entergy corporation subsidiaries notes financial statements entergy new orleans securitization bonds - hurricane isaac may 2015 city council issued financing order authorizing issuance securitization bonds to recover entergy new orleans 2019s hurricane isaac storm restoration costs $ 31. 8 million  including carrying costs costs funding replenishing storm recovery reserve $ 63. 9 million  approximately $ 3 million up-front financing costs associated securitization.
 july 2015  entergy new orleans storm recovery funding l. c. company wholly owned consolidated by entergy new orleans issued $ 98. 7 million storm cost recovery bonds.
 bonds have coupon 2. 67% ( 2. 67 % ) expected maturity date june 2024.
 principal amount not due until date given above entergy new orleans storm recovery funding expects make principal payments on bonds over next five years amounts $ 11. 4 million for 2016 , $ 10. 6 million for 2017 , $ 11 million for 2018 , $ 11. 2 million for 2019  $ 11. 6 million for 2020.
 proceeds  entergy new orleans storm recovery funding purchased from entergy new orleans storm recovery property  right to recover from customers through storm recovery charge amounts sufficient service securitization bonds.
 storm recovery property reflected as regulatory asset on consolidated entergy new orleans balance sheet.
 creditors of entergy new orleans do not have recourse to assets or revenues of entergy new orleans storm recovery funding including storm recovery property creditors entergy storm recovery funding not recourse assets revenues entergy new orleans.
 entergy new orleans has no payment obligations to entergy new orleans storm recovery funding except remit storm recovery charge collections.
entergy texas securitization bonds - hurricane rita april 2007 puct issued financing order authorizing issuance securitization bonds to recover $ 353 million entergy texas 2019s hurricane rita reconstruction costs up $ 6 million transaction costs offset by $ 32 million related deferred income tax benefits.
 june 2007  entergy gulf states reconstruction funding i , llc  company now wholly-owned consolidated by entergy texas  issued $ 329. 5 million senior secured transition bonds ( securitization bonds ) : amount ( in thousands ).
 principal amount each tranche not due until dates given above entergy gulf states reconstruction funding expects make principal payments on bonds over next five years amounts $ 26 million for 2016 , $ 27. 6 million for 2017 , $ 29. 2 million for 2018 , $ 30. 9 million for 2019  $ 32. 8 million for 2020.
 all scheduled principal payments for 2016 for tranche a-2 , $ 23. 6 million scheduled principal payments 2017 for tranche a-2 $ 4 million scheduled principal payments 2017 for tranche a-3.
 all scheduled principal payments for 2018-2020 for tranche a-3.
 proceeds entergy gulf states reconstruction funding purchased from entergy texas transition property  right to recover from customers through transition charge amounts sufficient to service securitization bonds.
 transition property reflected as regulatory asset on consolidated entergy texas balance sheet.
 creditors of entergy texas not have recourse to assets or revenues of entergy gulf states reconstruction funding  including transition property  creditors entergy gulf not recourse assets or revenues entergy texas.
 entergy texas has no payment obligations to entergy gulf states reconstruction funding except remit transition charge collections.

| amount ( in thousands )
------------------------------------------------- | -----------------------
senior secured transition bonds series a:         |
tranche a-1 ( 5.51% ( 5.51 % ) ) due october 2013 | $ 93500
tranche a-2 ( 5.79% ( 5.79 % ) ) due october 2018 | 121600
tranche a-3 ( 5.93% ( 5.93 % ) ) due june 2022    | 114400
total senior secured transition bonds             | $ 329500


performance graph graph compares return on lilly stock with standard & poor 2019s 500 stock index peer group for years 2014 through 2018.
 graph assumes on december 31 , 2013  person invested $ 100 each in lilly stock , s&p 500 stock index peer groups' common stock.
 graph measures total shareholder return  takes account stock price and dividends.
 assumes dividends paid by company are reinvested in company 2019s stock.
 value of $ 100 invested on last business day of 2013 comparison of five-year cumulative total return among lilly , s&p 500 stock index  peer group ( 1 ).
 1 constructed peer group as industry index for graph.
 comprises companies in pharmaceutical biotech industries used to benchmark compensation of executive officers for 2018 : abbvie inc. amgen inc. astrazeneca plc baxter international inc. biogen idec inc. bristol-myers squibb company celgene corporation ; gilead sciences inc. glaxosmithkline plc johnson & johnson ; medtronic plc ; merck & co. , inc. novartis ag. pfizer inc. roche holdings ag ; sanofi ; shire plc.

| lilly    | peer group | s&p 500
------ | -------- | ---------- | --------
dec-13 | $ 100.00 | $ 100.00   | $ 100.00
dec-14 | $ 139.75 | $ 114.39   | $ 113.69
dec-15 | $ 175.21 | $ 116.56   | $ 115.26
dec-16 | $ 157.03 | $ 112.80   | $ 129.05
dec-17 | $ 185.04 | $ 128.90   | $ 157.22
dec-18 | $ 259.88 | $ 136.56   | $ 150.33


purchases of equity securities table provides information about our repurchases of common stock registered pursuant to section 12 of securities exchange act of 1934 during quarter ended december 31 , 2014.
 period ( a ) number of shares purchased average price paid per share total number of shares purchased as part of publicly announced plans or programs ( b ) amount available for future share repurchases under plans or programs b ) ( in millions ).
 total 1269242 ( c ) $ 185. 23 1212228 $ 3671 we close books and records on last sunday of each month to align financial closing with business processes except for month of december fiscal year ends on december 31.
 fiscal months differ from calendar months.
 for september 29 , 2014 was first day of october 2014 fiscal month.
 in october 2010  board of directors approved share repurchase program authorized to repurchase common stock in privately negotiated transactions or in open market at prices per share not exceeding then-current market prices.
 on september 25 , 2014  board of directors authorized $ 2. 0 billion increase to program.
 management has discretion to determine dollar amount of shares to be repurchased and timing of repurchases in compliance with applicable law and regulation.
 may make purchases under program pursuant to rule 10b5-1 plans.
 program does not expiration date.
 during quarter ended december 31 , 2014  total number of shares purchased included 57014 shares transferred to us by employees in satisfaction of minimum tax withholding obligations associated with vesting of restricted stock units.
 these purchases were made separate authorization by board of directors not included within program.

period ( a )                           | total number of shares purchased | average price paid per share | total number of shares purchased as part of publicly announced plans or programs ( b ) | amount available for future share repurchases under the plans or programs ( b ) ( in millions )
-------------------------------------- | -------------------------------- | ---------------------------- | -------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------
september 29 2014 2013 october 26 2014 | 399259                           | $ 176.96                     | 397911                                                                                | $ 3825
october 27 2014 2013 november 30 2014  | 504300                           | $ 187.74                     | 456904                                                                                | $ 3739
december 1 2014 2013 december 31 2014  | 365683                           | $ 190.81                     | 357413                                                                                | $ 3671
total                                  | 1269242 ( c )                    | $ 185.23                     | 1212228                                                                                | $ 3671


