and unrealized gains of $5.8 million (2018 – gains of $19.2 million) on the revaluation of our NOK-denominated debt.
Loss on deconsolidation of Altera. Loss on deconsolidation of Altera was $7.1 million in 2018. Please read "Item 18 – Financial Statements: Note 4 – Deconsolidation and Sale of Altera."
Other loss. Other loss was $14.5 million in 2019 compared to $2.0 million in 2018. Other loss in 2019 was primarily due to losses of $10.6 million on the repurchase of 2020 Notes, $2.0 million tax expense on Teekay LNG's income from U.S. sources and $1.4 million losses relating to Teekay LNG's sale lease-back refinancing of the Torben Spirit completed in 2019. Other loss in 2018 included $1.8 million related to repurchases of the 2020 Notes and $0.6 million related to the tax indemnification guarantee liability related to the Teekay Nakilat finance lease.
Income Tax Expense. Income tax expense was $25.5 million in 2019 compared to $19.7 million in 2018. This increase in income tax expense was primarily due to changes to freight tax accruals in 2019.

                                                                        | Year Ended December 31, |
----------------------------------------------------------------------- | ----------------------- | ---------
(in thousands of U.S. dollars, except percentages)                      | 2019                    | 2018
Interest expense                                                        | (279,059)               | (254,126)
Interest income                                                         | 7,804                   | 8,525
Realized and unrealized losses on non-designated derivative instruments | (13,719)                | (14,852)
Foreign exchange (loss) gain                                            | (13,574)                | 6,140
Loss on deconsolidation of Altera                                       | —                       | (7,070)
Other loss                                                              | (14,475)                | (2,013)
Income tax expense                                                      | (25,482)                | (19,724)

table compares consolidated operating results 2019 2018:
 Interest expense. increased $279. 1 million 2019 $254. 1 million 2018 due increase $29. 9 million Teekay LNG finance lease obligations Myrina Megara Yamal Spirit LNG increase debt balance Bahrain Spirit Sean Spirit LNG
 increase $6. 7 million additional interest expense Teekay Tankers sale-leaseback financing transactions September May 2019 increase $6. 3 million decreases capitalized interest vessels delivered
 increase $6. 7 million additional interest expense transactions increase $6. 3 million decreases capitalized interest vessels delivered
 decrease $4. 1 million interest Teekay Parent 2018 prepayment amounts revolving credit facility lower debt issuance cost amortization 2019 amendment credit facility.
 Realized unrealized gains non-designated derivative instruments. statements loss. Net losses $13. 7 million 2019 $14. 9 million 2018
 losses relate settlements instruments
interest rate swap terminations.
 2019 2018 net amounts $1. 1 billion $1. 3 billion fixed rates 3. 0% 2. 9%. Short-term interest rates less than 3. 0% incurred losses $8. 3 million $13. 9 million 2018.
 losses termination 2019 $13. 7 million 2018. changes long interest rates unrealized losses $7. 9 million 2019 gains $33. 7 million 2018.
 December 31, 2019 unrealized losses $26. 9 million warrants Teekay Altera loss $25. 6 million. 2018 unrealized losses $21. 1 million Warrants. 18 Financial Statements Note 12 Fair Value Measurements Financial Instruments.
 Foreign Exchange. losses $13. 6 million 2019 gains $6. 1 million 2018. gains losses due revaluation Norwegian debt Euro-denominated loans finance leases restricted cash gains cross currency swaps.
Gains NOK Euro liabilities stronger. Dollar. Losses weaker. Dollar.
 2019 exchange loss losses $5. 1 million (2018 $6. 5 million unrealized losses $13. 2 million $21. 2 million swaps losses $42. 3 million unrealized gains $5. 8 million $19. 2 million revaluation NOK debt.
 Loss deconsolidation Altera. $7. 1 million 2018.
. $14. 5 million 2019 $2. 0 million 2018. due $10. 6 million repurchase 2020 Notes $2. 0 million tax expense Teekay LNG income. $1. 4 million losses Teekay LNG sale refinancing. loss 2018 $1. 8 million repurchases 2020 Notes $0. 6 million tax indemnification liability Teekay Nakilat finance lease.
 Tax. $25. 5 million 2019 $19. 7 million 2018. due freight tax accruals.

.
 Interest expense (279,059) (254,126
 income
 losses instruments (13,719)
 exchange (13,574 6,140
 Loss deconsolidation Altera (7,070
 loss (14,475)
 Income tax expense (25,482) (19,724)


Operating Results – Teekay Tankers
The following table compares Teekay Tankers’ operating results, equity income and number of calendar-ship-days for its vessels for 2019 and 2018.
(1) Calendar-ship-days presented relate to owned and in-chartered consolidated vessels.
Teekay Tankers' income from vessel operations increased to $123.9 million in 2019 compared to $7.2 million in 2018, primarily as a result of: • an increase of $129.3 million due to higher overall average realized spot tanker rates earned by Teekay Tankers' Suezmax, Aframax and LR2 product tankers; • an increase of $3.5 million due to improved net results from Teekay Tankers' full service lightering (or FSL) activities from more voyage days and higher realized spot rates earned;
• an increase of $3.4 million resulting from lower general and administrative expenses primarily due to non-recurring project expenses incurred in 2018; • a net increase of $2.3 million primarily due to the delivery of three Aframax and two LR2 chartered-in tankers in late 2018 and throughout 2019, partially offset by the redeliveries of various in-chartered tankers to their owners in the second and third quarters of 2018; and • an increase of $1.2 million as a result of restructuring charge incurred in the prior year;
partially offset by
• a decrease of $10.2 million due to a higher number of off-hire days in 2019 resulting from dry dockings and higher off-hire bunker expenses compared to the prior year; • a decrease of $6.9 million due to lower revenues and loss on the sale of one Suezmax tanker in 2019 and the write-down of two Suezmax tankers that were classified as held for sale at December 31, 2019; and • a decrease of $6.4 million due to the amortization of first dry dockings for various former Tanker Investments Ltd. (or TIL) vessels subsequent to Teekay Tankers' acquisition of TIL in late 2017.
Equity income increased to $2.3 million in 2019 from $1.2 million in 2018 primarily due to higher earnings recognized in 2019 from the High-Q Investment Ltd. joint venture as a result of higher spot rates earned in 2019.

                                                          | Year Ended December 31, |
--------------------------------------------------------- | ----------------------- | ---------
(in thousands of U.S. dollars, except calendar-ship-days) | 2019                    | 2018
Revenues                                                  | 943,917                 | 776,493
Voyage expenses                                           | (402,294)               | (381,306)
Vessel operating expenses                                 | (208,601)               | (209,131)
Time-charter hire expense                                 | (43,189)                | (19,538)
Depreciation and amortization                             | (124,002)               | (118,514)
General and administrative expenses                       | (36,404)                | (39,775)
Write-down and loss on sale of vessels                    | (5,544)                 | 170
Restructuring charges                                     | —                       | (1,195)
Income from vessel operations                             | 123,883                 | 7,204
Equity income                                             | 2,345                   | 1,220
Calendar-Ship-Days (1)                                    |                         |
Conventional Tankers                                      | 22,350                  | 21,226

Results Teekay Tankers
 table compares operating results equity income calendar-ship-days 2019 2018.
-ship-days in-chartered vessels.
 income increased $123. 9 million 2019 $7. 2 million 2018 increase $129. 3 million higher tanker rates Suezmax Aframax LR2 increase $3. 5 million improved net results full lightering more voyage days higher rates
 increase $3. 4 million lower administrative expenses non project expenses net increase $2. 3 million delivery three Aframax two LR2 tankers offset redeliveries tankers increase $1. 2 million restructuring charge
 decrease $10. 2 million higher off-hire days 2019 higher expenses decrease $6. 9 million lower revenues loss sale Suezmax tanker write-down two tankers decrease $6. 4 million amortization dry dockings. acquisition 2017.
 Equity income increased $2. 3 million 2019 $1. 2 million 2018 higher earnings High-Q Investment Ltd.venture spot rates 2019.
 Ended December
.-ship-days
 Revenues 943,917 776,493
 Voyage (402,294)
 Vessel operating,601,131
 Time-charter hire (43,189
 Depreciation amortization (124,002)
 administrative expenses (36,404),775
 loss sale vessels
 Restructuring charges
 Income vessel operations 123,883
 Equity income
 Calendar-Ship-Days
 Conventional Tankers 22,350


Item 6. Selected Financial Data
Various factors affecting the comparability of the information included in the table above are discussed in Management’s Discussion and Analysis of Financial Condition and Results of Operations.