marathon oil corporation notes consolidated financial statements $ 446 million present value of net minimum capital lease payments, $ 53 million related to obligations assumed by united states steel under financial matters agreement.
 operating lease rental expense was : ( in millions ) 2009 2008 2007 minimum rental ( a ) $ 238 $ 245 $ 209.
 ( a ) excludes $ 3 million , $ 5 million $ 8 million paid by united states steel in 2009 , 2008 2007 on assumed leases.
 26.
 commitments contingencies subject of party to pending or threatened legal actions  contingencies commitments involving variety of matters including laws regulations relating to environment.
 certain matters discussed below.
 ultimate resolution of contingencies could or be material to consolidated financial statements.
 management believes we will remain viable competitive enterprise possible contingencies could be resolved unfavorably.
 environmental matters 2013 subject to federal , state local foreign laws regulations relating to environment.
 laws provide for control of pollutants released environment require responsible parties undertake remediation of hazardous waste disposal sites.
 penalties may be imposed for noncompliance.
 at december 31 , 2009 and 2008 , accrued liabilities for remediation totaled $ 116 million and $ 111 million.
 not possible to estimate ultimate amount of all remediation costs incurred or penalties imposed.
 receivables for recoverable costs from certain states under programs to assist companies in clean-up efforts related to underground storage tanks at retail marketing outlets were $ 59 and $ 60 million at december 31 , 2009 and 2008.
 legal cases 2013 with other refining companies settled lawsuits pertaining to methyl tertiary-butyl ether ( 201cmtbe 201d ) in 2008.
we are a defendant  with other refining companies in 27 cases in four states alleging damages for mtbe contamination.
 like cases settled in 2008  12 of remaining cases consolidated in multi-district litigation ( 201cmdl 201d ) in southern district of new york for pretrial proceedings.
 other 15 cases in new york state courts ( nassau and suffolk counties ).
 plaintiffs in 26 of 27 cases allege damages to water supply wells from contamination of groundwater by mtbe similar to damages claimed in cases settled in 2008.
 in remaining case  new jersey department of environmental protection seeking cost of remediating mtbe contamination and natural resources damages from contamination groundwater mtbe.
 we vigorously defending these cases.
 engaged in settlement discussions to majority of cases.
 do not expect our share liability for cases to significantly impact our consolidated results of operations , financial position or cash flows.
 voluntarily discontinued producing mtbe in 2002.
 currently a party to one qui tam case  alleges marathon and other defendants violated false claims act with to reporting and payment of royalties on natural gas and natural gas liquids for federal and indian leases.
 qui tam action is in relator files suit on behalf of himself federal government.
 case currently pending is.
 harrold.
 wright.
 agip petroleum co.
.
 primarily a gas valuation case.
 marathon reached settlement with relator and doj finalized after indian tribes review and approve settlement terms.
 such settlement not expected to significantly impact our consolidated results of operations , financial position or cash flows.
 guarantees 2013 we provided certain guarantees  direct and indirect of indebtedness of other companies.
under terms of most guarantee arrangements, we required to perform should guaranteed party fail to fulfill obligations specified arrangements.
 in addition to financial guarantees we also have various performance guarantees related to specific agreements.

( in millions )      | 2009  | 2008  | 2007
-------------------- | ----- | ----- | -----
minimum rental ( a ) | $ 238 | $ 245 | $ 209
contingent rental    | 19    | 22    | 33
net rental expense   | $ 257 | $ 267 | $ 242


performance graph graph compares yearly change in cumulative total stockholder return for last five full fiscal years  based upon market price of our common stock , with cumulative total return on nasdaq composite index (. s.
 companies ) and peer group , nasdaq medical equipment-sic code 3840-3849 index , of medical equipment companies for period.
 performance graph assumes investment of $ 100 on march 31 , 2007 in our common stock , nasdaq composite index (.
 companies ) peer group index , and reinvestment of any all dividends.
 graph not 201csoliciting material 201d under regulation 14a or 14c of rules under securities exchange act of 1934  not deemed filed with securities and exchange commission not to be incorporated by reference in filings under securities act of 1933 , as amended , or exchange act made before or after date hereof irrespective of general incorporation language in filing.
 transfer agent american stock transfer & trust company , 59 maiden lane , new york , ny 10038  is our stock transfer agent.

| 3/31/2007 | 3/31/2008 | 3/31/2009 | 3/31/2010 | 3/31/2011 | 3/31/2012
------------------------------------------- | --------- | --------- | --------- | --------- | --------- | ---------
abiomed inc                                 | 100       | 96.19     | 35.87     | 75.55     | 106.37    | 162.45
nasdaq composite index                      | 100       | 94.11     | 63.12     | 99.02     | 114.84    | 127.66
nasdaq medical equipment sic code 3840-3849 | 100       | 82.91     | 41.56     | 77.93     | 94.54     | 74.40


customary affirmative and negative covenants events of default for unsecured financing arrangement  including limitations on consolidations  mergers sales of assets.
 financial covenants include maximum leverage ratio of 3. 0 to 1. 0 minimum interest coverage ratio of 3. 5 to 1. 0.
 if fall below investment grade credit rating  additional restrictions result  including restrictions on investments payment of dividends stock repurchases.
 in compliance with all covenants under senior credit facility as of december 31 , 2007.
 commitments under senior credit facility subject to certain fees including facility utilization fee.
 senior credit facility rated a- by standard & poor 2019s ratings services not rated by moody 2019s investors 2019 service , inc.
 available uncommitted credit facilities totaling $ 70. 4 million.
 management believes cash flows from operations with available borrowings under senior credit facility sufficient to meet expected working capital  capital expenditure debt service needs.
 should investment opportunities arise  believe earnings balance sheet cash flows will allow to obtain additional capital  if necessary.
 contractual obligations entered into contracts with third parties normal business require future payments.
 following table illustrates contractual obligations ( in millions ) : contractual obligations total 2008.
 total contractual obligations $ 591. 6 $ 58. 6 $ 156. 4 $ 203. 9 $ 172. 7 critical accounting estimates financial results affected by selection application of accounting policies methods.
 significant accounting policies require management 2019s judgment discussed below.
 excess inventory and instruments 2013 must determine as of each balance sheet date how much  if of inventory may prove to be unsaleable or unsaleable at carrying cost.
 must determine if instruments on hand will be put to productive use or remain undeployed result of excess supply.
reserves established to adjust inventory instruments to net realizable value.
 to determine appropriate level of reserves we evaluate current stock levels in relation to historical expected patterns of demand for all our products instrument systems components.
 basis for determination generally same for all inventory instrument items categories except for work-in-progress inventory , recorded at cost.
 obsolete or discontinued items generally destroyed completely written off.
 management evaluates need for changes to valuation reserves based on market conditions  competitive offerings other factors regular basis.
 income taxes we estimate income tax expense income tax liabilities assets by taxable jurisdiction.
 realization of deferred tax assets in each taxable jurisdiction dependent on our ability to generate future taxable income sufficient to realize benefits.
 evaluate deferred tax assets ongoing basis provide valuation allowances if determined to likely not deferred tax benefit not be realized.
 federal income taxes provided on portion of income of foreign subsidiaries expected to be remitted to u.
 operate within numerous taxing jurisdictions.
 subject to regulatory review or audit in all jurisdictions reviews audits may require extended periods of time to resolve.
 we make use of all available information make reasoned judgments regarding matters requiring interpretation in establishing tax expense liabilities reserves.
 believe adequate provisions exist for income taxes for all periods jurisdictions subject to review or audit.
 commitments contingencies 2013 accruals for product liability other claims established with internal external legal counsel based on current information historical settlement information for claims related fees for claims incurred but not reported.
 use actuarial model to assist management in determining appropriate level of accruals for product liability claims.
 historical patterns of claim loss development over time statistically analyzed to factors applied to loss estimates in actuarial model.
amounts established equate less than 5 percent total liabilities represent management 2019s best estimate of ultimate costs incur under various contingencies.
 goodwill intangible assets 2013 evaluate carrying value of goodwill indefinite life intangible assets annually or whenever events circumstances indicate carrying value may not recoverable.
 evaluate carrying value finite life intangible assets whenever events circumstances carrying value not recoverable.
 significant assumptions required to estimate fair value of goodwill intangible assets notably estimated future cash flows assets.
 fair valuation measurements use significant unobservable inputs defined under statement financial accounting standards no.
 157 , fair value measurements.
 changes to assumptions could require record impairment charges on assets.
 share-based payment 2013 account for share-based payment expense accordance with fair value z i m m e r h o l d i n g s , i n c.
 2 0 0 7 f o r m 1 0 - k a n n u a l r e p o r t

contractual obligations        | total   | 2008   | 2009 and 2010 | 2011 and 2012 | 2013 and thereafter
------------------------------ | ------- | ------ | ------------- | ------------- | -------------------
long-term debt                 | $ 104.3 | $ 2013 | $ 2013        | $ 104.3       | $ 2013
operating leases               | 134.3   | 35.4   | 50.0          | 28.6          | 20.3
purchase obligations           | 24.6    | 23.2   | 1.4           | 2013          | 2013
long-term income taxes payable | 137.0   | 2013   | 57.7          | 53.9          | 25.4
other long-term liabilities    | 191.4   | 2013   | 47.3          | 17.1          | 127.0
total contractual obligations  | $ 591.6 | $ 58.6 | $ 156.4       | $ 203.9       | $ 172.7