                                         |            |            | Year Ended October 31,                 |            |
---------------------------------------- | ---------- | ---------- | -------------------------------------- | ---------- | ----------
                                         | 2019       | 2018       | 2017                                   | 2016       | 2015
                                         |            |            | (In thousands, except per share data)  |            |
Net sales                                | $3,440,258 | $3,236,004 | $3,342,226                             | $2,816,057 | $2,803,480
Operating income                         | 67,994     | 29,700     | 425,239                                | 294,111    | 335,998
Net income                               | 53,294     | 61,431     | 279,745                                | 188,961    | 216,001
Basic earnings per share                 | 2.41       | 2.70       | 12.30                                  | 8.37       | 9.52
Diluted earnings per share               | 2.41       | 2.70       | 12.30                                  | 8.37       | 9.52
Working capital                          | 365,430    | 367,600    | 650,817                                | 465,135    | 396,834
Total assets                             | 1,774,134  | 1,659,440  | 1,733,243                              | 1,422,700  | 1,246,752
Long-term debt, less current maturities  | 55,000     | —          | —                                      | —          | —
Stockholders’ equity                     | 1,417,675  | 1,387,893  | 1,432,862                              | 1,190,262  | 1,029,861
Cash dividends declared per share        | $1.28      | $1.28      | $2.04                                  | $1.90      | $1.38

. Financial Data
 factors discussed Financial Condition Results Operations.
 Ended October 31,
 2019 2015
 Net sales $3,440,258,236,004,342,226 $2,816,057 $2,803,480
 Operating income 67,994 425,239 294,111 335,998
 Net income 53,294 61,431 279,745 188,961 216,001
 earnings share 2.
 earnings share 2.
 Working capital 365,430,600 650,817 465,135 396,834
 Total assets 1,774,134 1,659,440 1,733,243 1,422,700 1,246,752
 Long-term debt maturities
 Stockholders’ equity 1,417,675 1,387,893 1,432,862 1,190,262 1,029,861
 Cash dividends $1.


Our product categories are:
Drinkable Kefir, sold in a variety of organic and non-organic sizes, flavors, and types, including low fat, non-fat, whole milk, protein, and BioKefir (a 3.5 oz. kefir with additional probiotic cultures).
European-style soft cheeses, including farmer cheese in resealable cups.
Cream and other, which consists primarily of cream, a byproduct of making our kefir.
ProBugs, a line of kefir products designed for children.
Other Dairy, which includes Cupped Kefir and Icelandic Skyr, a line of strained kefir and yogurt products in resealable cups.
Frozen Kefir, available in soft serve and pint-size containers.
Lifeway has determined that it has one reportable segment based on how our chief operating decision maker manages the business and in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing our performance, has been identified collectively as the Chief Financial Officer, the Chief Operating Officer, the Chief Executive Officer, and Chairperson of the board of directors. Substantially all of our consolidated revenues relate to the sale of cultured dairy products that we produce using the same processes and materials and are sold to consumers through a common network of distributors and retailers in the United States.
Net sales of products by category were as follows for the years ended December 31:
(a) Includes Lifeway Kefir Shop sales
Significant Customers – Sales are predominately to companies in the retail food industry located within the United States. Two major customers accounted for approximately 22% and 21% of net sales for the years ended December 31, 2019 and 2018, respectively. Two major customers accounted for approximately 17% of accounts receivable as of December 31, 2019 and 2018. Our ten largest customers as a group accounted for approximately 57% and 59% of net sales for the years ended December 31, 2019 and 2018, respectively.

                                   |          | 2019 |           | 2018
---------------------------------- | -------- | ---- | --------- | ----
In thousands                       | $        | %    | $         | %
Drinkable Kefir other than ProBugs | $ 71,822 | 77%  | $ 78,523  | 76%
Cheese                             | 11,459   | 12%  | 11,486    | 11%
Cream and other                    | 4,228    | 4%   | 5,276     | 5%
ProBugs Kefir                      | 2,780    | 3%   | 2,795     | 3%
Other dairy                        | 1,756    | 2%   | 3,836     | 4%
Frozen Kefir (a)                   | 1,617    | 2%   | 1,434     | 1%
Net Sales                          | $ 93,662 | 100% | $ 103,350 | 100%

product categories
 Drinkable Kefir organic non-organic sizes flavors types low fat non-fat whole milk protein BioKefir 3. 5 oz. kefir probiotic cultures.
 European-style soft cheeses farmer cheese resealable cups.
 Cream cream kefir.
 ProBugs kefir children.
 Other Dairy Cupped Kefir Icelandic Skyr strained kefir yogurt resealable cups.
 Frozen Kefir soft serve pint-size containers.
 Lifeway reportable segment chief operating decision. Chief Financial Officer Chief Operating Officer Chief Executive Officer Chairperson board of directors. consolidated revenues cultured dairy products sold distributors retailers United States.
 Net sales by category December 31
 Includes Lifeway Kefir Shop sales
 retail food industry United States. Two major customers 22% 21% of net sales 2019 2018. major customers 17% accounts receivable. ten largest customers 57% and 59% of net sales.
Kefir 71,822 77% 78,523 76%
 Cheese 11,459
 Cream 4,228 4% 5,276 5%
 ProBugs Kefir 2,780
 Other dairy 1,756
 Frozen Kefir 1,617
 Net Sales $ 93,662,350


Deferred tax assets and liabilities reflect the net tax effects of net operating loss carryovers and the temporary differences between the assets and liabilities carrying value for financial reporting and the amounts used for income tax purposes. The Company’s significant deferred tax assets (liabilities) components are as follows:
In assessing the ability to realize the Company’s net deferred tax assets, management considers various factors including taxable income in carryback years, future reversals of existing taxable temporary differences, tax planning strategies, and future taxable income projections to determine whether it is more likely than not that some portion or all of the net deferred tax assets will not be realized.
Based on the negative evidence, including the worldwide cumulative losses that the Company has incurred, the Company has determined that the uncertainty regarding realizing its deferred tax assets is sufficient to warrant the need for a full valuation allowance against its worldwide net deferred tax assets.
The $4.3 million net increase in the valuation allowance from 2018 to 2019 is primarily due to operating losses incurred and windfall tax benefits on equity awards in the current year, partially offset by the reduction in valuation allowance as a result of recording a net deferred tax liability associated with the adoption of ASC 606. In addition, the Company recognized a tax benefit of $1.0 million for the release of a portion of the Company’s pre-existing U.S. and U.K. valuation allowances as a result of the Ataata and Simply Migrate business combinations.
During the third quarter of fiscal 2018, the Tax Cuts and Jobs Act (the Act) was enacted in the United States. In addition, the Securities and Exchange Commission issued guidance under Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118) that directed taxpayers to consider the impact of the U.S. legislation as “provisional” when it did not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the change in tax law.
During 2019, the Company has completed its accounting for the tax effects of the enactment of the Act. During the year ended March 31, 2019, the Company recognized an immaterial adjustment to the provisional estimate recorded related to the Act in the Company’s fiscal 2018 financial statements.
As of March 31, 2019, the Company had U.K. net operating loss carryforwards of approximately $57.4 million that do not expire. As of March 31, 2019, the Company had U.S. federal net operating loss carryforwards of approximately $78.6 million. U.S. federal net operating loss carryforwards generated through March 31, 2017 of approximately $32.5 million expire at various dates through 2037, and U.S. federal net operating loss carryforwards generated in the tax years beginning after March 31, 2017 of approximately $46.1 million do not expire.
As of March 31, 2019, the Company had U.S. state net operating loss carryforwards of approximately $54.6 million that expire at various dates through 2039. As of March 31, 2019, the Company had Australian net operating loss carryforwards of approximately $23.9 million that do not expire. As of March 31, 2019, the Company had German net operating loss carryforwards of approximately $9.9 million that do not expire.
As of March 31, 2019, the Company had Israeli net operating loss carryforwards of approximately $3.3 million that do not expire. As of March 31, 2019, the Company had a U.K. income tax credit carryforward of $1.1 million that does not expire. As of March 31, 2019, the Company had Israeli income tax credit carryforwards of $0.6 million that expires in 2023 and 2024.
Under Section 382 of the U.S. Internal Revenue Code, if a corporation undergoes an ownership change, the corporation’s ability to use its pre-change net operating loss carryforwards to offset its post-change income and taxes may be limited. In general, an ownership change occurs if there is a 50 percent cumulative change in ownership of the Company over a rolling three-year period. Similar rules may apply under U.S. state tax laws.
The Company believes that it has experienced an ownership change in the past and may experience ownership changes in the future resulting from future transactions in our share capital, some of which may be outside the Company’s control. The Company’s ability to utilize its net operating loss carryforwards or other tax attributes to offset U.S. federal and state taxable income in the future may be subject to future limitations.
As of March 31, 2019 and 2018, the Company had liabilities for uncertain tax positions of $6.0 million and $6.2 million, respectively, none of which, if recognized, would impact the Company’s effective tax rate.