stock performance graph performance graph compares cumulative total return ( including dividends ) to holders of our common stock from december 31 , 2002 through december 31 , 2007  with cumulative total returns of nyse composite index , ftse nareit composite reit index ( 201call reit index 201d )  ftse nareit healthcare equity reit index ( 201chealthcare index 201d ) and russell 1000 index over same period.
 comparison assumes $ 100 invested on december 31 , 2002 in our common stock and in each foregoing indices and assumes reinvestment of dividends , as applicable.
 included nyse composite index in performance graph because our common stock is listed on nyse.
 included other indices because believe they most representative of industry in compete or provide fair basis for comparison with ventas  particularly relevant to assessment of our performance.
 figures in table below rounded to nearest dollar.
 ventas nyse composite index all reit index healthcare reit index russell 1000 index

| 12/31/2002 | 12/31/2003 | 12/31/2004 | 12/31/2005 | 12/31/2006 | 12/31/2007
--------------------- | ---------- | ---------- | ---------- | ---------- | ---------- | ----------
ventas                | $ 100      | $ 206      | $ 270      | $ 331      | $ 457      | $ 512
nyse composite index  | $ 100      | $ 132      | $ 151      | $ 166      | $ 200      | $ 217
all reit index        | $ 100      | $ 138      | $ 181      | $ 196      | $ 262      | $ 215
healthcare reit index | $ 100      | $ 154      | $ 186      | $ 189      | $ 273      | $ 279
russell 1000 index    | $ 100      | $ 130      | $ 145      | $ 154      | $ 178      | $ 188


4.
 stock options other stock plans 100962 options outstanding under 1993 stock option and retention stock plan of union pacific corporation 1993 plan ).
 7140 restricted shares outstanding under 1992 restricted stock plan for non-employee directors of union pacific corporation.
 no longer grant options or awards of retention shares and units under these plans.
 april 2000 shareholders approved union pacific corporation 2000 directors plan ) 1100000 shares of common stock reserved for issuance to non-employee directors.
 directors plan each non-employee director upon initial election to board of directors receives grant of 2000 shares of retention shares or retention stock units.
 prior to december 31 , 2007 each non-employee director received annually option to purchase at fair value number of shares of common stock not to exceed 10000 shares during any calendar year determined by dividing 60000 by 1/3 of fair market value of one share common stock on date board of directors meeting resulting quotient rounded to nearest 50 shares.
 as of december 31 , 2009  18000 restricted shares outstanding under directors plan 292000 options outstanding under directors plan.
 union pacific corporation 2001 stock incentive plan ( 2001 plan ) approved in april 2001.
 reserved 24000000 shares of common stock for issuance to eligible employees corporation subsidiaries in form of non-qualified options , incentive stock options  retention shares  stock units incentive bonus awards.
 non-employee directors not eligible for awards under 2001 plan.
 as of december 31 , 2009 3366230 options outstanding under 2001 plan.
 no longer grant stock options or other stock or unit awards under this plan.
 union pacific corporation 2004 stock incentive plan ( 2004 plan ) approved by shareholders in april 2004.
2004 plan reserved 42000000 shares common stock for issuance plus shares subject to awards under 2001 plan and 1993 plan outstanding on april 16 , 2004  available for regrant terms 2004 plan.
 under 2004 plan non- qualified options , stock appreciation rights  retention shares  stock units  incentive bonus awards may be granted to eligible employees corporation and subsidiaries.
 non-employee directors not eligible for awards under 2004 plan.
 as of december 31 , 2009 , 8939710 options and 3778997 retention shares and stock units outstanding under 2004 plan.
 33559150 ; 36961123 ; 38601728 shares of common stock authorized and available for grant at december 31, 2009 , 2008  2007 , respectively.
 stock options 2013 estimate fair value of stock option awards using black-scholes option pricing model.
 groups of employees and non-employee directors similar historical and expected exercise behavior considered separately for valuation purposes.
 table below shows annual weighted-average assumptions used for valuation purposes : weighted-average assumptions 2009 2008 2007.

weighted-average assumptions                              | 2009             | 2008             | 2007
--------------------------------------------------------- | ---------------- | ---------------- | ----------------
risk-free interest rate                                   | 1.9% ( 1.9 % )   | 2.8% ( 2.8 % )   | 4.9% ( 4.9 % )
dividend yield                                            | 2.3% ( 2.3 % )   | 1.4% ( 1.4 % )   | 1.4% ( 1.4 % )
expected life ( years )                                   | 5.1              | 5.3              | 4.7
volatility                                                | 31.3% ( 31.3 % ) | 22.2% ( 22.2 % ) | 20.9% ( 20.9 % )
weighted-average grant-date fair value of options granted | $ 11.33          | $ 13.35          | $ 11.19


item 7.
 management 2019s discussion analysis of financial condition results of operations executive summary international paper 2019s operating results in 2007 bene- fited from higher paper packaging price realizations.
 sales volumes slightly high- er  growth in overseas markets offset by lower volumes in north america balance production with customers 2019 demand.
 operationally our pulp paper containerboard mills ran well in 2007.
 input costs for wood , energy transportation costs above 2006 levels.
 in forest products business  earnings decreased 31% ( 31 % ) reflect- ing sharp decline in harvest income smaller drop in forestland real estate sales reflect- ing forestland divestitures in 2006.
 interest expense decreased over 40% ( 40 % ) principally due to lower debt balances interest rates from debt repayments refinancings.
 to first quarter of 2008  expect demand for north american printing papers packaging to remain steady.
 if economic downturn in 2008 greater than expected could have negative impact on sales volumes earnings.
 slight increases in paper packaging price realizations expected as implement announced price increases.
 first quarter earnings will reflect increased planned maintenance expenses continued escalation of wood , energy transportation costs.
 excluding impact of projected reduced earnings from land sales addition of equity earnings contributions from recent investment in ilim holding s.
 expect 2008 first-quarter earnings to be lower than in 2007 fourth quarter.
 results of operations industry segment operating profits used by inter- national paper 2019s management to measure earn- ings performance of businesses.
 management believes this measure allows better under- standing of trends in costs  operating efficiencies  prices volumes.
 industry segment operating profits defined as earnings before taxes minority interest , interest expense  corporate items corporate special items.
industry segment profits defined by securities exchange commission as non-gaap financial measure not gaap alternatives to net earn- ings or other operating measure accounting principles accepted in united states.
 international paper operates in six segments : print- ing papers industrial packaging consumer pack- aging distribution forest products specialty businesses other.
 table shows components of net earnings for last three years : in millions 2007 2006 2005.
 corporate special items include restructuring charg- es  net losses on sales impairments businesses gains on transformation plan forestland sales goodwill impairment charges insurance recoveries reversals of reserves required.
 industry segment operating profits of $ 2. 4 billion $ 349 million higher in 2007 than 2006 due to benefits from higher average price realizations ( $ 461 million ) cost reduction initiatives improved operating perform- ance favorable mix of products sold ( $ 304 million ) higher sales volumes ( $ 17 million ) lower special item costs ( $ 115 million ) other items ( $ 4 million ).
 benefits offset impacts of higher energy  raw material freight costs ( $ 205 million ) higher costs for planned mill maintenance outages ( $ 48 million ) lower earn- ings from land sales ( $ 101 million ) costs at pensacola mill with conversion machine to production linerboard ( $ 52 million ) reduced earnings due to net acquisitions divestitures ( $ 146 million ).
 segment operating profit ( in millions ) $ 2074 ( $ 205 ) ( $ 48 ) $ 17 ( $ 244 ) $ 2423$ 4 ( $ 52 ) ( $ 101 ) $ 461 $ 1000 $ 1500 $ 2000 $ 2500 $ 3000

in millions                        | 2007         | 2006           | 2005
---------------------------------- | ------------ | -------------- | ------------
industry segment operating profits | $ 2423       | $ 2074         | $ 1622
corporate items net                | -732 ( 732 ) | -746 ( 746 )   | -607 ( 607 )
corporate special items*           | 241          | 2373           | -134 ( 134 )
interest expense net               | -297 ( 297 ) | -521 ( 521 )   | -595 ( 595 )
minority interest                  | -5 ( 5 )     | -9 ( 9 )       | -9 ( 9 )
income tax benefit ( provision )   | -415 ( 415 ) | -1889 ( 1889 ) | 407
discontinued operations            | -47 ( 47 )   | -232 ( 232 )   | 416
net earnings                       | $ 1168       | $ 1050         | $ 1100


entergy corporation notes to consolidated financial statements consists of pollution control revenue bonds and environmental revenue bonds  secured by non-interest bearing first mortgage bonds.
 b bonds subject to mandatory tender for purchase from holders at 100% ( 100 % ) of principal amount outstanding on september 1 , 2005 can then be remarketed.
 c ) bonds subject to mandatory tender for purchase from holders at 100% ( 100 % ) of principal amount outstanding on september 1 , 2004 can then be remarketed.
 d bonds had mandatory tender date of october 1 , 2003.
 entergy louisiana purchased bonds from holders not remarketed bonds.
 entergy louisiana used cash on hand and short-term borrowing to buy-in bonds.
 e on june 1 , 2002  entergy louisiana remarketed $ 55 million st.
 parish pollution control revenue refunding bonds due 2030  resetting interest rate to 4. 9% ( 4. 9 % ) through may 2005.
 f bonds subject to mandatory tender for purchase from holders at 100% ( 100 % ) of principal amount outstanding on june 1 , 2005 can then be remarketed.
 g pursuant to nuclear waste policy act of 1982 entergy's nuclear owner/licensee subsidiaries have contracts with doe for spent nuclear fuel disposal service.
 contracts include one-time fee for generation prior to april 7 , 1983.
 entergy arkansas is only entergy company generated electric power with nuclear fuel prior to that date includes one-time fee  plus accrued interest  long-term fair value excludes lease obligations , long-term doe obligations  other long-term debt includes debt due within one year.
 determined using bid prices reported by dealer markets and nationally recognized investment banking firms.
annual long-term debt maturities ( excluding lease obligations ) for debt outstanding as of december 31 , 2003 for next five years are as follows:.
 in november 2000  entergy's non-utility nuclear business purchased fitzpatrick and indian point 3 power plants in seller-financed transaction.
 entergy issued notes to nypa with seven annual installments of approximately $ 108 million commencing one year from date closing and eight annual installments of $ 20 million commencing eight years from closing.
 these notes stated interest rate implicit interest rate of 4. 8% (. % ).
 accordance with purchase agreement with nypa purchase of indian point 2 resulted in entergy's non-utility nuclear business liable to nypa for additional $ 10 million per year for 10 years beginning in september 2003.
 liability recorded upon purchase of indian point 2 in september 2001 included in note payable to nypa balance above.
 in july 2003 payment of $ 102 million made prior to maturity on note payable to nypa.
 under provision in letter of credit supporting notes if domestic utility companies or system energy default on indebtedness entergy could be required to post collateral to support letter of credit.
 covenants in entergy corporation notes require to maintain consolidated debt ratio of 65% ( 65 % ) or less of total capitalization.
 if entergy's debt ratio exceeds this limit or if entergy or domestic utility companies default or in bankruptcy or insolvency proceedings acceleration of notes' maturity dates may occur.

| ( in thousands )
---- | ----------------
2004 | $ 503215
2005 | $ 462420
2006 | $ 75896
2007 | $ 624539
2008 | $ 941625


notes to consolidated financial statements union pacific corporation subsidiary companies for this report  unless context otherwise requires references to 201ccorporation 201d , 201ccompany 201d , 201cupc 201d  201cwe 201d  201cus 201d  201cour 201d mean union pacific corporation subsidiaries  including union pacific railroad company  separately referred to as 201cuprr 201d or 201crailroad 201d.
 1.
 nature of operations operations segmentation 2013 we are class i railroad operating in u. s.
 network includes 32122 route miles  linking pacific coast gulf coast ports with midwest eastern u. s.
 gateways providing several corridors to key mexican gateways.
 own 26042 miles operate on remainder to trackage rights or leases.
 serve western two-thirds of country maintain coordinated schedules with other rail carriers for handling of freight to from atlantic coast  pacific coast southeast southwest  canada  mexico.
 export and import traffic moved through gulf coast pacific coast ports across mexican canadian borders.
 railroad , along with subsidiaries rail affiliates is our one reportable operating segment.
 provide analyze revenue by commodity group treat financial results of railroad as one segment due to integrated nature of rail network.
 following table provides freight revenue by commodity group:.
 revenues principally derived from customers domiciled in u. s. , ultimate points of origination or destination for some products transport outside u. s.
 each commodity groups includes revenue from shipments to and from mexico.
 included in above table are freight revenues from our mexico business amounted to $ 2. 3 billion in 2017 , $ 2. 2 billion in 2016 , $ 2. 2 billion in 2015.
basis presentation 2013 consolidated financial statements presented in accordance with accounting principles accepted.
 codified in financial accounting standards board ( fasb ) accounting standards codification ( asc ).
.
 significant accounting policies principles of consolidation 2013 consolidated financial statements include accounts of union pacific corporation subsidiaries.
 investments in affiliated companies ( 20% 20 % ) to 50% ( 50 % ) owned ) accounted for using equity method accounting.
 intercompany transactions eliminated.
 no less than majority-owned investments require consolidation under variable interest entity requirements.
 cash and cash equivalents 2013 cash equivalents consist of investments with original maturities of three months or less.
 accounts receivable 2013 includes receivables reduced by allowance for doubtful accounts.
 allowance based upon historical losses credit worthiness customers current economic conditions.
 receivables not expected to be collected in one year associated allowances classified as other assets in consolidated statements of financial position.

millions                 | 2017    | 2016    | 2015
------------------------ | ------- | ------- | -------
agricultural products    | $ 3685  | $ 3625  | $ 3581
automotive               | 1998    | 2000    | 2154
chemicals                | 3596    | 3474    | 3543
coal                     | 2645    | 2440    | 3237
industrial products      | 4078    | 3348    | 3808
intermodal               | 3835    | 3714    | 4074
total freight revenues   | $ 19837 | $ 18601 | $ 20397
other revenues           | 1403    | 1340    | 1416
total operating revenues | $ 21240 | $ 19941 | $ 21813


deposits 2014deposits include escrow funds other deposits in trust.
 company includes cash deposits in other current assets.
 deferred compensation obligations 2014the company 2019s deferred compensation plans allow participants to defer cash compensation into notional investment accounts.
 company includes such plans in long-term liabilities.
 value of company 2019s deferred compensation obligations based on market value of participants 2019 notional investment accounts.
 notional investments primarily of mutual funds based on observable market prices.
 mark-to-market derivative asset and liability 2014the company utilizes fixed-to-floating interest-rate swaps as fair-value hedges to achieve targeted level variable-rate debt percentage of total debt.
 company employs derivative financial instruments in variable-to-fixed interest rate swaps forward starting interest rate swaps as economic hedges and cash flow hedges  to fix interest cost on existing forecasted debt.
 company uses calculation of future cash inflows estimated future outflows discounted to determine current fair value.
 additional inputs to present value calculation include contract terms  counterparty credit risk  interest rates market volatility.
 other investments 2014other investments represent money market funds for active employee benefits.
 company includes other investments in other current assets.
 note 18 : leases company entered into operating leases involving facilities and equipment.
 rental expenses under operating leases were $ 29 million , $ 24 million and $ 21 million for years ended december 31 , 2017 , 2016 2015 .
 operating leases for facilities expire over next 25 years operating leases for equipment over next 5 years.
 certain operating leases have renewal options from one to five years.
minimum annual future rental commitment under operating leases initial or remaining non-cancelable lease terms over next 5 years and thereafter are as follows:.
 company has agreements with public entities ( 201cpartners 201d ) to establish joint ventures , referred to as 201cpublic-private partnerships. 201d under public-private partnerships , company constructed utility plant , financed by company and partners constructed utility plant ( connected to company 2019s property ) , financed by partners.
 company agreed to transfer and convey some real and personal property to partners in exchange for equal principal amount of industrial development bonds ( 201cidbs 201d ), issued by partners under state industrial development bond and commercial development act.
 company leased back total facilities , including portions funded by both company and partners , under leases for period 40 years.
 leases related to portion of facilities funded by company have required payments from company to partners that approximate payments required by terms of idbs from partners to company ( as holder of idbs ).
 as ownership of portion of facilities constructed by the