                                        | As of March 31, |
--------------------------------------- | --------------- | --------
                                        | 2019            | 2018
Deferred tax assets:                    |                 |
Net operating loss carryforwards        | $35,120         | $24,159
Share-based compensation                | 5,687           | 2,760
Deferred revenue                        | 1,761           | 2,237
Fixed assets                            | 4,187           | 3,593
Lease liability                         | 11,748          | 17,024
Accrued compensation                    | 1,211           | 742
Accrued costs                           | 401             | 1,362
Deferred rent                           | 320             | 473
Income tax credits                      | 1,833           | 1,151
Other                                   | 1,247           | 109
Gross deferred tax assets               | 63,515          | 53,610
Deferred tax liabilities:               |                 |
Prepaid expenses                        | (219)           | (315)
Fixed assets                            | (13,855)        | (19,280)
Unremitted earnings                     | (320)           | (115)
Intangible assets                       | (4,818)         | —
Capitalized commissions                 | (7,606)         | —
Other                                   | (387)           | —
Gross deferred tax liabilities          | (27,205)        | (19,710)
Valuation allowance                     | (38,318)        | (34,008)
Deferred tax (liabilities) assets, net  | $(2,008)        | $(108)

Deferred tax assets liabilities reflect tax effects operating loss carryovers temporary differences between financial reporting income tax. deferred tax assets
 deferred tax assets management considers factors taxable income future reversals differences tax planning strategies future taxable income projections deferred tax assets.
 negative evidence losses uncertainty realizing deferred tax assets full valuation allowance against deferred tax assets.
 $4. 3 million increase valuation allowance 2018 to 2019 due to operating losses windfall tax benefits equity awards offset reduction valuation allowance net deferred tax liability ASC 606. Company recognized tax benefit $1. 0 million for release pre-existing U. K. valuation allowances Ataata Simply Migrate business combinations.
 2018 Tax Cuts and Jobs Act) enacted. Securities and Exchange Commission guidance. taxpayers consider impact. legislation “provisional” necessary information change tax law.
2019 Company completed accounting tax effects enactment Act. recognized adjustment provisional estimate Act fiscal 2018 financial statements.
 2019. net operating loss carryforwards $57. 4 million. federal net operating loss carryforwards $78. 6 million. 2017 $32. 5 million expire 2037. 2017 $46. 1 million expire.
. state net operating loss carryforwards $54. 6 million expire through 2039. Australian net operating loss carryforwards $23. 9 million. German net operating loss carryforwards $9. 9 million.
 Israeli net operating loss carryforwards $3. 3 million. income tax credit carryforward $1. 1 million. Israeli income tax credit carryforwards $0. 6 million expires 2023 2024.
 Section 382. Internal Revenue Code ownership change pre-change net operating loss carryforwards offset post-change income taxes. ownership change occurs 50 percent change ownership three-year period. rules. state tax laws.
Company believes experienced ownership may transactions outside control. net operating loss carryforwards tax attributes. income limitations.
 March 31, 2019 2018 liabilities uncertain tax positions $6. million $6. 2 million tax rate.
 Deferred tax assets
 Net operating loss carryforwards $35,120 $24,159
 Share-based compensation 5,687
 Deferred revenue 1,761
 Fixed assets 4,187
 Lease liability 11,748
 Accrued compensation 1,211
 costs
 Deferred rent
 Income tax credits 1,833
 Gross deferred tax assets 63,515 53,610
 liabilities
 Prepaid expenses
 Fixed assets (13,855
 Unremitted earnings
 Intangible assets
 Capitalized commissions
 Gross deferred tax liabilities (27,205 (19
 Valuation allowance (38,318)
 $(2,008)


Cash and Cash Equivalents
Highly liquid instruments purchased with original maturities of three months or less are considered cash equivalents. Cash equivalents are invested with high credit quality financial institutions and consist of short-term investments, such as demand deposit accounts, money market accounts, money market funds and time deposits. The carrying amounts of these instruments reported in the Consolidated Balance Sheets approximate their fair value because of their immediate or short-term maturities.
Cash and cash equivalents are unrestricted and include the following (in millions):

                          | December 31, |
------------------------- | ------------ | -----
                          | 2019         | 2018
Cash                      | $8.2         | $9.5
Cash equivalents          | 7.2          | 10.8
Cash and cash equivalents | $15.4        | $20.3

Cash Equivalents
 liquid instruments maturities three months less cash equivalents. invested high credit institutions short investments. carrying amounts Consolidated Balance Sheets approximate fair value maturities.
 Cash equivalents unrestricted include
 December 31,
 2019 2018
 Cash $8. $9.
 Cash equivalents. 10.
 $15. $20.


Life Sciences Segment
Selling, general and administrative: Selling, general and administrative expenses from our Life Sciences segment for the year ended December 31, 2019 decreased $5.0 million to $8.6 million from $13.6 million for the year ended December 31, 2018. The decrease was driven by comparably fewer expenses at the Pansend holding company, which incurred additional compensation expense in the prior period related to the performance of the segment. The decrease was also due to a reduction in costs associated with the sale of BeneVir in the second quarter of 2018.

Life Sciences Segment               |       |                          |
----------------------------------- | ----- | ------------------------ | ---------------------
                                    |       | Years Ended December 31, |
                                    | 2019  | 2018                     | Increase / (Decrease)
Selling, general and administrative | $8.6  | $13.6                    | $(5.0)
Depreciation and amortization       | 0.3   | 0.2                      | 0.1
Loss from operations                | (8.9) | $(13.8)                  | $4.9

Life Sciences Segment
 Selling administrative expenses December 31, 2019 decreased $5. million to $8. 6 million $13. million 2018. decrease fewer expenses Pansend holding company additional compensation expense. due reduction costs sale BeneVir second quarter 2018.
 Life Sciences Segment
 Ended December 31,
 2019 Increase
 Selling general administrative $8. 6 $13.
 Depreciation amortization.
 Loss operations. $4.