| amount
---------- | ------
2018       | $ 15
2019       | 14
2020       | 12
2021       | 9
2022       | 8
thereafter | 65


rental and management operations new site revenue growth.
 during year ended december 31 , 2014 , we grew our portfolio of communications real estate through acquisition and construction of approximately 8450 sites.
 in majority of international markets acquisition or construction of new sites results in increased pass-through revenues ( ground rent or power and fuel costs ) and expenses.
 we continue to evaluate opportunities to acquire communications real estate portfolios domestically and internationally to determine meet our risk-adjusted hurdle rates and integrate them into existing portfolio.
 majority of sites acquired or constructed in 2014 were in brazil , india mexico ; in 2013 in brazil, colombia , costa rica , india , mexico south africa ; in 2012 in brazil , germany , india uganda.
 rental and management operations expenses.
 direct operating expenses incurred by domestic international rental management segments include direct site level expenses consist primarily of ground rent power and fuel costs  some may passed through to tenants property taxes , repairs maintenance.
 these segment direct operating expenses exclude all segment and corporate selling , general , administrative development expenses  aggregated into one line item entitled selling , general  administrative development expense in consolidated statements of operations.
 domestic and international rental and management segments 2019 selling , general  administrative development expenses do not significantly increase adding incremental tenants to legacy sites typically increase only modestly year-over-year.
 leasing additional space to new tenants on legacy sites provides significant incremental cash flow.
 we may  incur additional segment selling , general , administrative development expenses as we increase presence in geographic areas where recently launched operations or focused on expanding portfolio.
 profit margin growth positively impacted by addition of new tenants to legacy sites can be temporarily diluted by development activities.
network development services segment revenue growth.
 focus on growing rental management operations anticipate network development services revenue represent small percentage of total revenues.
 non-gaap financial measures in analysis of results operations are discussions regarding earnings before interest  taxes  depreciation  amortization accretion  adjusted ( 201cadjusted ebitda 201d )  funds from operations  defined by national association of real estate investment trusts ( 201cnareit ffo 201d ) adjusted funds from operations ( 201caffo 201d ).
 define adjusted ebitda as net income before income ( loss ) on discontinued operations net ; income ( loss ) on equity method investments ; income tax benefit provision ) other income ( expense ) ; gain ( loss ) on retirement of long-term obligations ; interest expense ; interest income other operating income expense ) depreciation  amortization accretion stock-based compensation expense.
 nareit ffo defined as net income before gains or losses from sale or disposal of real estate real estate related impairment charges  related depreciation  amortization accretion dividends declared on preferred stock including adjustments for unconsolidated affiliates noncontrolling interest.

new sites ( acquired or constructed ) | 2014 | 2013 | 2012
------------------------------------- | ---- | ---- | ----
domestic                              | 900  | 5260 | 960
international ( 1 )                   | 7550 | 7810 | 7850


entergy texas , inc.
 subsidiaries management 2019s financial discussion analysis results of operations net income 2016 compared to 2015 net income increased $ 37. 9 million due to lower operation maintenance expenses asset write-off of receivable with spindletop gas storage facility in 2015 higher net revenue.
 2015 compared to 2014 net income decreased $ 5. 2 million due to asset write-off receivable spindletop gas storage facility higher other operation maintenance expenses offset by higher net revenue lower effective tax rate.
 net revenue 2016 compared to 2015 net revenue consists of operating revenues net of : 1 fuel , fuel-related expenses  gas purchased for resale  2 ) purchased power expenses  3 ) other regulatory charges.
 analysis of change in net revenue comparing 2016 to 2015.
 amount ( in millions ).
 reserve equalization variance due to reduction in reserve equalization expense due to changes in entergy system generation mix compared to same period 2015 execution of new purchased power agreement entergy mississippi 2019s exit from system agreement  each in november 2015 entergy texas 2019s exit from system agreement in august 2016.
 see note 2 to financial statements for discussion of system agreement.
 purchased power capacity variance due to decreased expenses due to termination of purchased power agreements between entergy louisiana and entergy texas in august 2016 capacity cost changes for ongoing purchased power capacity contracts.
 transmission revenue variance due to increase in attachment o rates charged by miso to transmission customers settlement of attachment o rates previously billed to transmission customers by miso.

| amount ( in millions )
------------------------ | ----------------------
2015 net revenue         | $ 637.2
reserve equalization     | 14.3
purchased power capacity | 12.4
transmission revenue     | 7.0
retail electric price    | 5.4
net wholesale            | -27.8 ( 27.8 )
other                    | -4.3 ( 4.3 )
2016 net revenue         | $ 644.2


stock performance graph graph provides comparison of five year cumulative total stockholder returns of teleflex common stock , standard a0& poor 2019s ( s&p ) 500 stock index s&p 500 healthcare equipment & supply index.
 annual changes for five-year period based on assumption $ 100 invested in teleflex common stock each index on december a031 , 2012 all dividends reinvested.
 market performance.
 s&p 500 healthcare equipment & supply index 100 128 161 171 181 238

company / index                             | 2012 | 2013 | 2014 | 2015 | 2016 | 2017
------------------------------------------- | ---- | ---- | ---- | ---- | ---- | ----
teleflex incorporated                       | 100  | 134  | 166  | 192  | 237  | 368
s&p 500 index                               | 100  | 132  | 151  | 153  | 171  | 208
s&p 500 healthcare equipment & supply index | 100  | 128  | 161  | 171  | 181  | 238


n o t e s t o c o n s o l i d a t e d f i n a n c i a l s t a t e m e n t s continued ) ace limited subsidiaries table shows changes in company 2019s restricted stock for years ended december 31 , 2008  2007  2006 : number of restricted stock weighted average grant- date fair value.
 under provisions fas 123r  recognition of deferred compensation  contra-equity account representing unrecognized restricted stock expense reduced as expense recognized at date restricted stock granted no longer permitted.
 upon adoption of fas 123r  deferred compensation reflected in unearned stock grant compensation reclassified to additional paid-in capital in company 2019s consolidated balance sheet.
 restricted stock units company 2019s 2004 ltip provides for grants other awards including restricted stock units.
 company generally grants restricted stock units with 4-year vesting period graded vesting schedule.
 each restricted stock unit repre- sents company 2019s obligation to deliver to holder one share of common shares upon vesting.
 during 2008 , company awarded 223588 restricted stock units to officers company subsidiaries weighted-average grant date fair value of $ 59. 93.
 2007 , 108870 restricted stock units  weighted-average grant date fair value of $ 56. 29 awarded to officers company subsidiaries.
 2006 , 83370 restricted stock units  weighted-average grant date fair value of $ 56. 36 awarded to officers company subsidiaries.
 company also grants restricted stock units with 1-year vesting period to non-management directors.
delivery of common shares on restricted stock units to non-management directors deferred until six months after date non-management directors 2019 termination from board.
 during 2008 , 2007  and 2006 , 40362 restricted stock units , 29676 restricted and 23092 restricted stock units , awarded to non-management direc- espp gives participating employees right to purchase common shares through payroll deductions during consecutive 201csubscription periods. 201d annual purchases by participants limited to number of whole shares purchased by amount equal to ten percent of participant 2019s compensation or $ 25000 , whichever is less.
 espp has two six-month subscription periods , first runs between january 1 and june 30 and second runs between july 1 and december 31 of each year.
 amounts collected from participants during subscription period used on 201cexercise date 201d to purchase full shares of common shares.
 exercise date is generally last trading day of sub- scription period.
 number of shares purchased is equal to total amount  of exercise date  collected from participants through payroll deductions for subscription period , divided by 201cpurchase price 201d , rounded down to next full share.
 effective for from second subscription period of 2007 , purchase price is 85 percent of fair value of common share on exercise date.
 prior to second subscription period of 2007 , purchase price was calculated as lower of ( i ) 85 percent of fair value of common share on first day of subscription period

| number of restricted stock | weighted average grant- date fair value
------------------------------------------ | -------------------------- | ---------------------------------------
unvested restricted stock december 31 2005 | 3488668                    | $ 41.26
granted                                    | 1632504                    | $ 56.05
vested and issued                          | -1181249 ( 1181249 )       | $ 40.20
forfeited                                  | -360734 ( 360734 )         | $ 44.04
unvested restricted stock december 31 2006 | 3579189                    | $ 48.07
granted                                    | 1818716                    | $ 56.45
vested and issued                          | -1345412 ( 1345412 )       | $ 44.48
forfeited                                  | -230786 ( 230786 )         | $ 51.57
unvested restricted stock december 31 2007 | 3821707                    | $ 53.12
granted                                    | 1836532                    | $ 59.84
vested and issued                          | -1403826 ( 1403826 )       | $ 50.96
forfeited                                  | -371183 ( 371183 )         | $ 53.75
unvested restricted stock december 31 2008 | 3883230                    | $ 57.01


second largest closed-end fund manager top- ten manager by aum 2013 net flows of long-term open-end mutual funds1.
 2013 leading manager by net flows for long-dated fixed income mutual funds1.
 2022 integrated legacy retail and ishares retail distribution teams unified client-facing presence.
 retail clients use blackrock 2019s capabilities combination 2014 active alternative passive 2014 strategic priority for blackrock to deliver capabilities through one integrated team.
 2022 international retail long-term net inflows of $ 17. 5 billion  15% ( 15 % ) organic growth positive across major regions diversified across asset classes.
 equity net inflows of $ 6. 4 billion driven by strong demand for top-performing european equities franchise investor risk appetite sector improved.
 multi-asset class fixed income products each generated net inflows of $ 4. 8 billion  investors manage duration volatility portfolios.
 2013 ranked as third largest cross border fund provider2.
 in united kingdom ranked among five largest fund managers2.
 ishares.
 alternatives ) 24337 ( 3053 ) 1645 ( 6837 ) 16092 total ishares $ 752706 $ 63971 $ 15960 $ 81735 $ 914372 amounts represent $ 16. 0 billion of aum acquired in credit suisse etf acquisition in july 2013.
 amounts include commodity ishares.
 leading etf provider world with $ 914. 4 billion of aum at december 31 , 2013 top asset gatherer globally in 20133 with $ 64. 0 billion of net inflows organic growth rate of 8% ( 8 % ).
 equity net inflows of $ 74. 1 billion driven by flows into funds with broad developed market exposures partially offset by outflows from emerging markets products.
ishares fixed income experienced net outflows $ 7. 5 billion  as low interest rate environment led liquidity-oriented investors to sell long-duration assets majority of ishares fixed income suite.
 in 2013  launched several funds to meet demand from clients seeking protection in rising interest rate environment offering expanded product set includes four new.
 funds including short-duration versions flagship high yield and investment grade credit products short maturity and liquidity income funds.
 ishares alternatives had $ 3. 1 billion net outflows predominantly out of commodities.
 ishares represented 23% ( 23 % ) of long-term aum at december 31, 2013 35% ( 35 % ) of long-term base fees for ishares offers most diverse product set in industry with 703 etfs at year-end 2013 serves broadest client base covering 25 countries on five continents.
 during 2013  ishares continued commitment to innovation responsible product structuring introducing 42 new etfs  acquiring credit suisse 2019s 58 etfs in europe entering new strategic alliance with fidelity investments deliver fidelity 2019s more than 10 million clients increased access to ishares products  tools support.
 alliance with fidelity investments successful full first year for core series expanded presence and offerings among buy-and-hold investors.
 broad product range offers investors precise transparent low-cost way to tap market returns gain access to full range of asset classes and global markets difficult or expensive for access liquidity required to make adjustments to exposures quickly cost-efficiently.
 2022.
 ishares aum ended at $ 655. 6 billion with $ 41. 4 billion net inflows driven by strong demand for developed markets equities and short-duration fixed income.
fourth quarter of 2012  debuted core series in united states designed provide essential building blocks for buy-and-hold investors constructing core portfolio.
 core series demonstrated solid results in first full year raising $ 20. 0 billion net inflows primarily in u. s.
 equities.
 united states ishares maintained position largest etf provider with 39% ( 39 % ) share of aum3.
 2022 international ishares aum ended at $ 258. 8 billion with robust net new business of $ 22. 6 billion led by demand for european and japanese equities diverse range of fixed income products.
 year-end 2013 ishares largest european etf provider with 48% ( 48 % ) of aum3.
 1 simfund 2 lipper feri 3 blackrock ; bloomberg

( in millions )    | component changes in aum 2014 ishares 12/31/2012 | component changes in aum 2014 ishares net new business | component changes in aum 2014 ishares acquisition ( 1 ) | component changes in aum 2014 ishares market / fx | component changes in aum 2014 ishares 12/31/2013
------------------ | ------------------------------------------------ | ------------------------------------------------------ | ------------------------------------------------------- | ------------------------------------------------- | ------------------------------------------------
equity             | $ 534648                                         | $ 74119                                                | $ 13021                                                 | $ 96347                                           | $ 718135
fixed income       | 192852                                           | -7450 ( 7450 )                                         | 1294                                                    | -7861 ( 7861 )                                    | 178835
multi-asset class  | 869                                              | 355                                                    | 2014                                                    | 86                                                | 1310
alternatives ( 2 ) | 24337                                            | -3053 ( 3053 )                                         | 1645                                                    | -6837 ( 6837 )                                    | 16092
total ishares      | $ 752706                                         | $ 63971                                                | $ 15960                                                 | $ 81735                                           | $ 914372


table represents unrealized losses related to derivative amounts in 201caccumulated other comprehensive loss 201d for years ended december 31 , ( in thousands ) : balance in accumulated other comprehensive loss.
 note 9 2013 fair value measurements company uses fair value hierarchy  prioritizes inputs measure fair value of financial instruments.
 hierarchy gives highest priority to unadjusted quoted prices in active markets for identical assets or liabilities ( level 1 measurement ) lowest priority to unobservable inputs ( level 3 ).
 three levels of fair value hierarchy set below : 2022 level 1 2013 quoted prices are available in active markets for identical assets or liabilities as of reporting date.
 active markets are those in which transactions for asset liability occur in sufficient frequency and volume to provide pricing information ongoing basis.
 2022 level 2 2013 pricing inputs are other than quoted prices in active markets included in level 1 directly or indirectly observable as of reporting date.
 level 2 includes financial instruments valued using models or other valuation methodologies.
 models are primarily industry-standard models consider assumptions including time value  volatility factors current market and contractual prices for underlying instruments other relevant economic measures.
 all assumptions are observable in marketplace throughout full term instrument derived from observable data or supported by observable levels at transactions executed in marketplace.
 2022 level 3 2013 pricing inputs include significant inputs less observable from objective sources.
 inputs may be used with internally developed methodologies result in management 2019s best estimate of fair value from perspective market participant.
 fair value of interest rate swap transactions based on discounted net present value of swap using third party quotes ( level 2 ).
changes in fair market value recorded in comprehensive income ( loss ) changes from ineffectiveness recorded in current earnings.
 assets and liabilities measured at fair value based on of three valuation techniques.
 three valuation techniques identified in table below : a ) market approach 2013 prices relevant information by market transactions involving identical comparable assets or liabilities b ) cost approach 2013 amount required to replace service capacity of asset ( replacement cost ) c ) income approach 2013 techniques to convert future amounts to single present amount based on market expectations ( including present value techniques  option-pricing excess earnings models )

contract type       | balance in accumulated other comprehensive loss 2009 | balance in accumulated other comprehensive loss 2008
------------------- | ---------------------------------------------------- | ----------------------------------------------------
interest rate swaps | $ 13053                                              | $ 18874