Accounting for Uncertainty in Income Taxes
During fiscal 2019 and 2018, the aggregate changes in our total gross amount of unrecognized tax benefits are summarized as follows:
At September 30, 2019 and 2018, the amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was $0.7 million and $1.8 million, respectively. During fiscal year 2020, it is reasonably possible that resolution of reviews by taxing authorities, both domestic and foreign, could be reached with respect to an immaterial amount of net unrecognized tax benefits depending on the timing of examinations or expiration of statutes of limitations, either because our tax positions are sustained or because we agree to the disallowance and pay the related income tax. We recognize interest and/or penalties related to income tax matters in income tax expense. The amount of net interest and penalties recognized as a component of income tax expense during fiscal 2019 and 2018 were not material.
We are subject to ongoing audits from various taxing authorities in the jurisdictions in which we do business. As of September 30, 2019, the fiscal years open under the statute of limitations in significant jurisdictions include 2016 through 2019 in the U.S. We believe we have adequately provided for uncertain tax issues we have not yet resolved with federal, state and foreign tax authorities. Although not more likely than not, the most adverse resolution of these issues could result in additional charges to earnings in future periods. Based upon a consideration of all relevant facts and circumstances, we do not believe the ultimate resolution of uncertain tax issues for all open tax periods will have a material adverse effect upon our financial condition or results of operations.
Cash amounts paid for income taxes, net of refunds received, were $28.7 million, $15.7 million and $1.6 million in 2019, 2018 and 2017, respectively.

                                                              |         | September 30,
------------------------------------------------------------- | ------- | --------------
                                                              | 2019    | 2018
                                                              |         | (in thousands)
Balance at beginning of year                                  | $ 9,942 | $ 13,248
Additions (reductions) for tax positions taken in prior years | 8,458   | (80)
Recognition of benefits from expiration of statutes           | (776)   | (1,770)
Additions for tax positions related to the current year       | 951     | 713
Reductions for tax positions related to acquisitions          | —       | (2,169)
Balance at end of year                                        | $18,575 | $9,942

Accounting Uncertainty Income Taxes
 fiscal 2019 2018 changes unrecognized tax benefits
 September 30, 2019 2018 unrecognized tax benefits effective tax rate $0. 7 million $1. 8 million. fiscal year 2020 possible resolution reviews immaterial unrecognized tax benefits timing expiration statutes of limitations disallowance. recognize interest penalties income tax expense. net interest penalties 2019 2018 not material.
 subject to audits taxing jurisdictions. September 30, 2019 fiscal years limitations include 2016 through 2019. provided for uncertain tax issues. adverse resolution could additional charges earnings. ultimate resolution uncertain tax issues effect financial condition results operations.
 Cash amounts paid income taxes net refunds $28. 7 million, $15. 7 million $1. 6 million in 2019 2018 2017.
 September 30,
 2018
 Balance beginning year $ $ 13,248
 Additions (reductions) tax positions prior years 8,458 (80)
benefits expiration statutes (776) (1,770
 Additions 951 713
 Reductions (2,169)
 year $18,575 $9,942


Note 15. Stock-Based Compensation
The following table summarizes the components of non-cash stock-based compensation expense (in thousands):
2015 Equity Incentive Plan
We issue stock options pursuant to our 2015 Plan. The 2015 Plan allows for the grant of stock options to employees and for the grant of nonqualified stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, or RSUs, performance-based stock awards, and other forms of equity compensation to our employees, directors and non-employee directors and consultants.
In June 2015, our board of directors adopted and our stockholders approved our 2015 Plan pursuant to which we initially reserved a total of 4,700,000 shares of common stock for issuance under the 2015 Plan, which included shares of our common stock previously reserved for issuance under our Amended and Restated 2009 Stock Incentive Plan, or the 2009 Plan. The number of shares of common stock reserved for issuance under the 2015 Plan will automatically increase on January 1 each year, for a period of not more than ten years, commencing on January 1, 2016 through January 1, 2024, by 5% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares as may be determined by the board of directors. As a result of the adoption of the 2015 Plan, no further grants may be made under the 2009 Plan. As of December 31, 2019, 6,527,550 shares remained available for future grant under the 2015 Plan.
Stock Options
Stock options under the 2015 Plan have been granted at exercise prices based on the closing price of our common stock on the date of grant. Stock options under the 2009 Plan were granted at exercise prices as determined by the board of directors to be the fair market value of our common stock. Our stock options generally vest over a five-year period and each option, if not exercised or forfeited, expires on the tenth anniversary of the grant date.
Certain stock options granted under the 2015 Plan and previously granted under the 2009 Plan may be exercised before the options have vested. Unvested shares issued as a result of early exercise are subject to repurchase by us upon termination of employment or services at the original exercise price. The proceeds from the early exercise of stock options are initially recorded as a current liability and are reclassified to common stock and additional paid-in capital as the awards vest and our repurchase right lapses. There were 250 and 957 unvested shares of common stock outstanding subject to our right of repurchase as of December 31, 2019 and 2018, respectively. We repurchased 27 and 107 of these unvested shares of common stock related to early exercised stock options in connection with employee terminations during the years ended December 31, 2019 and 2018, respectively. We recorded less than $0.1 million in accounts payable, accrued expenses and other current liabilities on our consolidated balance sheets for the proceeds from the early exercise of the unvested stock options as of December 31, 2019 and 2018.
We account for stock-based compensation options based on the fair value of the award as of the grant date. We recognize stock-based compensation expense using the accelerated attribution method, net of actual forfeitures, in which compensation cost for each vesting tranche in an award is recognized ratably from the service inception date to the vesting date for that tranche.
We value our stock options using the Black-Scholes option pricing model, which requires the input of subjective assumptions, including the risk-free interest rate, expected term, expected stock price volatility and dividend yield. The risk-free interest rate assumption is based upon observed interest rates for constant maturity U.S. Treasury securities consistent with the expected term of our stock options. The expected term represents the period of time the stock options are expected to be outstanding and is based on the "simplified method." Under the "simplified method," the expected term of an option is presumed to be the mid-point between the vesting date and the end of the contractual term. We use the "simplified method" due to the lack of sufficient historical exercise data to provide a reasonable basis upon which to otherwise estimate the expected term of the stock options. Beginning in November 2019, the expected volatility for options granted is based on historical volatilities of our stock over the estimated expected term of the stock options. The expected volatility for options granted prior to November 2019 was based on historical volatilities of our stock and publicly traded stock of comparable companies over the estimated expected term of the stock options.
There were 186,500, 219,450 and 252,100 stock options granted during the years ended December 31, 2019, 2018 and 2017, respectively. We declared and paid dividends in June 2015 in anticipation of our IPO, which we closed on July 1, 2015. Subsequent to the IPO, we do not expect to declare or pay dividends on a recurring basis. As such, we assume that the dividend rate is 0%.

                                       |         | Year Ended December 31, |
-------------------------------------- | ------- | ----------------------- | -------
                                       | 2019    | 2018                    | 2017
Stock options and assumed options      | $3,783  | $3,511                  | $3,913
Restricted stock units                 | 16,627  | 9,770                   | 3,366
Restricted stock awards                | —       | 1                       | 19
Employee stock purchase plan           | 193     | 147                     | 115
Total stock-based compensation expense | $20,603 | $13,429                 | $7,413
Tax benefit from stock-based awards    | $5,154  | $7,581                  | $12,719