management 2019s discussion analysis of financial condition results of operations continued ) table presents average u. s.
 non-u. s.
 short-duration advances for years ended december 31 december 31.
 average short-duration advances for year ended december 31 , 2013 increased compared to year december 31 2012, average advances remained low relative to historical levels result of clients hold higher levels liquidity.
 average other interest-earning assets increased to $ 11. 16 billion for year ended december 31 , 2013 from $ 7. 38 billion for year december 31  2012.
 increased levels result of higher cash collateral participation in principal securities finance transactions.
 aggregate average interest-bearing deposits increased to $ 109. 25 billion for year ended december 31 , 2013 from $ 98. 39 billion for december 31 2012.
 increase due to higher levels of non-u. s.
 transaction accounts associated with growth of new existing business assets under custody administration.
 future transaction account levels influenced by underlying asset servicing business market conditions including general levels of u. s.
 non-u. s.
 interest rates.
 average other short-term borrowings declined to $ 3. 79 billion for year ended december 31, 2013 from $ 4. 68 billion for december 31 2012 higher levels client deposits provided additional liquidity.
 average long-term debt increased to $ 8. 42 billion for year ended december 31 , 2013 from $ 7. 01 billion for december 31 2012.
 increase reflected issuance of $ 1. 0 billion of extendible notes by state street bank in december 2012 issuance of $ 1. 5 billion of senior and subordinated debt in may 2013  issuance of $ 1. 0 billion of senior debt in november 2013.
 increase partly offset by maturities of $ 1. 75 billion of senior debt in second quarter of 2012.
average interest-bearing liabilities increased to $ 6. 46 billion for year ended december 31 , 2013 from $ 5. 90 billion for year ended december 31 , 2012 , primarily result of higher cash collateral received from clients in with participation in principal securities finance transactions.
 several factors could affect future our net interest revenue and margin , including mix of client liabilities ; actions of central banks ; changes in.
 and non-u.
 interest rates ; changes in yield curves ; revised proposed regulatory capital or liquidity standards interpretations ; discount accretion generated by former conduit securities in our investment securities portfolio ; yields earned on securities purchased compared to yields on securities sold or matured.
 based on market conditions and other factors , we continue to reinvest majority of proceeds from pay- downs and maturities of investment securities in highly-rated securities ,.
 treasury and agency securities , federal agency mortgage-backed securities and u. s.
 non-u. s.
 mortgage- and asset-backed securities.
 pace we to reinvest and types of investment securities purchased will depend on impact of market conditions and other factors over time.
 expect these factors and levels global interest rates to dictate effect our reinvestment program on future net interest revenue and net interest margin.

( in millions )                           | 2013   | 2012   | 2011
----------------------------------------- | ------ | ------ | ------
average u.s . short-duration advances     | $ 2356 | $ 1972 | $ 1994
average non-u.s . short-duration advances | 1393   | 1393   | 1585
average total short-duration advances     | $ 3749 | $ 3365 | $ 3579


goldman sachs group , inc.
 subsidiaries management 2019s discussion analysis net revenues table below presents our net revenues by line item in consolidated statements of earnings.
 table 2030 investment banking consists of revenues ( excluding net interest ) from financial advisory underwriting assignments derivative transactions related to these assignments.
 these activities included in our investment banking segment.
 2030 investment management of revenues ( excluding net interest ) from providing investment management services to diverse clients wealth advisory services certain transaction services to high-net-worth individuals and families.
 activities included in investment management segment.
 2030 commissions and fees revenues from executing and clearing client transactions on major stock  options futures exchanges worldwide over-the-counter ( otc ) transactions.
 activities included in institutional client services and investment management segments.
 2030 market making revenues ( excluding net interest ) from client execution activities related to making markets in interest rate products  credit products mortgages currencies  commodities equity products.
 activities included in institutional client services segment.
 2030 other principal transactions of revenues ( excluding net interest ) from investing activities origination of loans to provide financing to clients.
 other principal transactions includes revenues related to consolidated investments.
 activities included in investing & lending segment.
 operating environment.
 during 2017  higher asset prices tighter credit spreads supportive of industry-wide underwriting activities  investment management performance other principal transactions.
 low levels of volatility in equity , fixed income  currency commodity markets continued to negatively affect market-making activities particularly in fixed income  currency commodity products.
 price of natural gas decreased significantly during 2017  price of oil increased compared with end of 2016.
if trend of low volatility continues long term market-making activity levels remain low or investment banking activity levels asset prices assets under supervision decline net revenues likely negatively impacted.
 see 201csegment operating results 201d below for further information about operating environment material trends uncertainties impact results operations.
 first half of 2016 included challenging trends in operating environment for business activities including concerns uncertainties about global economic growth central bank activity political uncertainty economic implications surrounding potential exit of u. k.
 from e. u.
 second half of 2016 operating environment improved global equity markets increased investment grade high-yield credit spreads tightened.
 trends provided favorable backdrop for business activities.
 2017 versus 2016 net revenues in consolidated statements earnings were $ 32. 07 billion for 2017 , 5% ( 5 % ) higher than 2016  due to higher other principal transactions revenues  higher investment banking revenues  investment management revenues net interest income.
 increases partially offset by lower market making revenues lower commissions and fees.
 non-interest revenues.
 investment banking revenues consolidated statements earnings were $ 7. 37 billion for 2017 , 18% ( 18 % ) higher than 2016.
 revenues in financial advisory higher compared with 2016  reflecting increase in completed mergers and acquisitions transactions.
 revenues in underwriting significantly higher compared with 2016  due to higher revenues in debt underwriting  increase industry-wide leveraged finance activity equity underwriting  increase in industry-wide secondary offerings.
 52 goldman sachs 2017 form 10-k

$ in millions                | year ended december 2017 | year ended december 2016 | year ended december 2015
---------------------------- | ------------------------ | ------------------------ | ------------------------
investment banking           | $ 7371                   | $ 6273                   | $ 7027
investment management        | 5803                     | 5407                     | 5868
commissions and fees         | 3051                     | 3208                     | 3320
market making                | 7660                     | 9933                     | 9523
other principal transactions | 5256                     | 3200                     | 5018
totalnon-interestrevenues    | 29141                    | 28021                    | 30756
interest income              | 13113                    | 9691                     | 8452
interest expense             | 10181                    | 7104                     | 5388
net interest income          | 2932                     | 2587                     | 3064
total net revenues           | $ 32073                  | $ 30608                  | $ 33820


warfighter information network-tactical ( win-t ) ; command , control , battle management and communications ( c2bmc ) ; twic ).
 offsetting decreases were higher net sales of $ 140 million from qtc  acquired early in fourth quarter 2011 ; $ 65 million from increased activity on other programs  primarily federal cyber security programs ptds operational support.
 is&gs 2019 operating profit for 2012 decreased $ 66 million  or 8% ( 8 % ) compared to 2011.
 decrease attributable to lower operating profit of $ 50 million due to odin contract completion in 2011 ; $ 25 million due to increase in reserves for performance issues international airborne surveillance system 2012 $ 20 million due to lower volume on programs ( primarily c2bmc and win-t ).
 partially offsetting decreases was increase in operating profit due to higher risk retirements of $ 15 million from twic program $ 10 million due to increased activity on other programs  primarily federal cyber security programs ptds operational support.
 operating profit for jtrs program comparable decrease in volume offset by decrease in reserves.
 adjustments not related to volume  including net profit booking rate adjustments other matters $ 20 million higher for 2012 compared to 2011.
 backlog backlog decreased in 2013 2012 due to lower orders on programs ( eram ngi ) higher sales on certain programs ( national science foundation antarctic support disa gsm-o ) declining activities on smaller programs due to downturn in federal information technology budgets.
 backlog decreased in 2012 compared to 2011 due to substantial completion of various programs in 2011 ( primarily odin , u. k.
 census  jtrs ).
 expect is&gs 2019 net sales to decline in 2014 high single digit percentage range compared to 2013 due to continued downturn in federal information technology budgets.
operating profit expected to decline in 2014 high single digit percentage range consistent with expected decline net sales margins comparable with 2013 results.
 missiles fire control mfc business segment provides air missile defense systems ; tactical missiles air-to-ground precision strike weapon systems ; logistics technical services ; fire control systems mission operations support  readiness  engineering support  integration services manned unmanned ground vehicles.
 mfc 2019s major programs include pac-3  thaad  multiple launch rocket system  hellfire  joint air-to-surface standoff missile ( jassm ) javelin  apache fire control system sniper ae  low altitude navigation targeting infrared for night ( lantirn ae )  sof clss.
 mfc 2019s operating results included ( in millions ) :.
 2013 compared to 2012 mfc 2019s net sales for 2013 increased $ 300 million  or 4% ( 4 % )  compared to 2012.
 increase attributable to higher net sales of approximately $ 450 million for air missile defense programs ( thaad pac-3 ) due to increased production volume deliveries ; $ 70 million for fire control programs due net increased deliveries volume approximately $ 55 million for tactical missile programs due to net increased deliveries.
 increases partially offset by lower net sales of $ 275 million for technical services programs due to lower volume defense budget reductions competitive pressures.
 increase for fire control programs attributable to increased deliveries on sniper ae lantirn ae programs increased volume on sof clss program offset by lower volume on longbow fire control radar other programs.
 increase for tactical missile programs attributable to increased deliveries on jassm other programs offset by fewer deliveries on guided multiple launch rocket system javelin programs.