. Stock-Based Compensation
 table summarizes non-cash stock-based compensation expense
 2015 Equity Incentive Plan
 issue stock options 2015 Plan. allows stock options employees nonqualified stock options stock appreciation rights restricted stock awards performance-based stock awards equity compensation employees directors non directors consultants.
 June 2015, board directors adopted stockholders approved 2015 Plan reserved 4,700,000 shares common stock Amended 2009 Stock Incentive Plan. January 1 each year ten years through 2024 by 5% shares common stock outstanding December 31 year or. no further grants under 2009 Plan. December 31, 2019 6,527,550 shares available for future grant Plan.
 Stock Options
 granted at exercise prices based closing price common stock. 2009 Plan granted prices fair market value. vest over five-year period expires tenth anniversary grant date.
 stock options granted 2015 Plan 2009 Plan exercised before vested.Unvested shares issued early exercise repurchase termination employment original price. proceeds recorded current liability reclassified to common stock capital awards vest repurchase right lapses. 250 957 unvested shares outstanding repurchase December 31, 2019 2018. repurchased 27 107 employee terminations December 31, 2019 2018. recorded less than $0. 1 million accounts payable accrued expenses current liabilities balance sheets for proceeds exercise 2019.
 account for stock-based compensation options based fair value grant date. recognize compensation expense accelerated attribution method cost inception.
 value stock options Black-Scholes option pricing model subjective assumptions risk-free interest rate expected term stock price volatility dividend yield. risk-free interest rate based observed interest rates constant maturity U. S. Treasury securities expected term. expected term based "simplified method. mid-point between vesting date end contractual term. historical exercise data expected term.November 2019 volatility options historical stock. comparable companies.
 186,500 219,450 252,100 stock options granted December 31, 2019 2018 2017. declared paid dividends June 2015 IPO closed July 1, 2015. dividends. dividend rate 0%.
 Ended December 31,
 2019 2018 2017
 Stock options $3,783 $3,511 $3,913
 Restricted stock units 16,627 9,770 3,366
 stock awards
 Employee stock purchase plan 193
 stock-based compensation expense $20,603 $13,429 $7,413
 Tax benefit $5,154 $7,581 $12,719


American Tower Corporation • 2019 Annual Report
Appendix 1 • Letter to Stakeholders
RETURN ON INVESTED CAPITAL (ROIC) RECONCILIATION1 ($ in millions. Totals may not add due to rounding.)
1 Historical denominator balances reflect purchase accounting adjustments
2 Represents Q4 2015 annualized numbers to account for full year impact of Verizon Transaction.
3 Represents Q4 2016 annualized numbers to account for full year impact of Viom Transaction
4 Adjusted to annualize impacts of acquisitions closed throughout the year.
5 Positively impacted by the Company's settlement with Tata in Q4 2018.
6 Excludes the impact of deferred tax adjustments related to valuation.

                  | 2015 2  | 2016 3  | 2017 4  | 2018 4,5 | 2019 4
----------------- | ------- | ------- | ------- | -------- | -------
Adjusted EBITDA   | $3,206  | $3,743  | $4,149  | $4,725   | $4,917
Cash Taxes        | (107)   | (98)    | (137)   | (172)    | (168)
Maintenance Capex | (124)   | (159)   | (115)   | (150)    | (160)
Corporate Capex   | (26)    | (27)    | (17)    | (9)      | (11)
Numerator         | $2,948  | $3,459  | $3,880  | $4,394   | $4,579
Gross PPE         | $14,397 | $15,652 | $16,950 | $17,717  | $19,326
Gross Intangibles | 12,671  | 14,795  | 16,183  | 16,323   | 18,474
Gross Goodwill6   | 4,240   | 4,510   | 4,879   | 4,797    | 5,492
Denominator       | $31,308 | $34,957 | $38,012 | $38,837  | $43,292
ROIC              | 9.4%    | 9.9%    | 10.2%   | 11.3%    | 10.6%

Tower Corporation 2019 Annual Report
 Appendix 1 Letter Stakeholders
 RETURN INVESTED CAPITAL millions. add rounding.
 balances adjustments
 Q4 2015 Verizon Transaction.
 Q4 2016 Viom Transaction
 acquisitions.
 impacted settlement Tata Q4 2018.
 deferred tax adjustments.
 2016 2017 2019
 Adjusted EBITDA $3,206 $3,743  $4,149 $4,725 $4,917
 Cash Taxes
 Corporate Capex
 $2,948 $3,459 $3,880 $4,394 $4,579
 PPE $14,397 $15,652 $16,950 $17,717 $19,326
 Intangibles 12,671 14,795 16,183 18,474
 4,240 4,510
 $31,308 $34,957 $38,012 $38,837 $43,292
 ROIC 9. 4%. 2%. 3%. 6%


Foreign currency translation risk
Our reporting currency is the U.S. dollar. Fluctuations in foreign currencies impact the amount of total assets and liabilities that we report for our foreign subsidiaries upon the translation of these amounts into U.S. dollars. In particular, the amount of cash and cash equivalents that we report in U.S. dollars for a significant portion of the cash held by these subsidiaries is subject to translation variance caused by changes in foreign currency exchange rates as of the end of each respective reporting period (the offset to which is recorded to accumulated other comprehensive income on our Consolidated Balance Sheets).
The following table shows our cash and cash equivalents denominated in certain major foreign currencies as of June 30, 2019 (equivalent in U.S. dollar):
If overall foreign currency exchange rates in comparison to the U.S. dollar uniformly weakened by 10%, the amount of cash and cash equivalents we would report in equivalent U.S. dollars would decrease by approximately $32.9 million (June 30, 2018—$34.6 million), assuming we have not entered into any derivatives discussed above under "Foreign Currency Transaction Risk".

(In thousands)                                                    | U.S. Dollar Equivalent at June 30, 2019 | U.S. Dollar Equivalent at June 30, 2018
----------------------------------------------------------------- | --------------------------------------- | ---------------------------------------
Euro                                                              | $120,417                                | $120,346
British Pound                                                     | 33,703                                  | 31,211
Canadian Dollar                                                   | 12,635                                  | 24,590
Swiss Franc                                                       | 56,776                                  | 52,652
Other foreign currencies                                          | 105,273                                 | 117,459
Total cash and cash equivalents denominated in foreign currencies | 328,804                                 | 346,258
U.S. dollar                                                       | 612,205                                 | 336,684
Total cash and cash equivalents                                   | $941,009                                | $682,942

Foreign currency translation risk
 reporting currency U. dollar. Fluctuations currencies impact assets liabilities subsidiaries. dollars. cash equivalents. dollars subject translation variance currency exchange rates reporting period.
 table shows cash equivalents foreign currencies June 30, 2019.
 foreign currency exchange rates. 10% cash equivalents. dollars decrease $32. 9 million (June 30, 2018—$34. 6 derivatives Currency Transaction Risk.
. Dollar Equivalent June 30, 2019. 30 2018
 Euro $120,417,346
 British Pound 33,703
 Canadian Dollar 12,635 24
 Swiss Franc 56,776 52,652
 Other foreign currencies 105,273 117,459
 cash equivalents foreign currencies 328,804 346,258
. dollar 612,205 336,684
 cash equivalents $941,009 $682,942


Amounts recognised in the balance sheet are as follows:
The surplus of £2.2m (2018: £1.3m) has not been recognised as an asset as it is not deemed to be recoverable by the Group.

                                                       | 2019   | 2018
------------------------------------------------------ | ------ | ------
                                                       | £m     | £m
Present value of funded obligations                    | 20.0   | 19.7
Fair value of plan assets                              | (22.2) | (21.0)
Effect of surplus cap                                  | 2.2    | 1.3
Net asset recognised in the Consolidated balance sheet | –      | –

Amounts balance sheet
 surplus £2. 2m (2018 £1. 3m not recoverable.
 value funded obligations 20. 19. 7
 plan assets (22. (21.
 surplus cap 2. 1. 3
 Net asset Consolidated balance sheet


Inventory
Inventory is stated at the lower of cost and net realizable value, using the first-in, first-out (“FIFO”) valuation method. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Any adjustments to reduce the cost of inventories to their net realizable value are recognized in earnings in the current period.
Due to the low sell-through of our AirBar products, management has decided to fully reserve work-in-process for AirBar components, as well as AirBar related raw materials. Management has further decided to reserve for a portion of AirBar finished goods, depending on type of AirBar and in which location it is stored. The AirBar inventory reserve was $0.8 million and $1.0 million for the years ended December 31, 2019 and 2018, respectively.
In order to protect our manufacturing partners from losses in relation to AirBar production, we agreed to secure the value of the inventory with a bank guarantee. Since the sale of AirBars has been lower than expected, a major part of the inventory at the partner remained unused when the due date of the bank guarantee neared and Neonode therefore agreed that the partner should keep inventory for the production of 20,000 AirBars and the rest be purchased by us. The inventory value of these purchases has been fully reserved.
As of December 31, 2019, the Company’s inventory consists primarily of components that will be used in the manufacturing of our sensor modules. We segregate inventory for reporting purposes by raw materials, work-in-process, and finished goods.
Raw materials, work-in-process, and finished goods are as follows (in thousands):

                 | December 31, | December 31,
---------------- | ------------ | ------------
                 | 2019         | 2018
Raw materials    | $396         | $246
Work-in-process  | 186          | 220
Finished goods   | 448          | 753
Ending inventory | $1,030       | $1,219

Inventory
 stated lower cost net realizable value first-in, first-out (“FIFO”) valuation method. Net realizable value estimated selling prices less costs completion disposal transportation. adjustments cost recognized in earnings.
 low sell-through AirBar products work-in AirBar components raw materials. portion finished goods. AirBar inventory reserve $0. 8 million $1. 0 million years December 31, 2019 2018.
 protect partners losses value inventory bank guarantee. sale AirBars lower part inventory remained unused due date neared keep inventory AirBars rest purchased by us. inventory value fully reserved.
 December 31, 2019 inventory components manufacturing sensor modules. inventory by raw materials work-in-process finished goods.
 2019 2018
 Raw materials $396 $246
 Work-in-process 186 220
 Finished goods 448 753
 Ending inventory $1,030 $1,219


Short-Term Debt
The weighted-average interest rate for commercial paper at December 31, 2019 and 2018 was 1.6 percent and 2.5 percent, respectively. The weighted-average interest rates for short-term loans were 6.1 percent and 4.3 percent at December 31, 2019 and 2018, respectively.

($ in millions)                   |        |
--------------------------------- | ------ | -------
At December 31:                   | 2019   | 2018
Commercial paper                  | $  304 | $ 2,995
Short-term loans                  | 971    | 161
Long-term debt—current maturities | 7,522  | 7,051
Total                             | $8,797 | $10,207

Short
 interest commercial paper December 31, 2019 2018. 6 2. 5. loans 6. 1 4. 3 percent.
 millions
 Commercial paper $ 304 2,995
 Short-term loans 971
 Long-term maturities 7,522
 $8,797 $10,207


(1) Included in other long-term assets.
For certain other financial instruments, including accounts receivable, unbilled receivables, and accounts payable, the carrying value approximates fair value due to the relatively short maturity of these items.

                                            |         | December 31, 2018 |         |
------------------------------------------- | ------- | ----------------- | ------- | -------
(in thousands)                              | Level 1 | Level 2           | Level 3 | Total
Cash equivalents                            | $10,155 | $10,000           | -       | $20,155
Marketable securities:                      |         |                   |         |
Municipal bonds                             | $—      | $44,705           | —       | $44,705
Corporate bonds                             | —       | $48,296           | —       | $48,296
Total marketable securities                 | $—      | $93,001           | —       | $93,001
Investments in privately-held companies (1) | $—      | —                 | $3,390  | $3,390

Included long-term assets.
 financial instruments receivable unbilled payable carrying value approximates fair value short maturity.
 December 31, 2018
 thousands Level 1 2 3
 Cash equivalents $10,155 $10,000
 securities
 Municipal bonds $44,705
 Corporate bonds $48,296
 marketable securities $93,001
 Investments privately-held companies $3,390


The following table summarizes information regarding restricted shares/RSUs granted and vested (in thousands, except per restricted share/RSU amounts):
As of December 31, 2019, based on the probability of achieving the performance goals, there was $6.1 million of total unrecognized compensation cost, net of actual forfeitures, related to nonvested restricted shares/RSUs. Of the unrecognized compensation cost, 33% related to performance-based nonvested restricted shares/RSUs and 67% related to employment-based nonvested restricted shares/RSUs. This cost is expected to be recognized over a weighted average period of 2.0 years.

                                                                |        | Years Ended December 31, |
--------------------------------------------------------------- | ------ | ------------------------ | ------
                                                                | 2019   | 2018                     | 2017
Number of restricted shares/ RSUs granted                       | 508    | 492                      | 480
Weighted average grant-date fair value per restricted share/RSU | $28.43 | $28.16                   | $29.42
Fair value of restricted shares/RSUs vested                     | $3,647 | $8,342                   | $6,868

table summarizes restricted shares/RSUs granted vested
 December 31, 2019 performance goals $6. 1 million unrecognized compensation cost nonvested shares. 33% performance-based 67% employment-based. recognized over 2. years.
 Years Ended December 31,
 2019 2018 2017
 shares granted 508 492  480
 average grant-date fair value per share/RSU $28. 43. $29.
 vested $3,647 $8,342 $6,868


Minimising our environmental impact
During FY19 we have undertaken energy audits across all our UK manufacturing sites as part of our Energy Savings Opportunity Scheme (‘ESOS’) compliance programme, which is a mandatory energy assessment scheme for UK organisations. Our progress on energy efficiency improvements remains good, and we have delivered a further 4.9% improvement in our primary energy per tonne of product against last year, and 26.5% over the last six years.

Category      | Destination                          | FY19   |                 | FY18   |
------------- | ------------------------------------ | ------ | --------------- | ------ | ---------------
              |                                      | Tonnes | % of production | Tonnes | % of production
              | Redistribution for human consumption | 950    | 0.3%            | 791    | 0.2%
Waste avoided | Animal feed                          | 4,454  | 1.2%            | 4,895  | 1.3%
              | Total                                | 5,404  | 1.5%            | 5,686  | 1.5%
              | Co/Anaerobic digestion               | 24,978 | 6.6%            | 32,202 | 8.3%
Food waste    | Controlled combustion                | 1,650  | 0.4%            | 1,964  | 0.5%
              | Sewer                                | 8,280  | 2.2%            | 6,746  | 1.7%
              | Total                                | 34,908 | 9.2%            | 40,912 | 10.5%

environmental impact
 FY19 energy audits UK manufacturing sites Savings Opportunity Scheme mandatory. progress efficiency good 4. 9% improvement primary energy per tonne product last year 26. 5% six years.
 FY19
 Redistribution human consumption 950. 3% 791. 2%
 Waste avoided Animal feed 4,454. 2% 4,895.
 5,404. 5% 5,686.
 Co/Anaerobic digestion 24,978. 6% 32,202. 3%
 Food waste Controlled combustion 1,650. 4% 1,964. 5%
 8,280. 2%.
 34,908. 40,912.


26. Acquisitions and disposals
We completed a number of acquisitions and disposals during the year. The note below provides details of these transactions as well as those in the prior year. For further details see “Critical accounting judgements and key sources of estimation uncertainty” in note 1 “Basis of preparation” to the consolidated financial statements.
Accounting policies
Business combinations
Acquisitions of subsidiaries are accounted for using the acquisition method. The cost of the acquisition is measured at the aggregate of the fair values at the date of exchange of assets given, liabilities incurred or assumed and equity instruments issued by the Group. Acquisition-related costs are recognised in the income statement as incurred. The acquiree’s identifiable assets and liabilities are recognised at their fair values at the acquisition date. Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the Group’s previously held equity interest in the acquiree, if any, over the net amounts of identifiable assets acquired and liabilities assumed at the acquisition date. The interest of the non-controlling shareholders in the acquiree may initially be measured either at fair value or at the non-controlling shareholders’ proportion of the net fair value of the identifiable assets acquired, liabilities and contingent liabilities assumed. The choice of measurement basis is made on an acquisition-by-acquisition basis. Acquisitions of subsidiaries are accounted for using the acquisition method. The cost of the acquisition is measured at the aggregate of the fair values at the date of exchange of assets given, liabilities incurred or assumed and equity instruments issued by the Group. Acquisition-related costs are recognised in the income statement as incurred. The acquiree’s identifiable assets and liabilities are recognised at their fair values at the acquisition date. Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the Group’s previously held equity interest in the acquiree, if any, over the net amounts of identifiable assets acquired and liabilities assumed at the acquisition date. The interest of the non-controlling shareholders in the acquiree may initially be measured either at fair value or at the non-controlling shareholders’ proportion of the net fair value of the identifiable assets acquired, liabilities and contingent liabilities assumed. The choice of measurement basis is made on an acquisition-by-acquisition basis.
Acquisition of interests from non-controlling shareholders
In transactions with non-controlling parties that do not result in a change in control, the difference between the fair value of the consideration paid or received and the amount by which the non-controlling interest is adjusted is recognised in equity
The aggregate cash consideration in respect of purchases in subsidiaries, net of cash acquired, is as follows:
During the year ended 31 March 2019 the Group completed certain acquisitions for an aggregate net cash consideration of €87 million. The aggregate fair values of goodwill, identifiable assets, and liabilities of the acquired operations were €77 million, €123 million and €139 million respectively.

                                                | 2019 | 2018
----------------------------------------------- | ---- | ----
                                                | €m   | €m
Cash consideration paid                         |      |
Acquisitions during the year                    | 61   | 9
Net cash acquired and acquisition related costs | 26   | –
                                                | 87   | 9

. Acquisitions disposals
 completed acquisitions disposals year. note details transactions prior year. details see accounting judgements estimation uncertainty” note 1 consolidated financial statements.
 Accounting policies
 Business combinations
 Acquisitions subsidiaries accounted acquisition method. cost measured fair values assets liabilities equity instruments issued. costs recognised income statement. assets liabilities recognised fair values acquisition date. Goodwill measured excess consideration transferred non-controlling interests fair value previously equity interest net assets liabilities assumed. interest non-controlling shareholders measured fair value proportion net fair value assets. measurement acquisition-by-acquisition basis. Acquisitions subsidiaries accounted acquisition method. cost measured fair values exchange assets liabilities equity instruments issued. costs recognised income statement. assets liabilities recognised fair values acquisition date.Goodwill measured excess consideration transferred non-controlling interests acquiree fair value equity interest over assets acquired liabilities assumed acquisition date. interest non-controlling shareholders measured fair value or proportion net fair value assets acquired. measurement acquisition-by-acquisition.
 Acquisition interests from non-controlling shareholders
 transactions difference fair value non-controlling interest adjusted recognised in equity
 aggregate cash consideration purchases subsidiaries net acquired
 year 31 March 2019 Group completed acquisitions net cash €87 million. fair values goodwill assets liabilities €77 million €123 million €139 million.
 2018
 Cash consideration paid
 Acquisitions
 Net cash acquired acquisition related costs


4.2 Equity (continued)
Share buy-back
A buy-back is the purchase by a company of its existing shares. Refer to note 4.3 for further details.
Share-based payment reserve
This reserve records the value of shares under the Long Term Incentive Plan, and historical Employee and CEO Share Option plans offered to the CEO, Executives and employees as part of their remuneration. Refer to note 5.2 for further details of these plans.
Business combination reserve
The internal group restructure performed in the 2007 financial year, which interposed the holding company, iSelect Limited, into the consolidated group was exempted by AASB 3 Business Combinations as it precludes entities or businesses under common control. The carry-over basis method of accounting was used for the restructuring of the iSelect Group. As such, the assets and liabilities were reflected at their carrying amounts. No adjustments were made to reflect fair values, or recognise any new assets or liabilities. No goodwill was recognised as a result of the combination and any difference between the consideration paid and the ‘equity’ acquired was reflected within equity as an equity reserve titled “Business Combination Reserve”.
Foreign currency translation reserve
Refer to Note 1.5 for further details.

                                     | CONSOLIDATED |
------------------------------------ | ------------ | ----------
                                     | 2019 $’000   | 2018 $’000
Reserves                             |              |
Share-based payment reserve          | 3,960        | 3,198
Business combination reserve         | 5,571        | 5,571
Foreign currency translation reserve | (12)         | (24)
                                     | 9,519        | 8,745

. Equity
 Share buy-back
 purchase shares. note 4. 3.
 Share-based payment reserve
 records value shares Long Term Incentive Plan Employee CEO Share Option plans. note 5. 2.
 Business combination reserve
 group restructure 2007 iSelect Limited consolidated group exempted AASB 3 Business Combinations common control. carry-over accounting restructuring iSelect Group. assets liabilities reflected carrying amounts. No adjustments values new assets liabilities. goodwill difference consideration paid acquired reflected Combination.
 Foreign currency translation reserve
 Note 1. 5.
 CONSOLIDATED
 2018 Reserves
 Share-based payment reserve 3
 Business combination reserve 5,571
 Foreign currency translation reserve


We measure and report our annual scope 1 & 2 GHG emissions. As part of our commitment to reduce our Greenhouse Gas (‘GHG’) emissions, we moved to a certified green tariff renewable electricity supply contract for
our UK operations from the beginning of the financial year.
The GHG emissions summary below shows our gross emissions including location-based scope 2 emissions, as well as our net emissions accounting for the market-based scope 2 reporting for our certified green electricity tariff.
The reduction in emissions is driven by continued progress in energy efficiency, a reduction in emissions associated with refrigerants as we continue to move away from fluorinated gas refrigerants, and the general reduction in UK grid carbon factor as more renewables make up a greater proportion of the fuel mix.
Over the last six years, we have made good progress in our water consumption per tonne of product, reducing it by 15% over the period. There was also a significant improvement in FY19, and one of the contributing factors to the improvement was the closure of the Evercreech desserts facility which had a higher water intensity than most sites within the business.
* Our GHG emissions have been calculated using the GHG Protocol Corporate Accounting and Reporting Standard, and emissions factors from DEFRA’s UK government GHG conversion factors for company reporting (where factors have not been provided directly by a supplier). ** UK & Ireland only – comparable with FY19 Group structure. *** Full Group including US business.

Emissions are summarised below, all reported as CO2 equivalent (‘CO2e’) |         |                                    |
----------------------------------------------------------------------- | ------- | ---------------------------------- | -------
                                                                        |         | Emissions reported in tonnes CO2e* |
Emissions from:                                                         | FY19**  | FY18**                             | FY18***
Combustion of fuel and operation of facilities (Scope 1)                | 59,495  | 66,336                             | 75,600
Electricity, heat, steam and cooling purchased for own use (Scope 2)    | 27,633  | 32,389                             | 67,754
Total gross emissions (Scope 1 and 2)                                   | 87,128  | 98,725                             | 143,354
Green tariff                                                            | -27,603 | 0                                  | 0
Total net emissions (Scope 1 and 2)                                     | 59,525  | 98,725                             | 143,354
Ratio (KgCO2e per £1 sales revenue)                                     | 0.060   | 0.066                              | 0.056

measure report annual scope 1 2 GHG emissions. moved certified green tariff renewable electricity contract
 UK operations financial year.
 GHG emissions summary gross emissions scope 2 net emissions market 2 certified green electricity tariff.
 reduction driven energy efficiency reduction UK carbon factor renewables fuel mix.
 six years water consumption per tonne 15%. improvement FY19 closure Evercreech desserts facility higher water intensity.
 GHG emissions calculated GHG Protocol Corporate Accounting Reporting Standard UK government GHG conversion factors. UK Ireland comparable FY19 Group structure. Group US business.
 Emissions summarised reported CO2 equivalent
 Emissions tonnes CO2e
 FY19**
 Combustion fuel operation facilities (Scope 1) 59,495 66,336 75,600
 Electricity heat steam cooling use (Scope 2) 27,633 32,389 67,754
emissions 1 2) 87,128 98,725 143,354
 tariff -27,603
 net emissions 59,525 98,725 143,354
 £1 revenue.


GreenSky, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (United States Dollars in thousands, except per share data, unless otherwise stated)
Note 3. Fair Value of Assets and Liabilities
The following table summarizes, by level within the fair value hierarchy, the carrying amounts and estimated fair values of our assets and liabilities measured at fair value on a recurring or nonrecurring basis or disclosed, but not carried, at fair value in the Consolidated Balance Sheets as of the dates presented. There were no transfers into, out of, or between levels within the fair value hierarchy during any of the periods presented. Refer to Note 4, Note 7, Note 8, and Note 9 for additional information on these assets and liabilities.
(1) Disclosed, but not carried, at fair value.
(2) Measured at fair value on a nonrecurring basis.
(3) Measured and carried at fair value on a recurring basis.

                                       |       | December 31, 2019 |            | December 31, 2018 |
-------------------------------------- | ----- | ----------------- | ---------- | ----------------- | ----------
                                       | Level | Carrying Value    | Fair Value | Carrying Value    | Fair Value
Assets:                                |       |                   |            |                   |
Cash and cash equivalents(1)           | 1     | $195,760          | $195,760   | $303,390          | $303,390
Loan receivables held for sale, net(2) | 2     | 51,926            | 55,958     | 2,876             | 3,552
Servicing assets(3)                    | 3     | 30,459            | 30,459     | —                 | —
Liabilities:                           |       |                   |            |                   |
Finance charge reversal liability(3)   | 3     | $206,035          | $206,035   | $138,589          | $138,589
Term loan(1)                           | 2     | 384,497           | 392,201    | 386,822           | 386,234
Interest rate swap(3)                  | 2     | 2,763             | 2,763      | —                 | —
Servicing liabilities(3)               | 3     | 3,796             | 3,796      | 3,016             | 3,016

GreenSky Inc. NOTES CONSOLIDATED FINANCIAL STATEMENTS States Dollars thousands share data unless
 Note 3. Fair Value Assets Liabilities
 table summarizes level fair value carrying amounts estimated fair values assets liabilities measured recurring nonrecurring disclosed not carried Consolidated Balance Sheets. no transfers between levels fair value hierarchy. Note 4 7 8 9 additional information assets liabilities.
 Disclosed not carried.
 Measured nonrecurring.
 Measured carried recurring.
 December 31, 2019 December 31, 2018
 Carrying Value
 Assets
 Cash equivalents(1) $195,760 $303,390
 Loan receivables sale 51,926 2,876
 Servicing 30,459
 Liabilities
 Finance charge reversal $206,035 $138,589
 Term,497,201 386,822 386,234
Interest rate swap(3) 2 2,763
 Servicing liabilities(3) 3,796


The Company’s pension plan asset allocation at December 31, 2019 and at December 31, 2018 is as follows:
As of December 31, 2019, investments in funds were composed of commingled and multi-strategy funds invested in diversified portfolios of corporate bonds (37%), government bonds (32%), equity (15%) and other instruments (16%).
As of December 31, 2018, investments in funds were composed approximately for two thirds of commingled funds mainly invested in corporate bonds (55%) and treasury bonds and notes (45%) and for one third of multi-strategy funds invested in broadly diversified portfolios of
corporate and government bonds, equity and derivative instruments.

                                                         | Percentage of Plan Assets at December |
-------------------------------------------------------- | ------------------------------------- | ----
Asset Category                                           | 2019                                  | 2018
Cash and cash equivalents                                | 1%                                    | 2%
Equity securities                                        | 24%                                   | 27%
Government debt securities                               | 12%                                   | 3%
Corporate debt securities                                | 16%                                   | 26%
Investments in funds(a)                                  | 21%                                   | 17%
Real estate                                              | 2%                                    | 3%
Other (mainly insurance assets – contracts and reserves) | 24%                                   | 22%
Total                                                    | 100%                                  | 100%

pension plan asset allocation 2019 2018
 2019 corporate government bonds (32%) equity (15%) other instruments (16%).
 2018 two thirds corporate bonds (55% treasury bonds (45%) third multi funds
 bonds equity derivative instruments.
 Percentage Plan Assets
 Asset Category
 Cash equivalents 1%
 Equity securities 24%
 Government debt 12% 3%
 Corporate debt 16% 26%
 Investments funds 21% 17%
 Real estate 2%
 Other 24% 22%
 Total 100%


Amortization of Intangibles and Acquisition-Related Costs
Amortization of intangibles included in operating expense and acquisition-related costs during fiscal years 2019 , 2018 and 2017 were as follows (in thousands):
Amortization of intangible assets consists of amortization of acquired intangible assets, including customer relationships and trademarks and trade names. Acquisition-related costs include legal expense, due diligence costs, and other professional costs incurred for business acquisitions.
The increase in amortization of intangible assets from fiscal year 2018 to 2019 was primarily due to the Blue Microphones Acquisition and the ASTRO Acquisition. The increase in amortization of intangible assets from fiscal year 2018 to 2017 was primarily driven by the ASTRO Acquisition.

                                  |         | Years Ended March 31, |
--------------------------------- | ------- | --------------------- | ------
                                  | 2019    | 2018                  | 2017
Amortization of intangible assets | $12,594 | $7,518                | $4,352
Acquisition-related costs         | 1,696   | 1,412                 | 1,462
Total                             | $14,290 | $8,930                | $5,814

Amortization Intangibles Acquisition Costs
 acquisition costs 2019 2018 2017
 Amortization acquired relationships trademarks. costs legal due diligence professional costs acquisitions.
 increase 2018 2019 due Blue Microphones ASTRO Acquisition. 2018 2017 ASTRO Acquisition.
 Years Ended March 31,
 2018 2017
 Amortization assets $12,594 $7,518 $4,352
 Acquisition-related costs 1,696 1,412
 Total $14,290 $8,930 $5,814


Underlying effective tax rate
The underlying effective tax rate is calculated by dividing taxation excluding the tax impact of non-underlying items by profit before tax excluding the impact of non-underlying items and share of net profit/(loss) of joint ventures and associates. This measure reflects the underlying tax rate in relation to profit before tax excluding non-underlying items before tax and share of net profit/(loss) of joint ventures and associates.
Tax impact on non-underlying items within operating profit is the sum of the tax on each non-underlying item, based on the applicable country tax rates and tax treatment. This is shown in the table:
(a) Restated following adoption of IFRS 16. See note 1 and note 24 for further details.
(b) Refer to note 3 for further details on these items.
(c) Excludes €3 million (2018: €32 million) gain on disposal of spreads business by the joint venture in Portugal which is included in the share of net profit/(loss) of joint ventures and associates line. Including the gain, total non-underlying items not in operating profit but within net profit before tax is €35 million (2018: €154 million). See note 3.

                                                                                | € million | € million
---------------------------------------------------------------------------------------------------------------------------- | --------- | -------------
                                                                                | 2019      | 2018
                                                                                |           | (Restated)(a)
Taxation                                                                                | 2,263     | 2,572
Tax impact of:                                                                                |           |
Non-underlying items within operating profit(b)                                                                              | 309       | (259)
Non-underlying items not in operating profit  Taxation before tax impact of non-underlying                                   | (196)     | (29)
Taxation before tax impact of non-underlying                                                                                | 2,376     | 2,284
Profit before taxation                                                                                | 8,289     | 12,360
Non-underlying items within operating profit before tax(b)                                                                   | 1,239     | (3,176)
Non-underlying items not in operating profit but within net profit before tax(c)                                             | (32)      | (122)
Share of net (profit)/loss of joint ventures and associates                                                                  | (176)     | (185)
Profit before tax excluding non-underlying items before tax and share of net profit/ (loss) of joint ventures and associates | 9,320     | 8,877
Underlying effective tax rate                                                                                | 25.5%     | 25.7%

Underlying effective tax rate
 calculated by dividing taxation excluding non-underlying profit before net profit/ joint ventures. reflects underlying tax rate profit before tax net profit.
 Tax impact non-underlying items operating profit sum tax country tax rates treatment. shown table
 Restated following IFRS 16. See note 1 24 details.
 Refer note 3 details.
 Excludes €3 million (2018 €32 million gain on disposal spreads business joint venture Portugal included net profit/(loss. total non-underlying items not operating profit net profit before tax €35 million (2018 €154 million. note 3.
 Taxation 2,263 2,572
 Non-underlying items operating profit 309
 2,376
 8,289
 operating profit before tax 1,239 (3,176
 not net profit before tax
/loss joint ventures associates (176) (185)
 Profit before tax 9,320 8,877
 tax rate 25. 5%. 7%