| 2013             | 2012             | 2011
------------------- | ---------------- | ---------------- | ----------------
net sales           | $ 7757           | $ 7457           | $ 7463
operating profit    | 1431             | 1256             | 1069
operating margins   | 18.4% ( 18.4 % ) | 16.8% ( 16.8 % ) | 14.3% ( 14.3 % )
backlog at year-end | 15000            | 14700            | 14400


at december 31 , 2014  total future minimum commitments under existing non-cancelable operating leases purchase obligations were follows:.
 ( a ) includes $ 2. 3 billion to fiber supply agreements at time of company 2019s 2006 transformation plan forestland sales 2008 acquisition of weyerhaeuser company 2019s containerboard , packaging recycling business.
 rent expense was $ 154 million , $ 168 million $ 185 million for 2014 , 2013 2012 , respectively.
 guarantees in connection with sales of businesses , property  equipment  forestlands other assets  international paper makes representations warranties relating to such businesses assets  may agree to indemnify buyers with tax environmental liabilities  breaches of representations warranties  other matters.
 where liabilities for matters probable subject to reasonable estimation  accrued liabilities are recorded at time of sale as cost of transaction.
 environmental proceedings cercla state actions international paper named as potentially responsible party in environmental remediation actions under federal state laws  including comprehensive environmental response , compensation and liability act ( cercla ).
 many proceedings involve cleanup of hazardous substances at large commercial landfills received waste from many different sources.
 joint several liability authorized under cercla equivalent state laws liability for cercla cleanups typically allocated among many potential responsible parties.
 remedial costs recorded in consolidated financial statements when become probable reasonably estimable.
 international paper estimated probable liability associated with these matters to be approximately $ 95 million in aggregate as of december 31 , 2014.
 cass lake : matters referenced above is closed wood treating facility in cass lake , minnesota.
 during 2009  with environmental site remediation action under cercla international paper submitted to epa remediation feasibility study.
june 2011 , epa selected published proposed soil remedy at site with estimated cost of $ 46 million.
 overall remediation reserve for site is currently $ 50 million to address selection alternative for soil remediation component overall site remedy.
 october 2011 , epa released public statement indicating final soil remedy decision would be delayed.
 in unlikely event epa changes proposed soil remedy approves more expensive clean- up alternative , remediation costs could be material  significantly higher than amounts currently recorded.
 october 2012  natural resource trustees for site provided notice to international paper other potentially responsible parties of intent to perform natural resource damage assessment.
 premature to predict outcome of assessment or to estimate loss or range of loss  if may be incurred.
 other remediation costs in addition to above other remediation costs typically associated with cleanup of hazardous substances at company 2019s current  closed or formerly-owned facilities  recorded as liabilities in balance sheet totaled approximately $ 41 million as of december 31 , 2014.
 completion of required remedial actions not expected to have material effect on consolidated financial statements.
 legal proceedings environmental kalamazoo river : company is potentially responsible party with respect to allied paper , inc. / portage creek/kalamazoo river superfund site ( kalamazoo river superfund site ) in michigan.
 epa asserts site is contaminated primarily by pcbs result of discharges from various paper mills along kalamazoo river including paper mill formerly owned by st.
 regis paper company ( st.
 regis ).
 company is successor in interest to st.
 regis.
company not received orders from epa , in december 2014 , epa sent company a letter demanding payment of $ 19 million to reimburse epa for costs associated with time critical removal action of pcb contaminated sediments from portion of site.
 company 2019s cercla liability not finally determined with respect to this or other portion of site and we declined to reimburse epa time.
 noted, company involved in allocation/ apportionment litigation with to site.
 accordingly premature to estimate loss or range of loss with respect to this site.
 company was named as a defendant by georgia- pacific consumer products lp , fort james corporation and georgia pacific llc in contribution and cost recovery action for alleged pollution at site.
 suit

in millions                | 2015   | 2016  | 2017  | 2018  | 2019  | thereafter
-------------------------- | ------ | ----- | ----- | ----- | ----- | ----------
lease obligations          | $ 142  | $ 106 | $ 84  | $ 63  | $ 45  | $ 91
purchase obligations ( a ) | 3266   | 761   | 583   | 463   | 422   | 1690
total                      | $ 3408 | $ 867 | $ 667 | $ 526 | $ 467 | $ 1781


zimmer holdings , inc.
 2013 form 10-k annual report notes to consolidated financial statements continued ) unrealized gains losses on cash flow hedges unrealized gains losses on available-for-sale securities amortization of prior service costs unrecognized gains losses in actuarial assumptions.
 treasury stock 2013 account for repurchases of common stock under cost method present treasury stock as reduction of stockholders 2019 equity.
 reissue common stock in treasury for limited purposes.
 noncontrolling interest 2013 in 2011  made investment in company acquired controlling financial interest not 100 percent of equity.
 2013  purchased additional shares company from minority shareholders.
 further information related to noncontrolling interests investment not provided not significant to consolidated financial statements.
 accounting pronouncements 2013 effective january 1, 2013 adopted fasb 2019s accounting standard updates ( asus ) requiring reporting of amounts reclassified accumulated other comprehensive income ( oci ) balance sheet offsetting between derivative assets liabilities.
 asus change financial statement disclosure requirements do not impact financial position results of operations or cash flows.
 see note 12 for disclosures relating to oci.
 see note 13 for disclosures relating balance sheet offsetting.
 no other recently issued accounting pronouncements not yet adopted expected material effect on financial position results of operations or cash flows.
 3.
 share-based compensation share-based payments consist of stock options  restricted stock  restricted stock units ( rsus ) employee stock purchase plan.
 share-based compensation expense follows ( in millions ) :.
 share-based compensation cost capitalized as part of inventory for years ended december 31 , 2013 , 2012 2011 was $ 4. 1 million , $ 6.1 million  and $ 8. 8 million , respectively.
 as of december 31 , 2013 and 2012  approximately $ 2. 4 million and $ 3. 3 million capitalized costs remained in finished goods inventory.
 stock options two equity compensation plans in effect at december 31 , 2013 : 2009 stock incentive plan ) and stock plan for non-employee directors.
 2009 plan succeeded 2006 stock incentive plan and teamshare stock option plan ).
 no further awards granted under 2006 plan or teamshare plan since may 2009 shares remaining available for grant under those plans merged into 2009 plan.
 vested and unvested stock options and unvested restricted stock and rsus previously granted under 2006 plan teamshare plan prior 2001 stock incentive plan  remained outstanding as of december 31 , 2013.
 reserved maximum number of shares of common stock available for award under each these plans.
 registered 57. 9 million shares of common stock under these plans.
 2009 plan provides for grant of nonqualified stock options and incentive stock options  long-term performance awards performance shares or units restricted stock  rsus and stock appreciation rights.
 compensation and management development committee of board of directors determines grant date for annual grants under equity compensation plans.
 date for annual grants under 2009 plan to executive officers expected to occur in first quarter of each year following earnings announcements for previous quarter full year.
 stock plan for non-employee directors provides for awards of stock options , restricted stock and rsus to non-employee directors.
 practice to issue shares of common stock upon exercise of stock options from previously unissued shares except in limited circumstances issued from treasury stock.
 total number of awards granted in given year and/or over life of plan under each equity compensation plans is limited.
at december 31 , 2013  aggregate of 10. 4 million shares available for future grants awards under plans.
 stock options granted to under plans generally vest over four years have maximum contractual life of 10 years.
 established under equity compensation plans vesting may accelerate upon retirement after first anniversary date award if criteria met.
 recognize expense related to stock options on straight-line basis over requisite service period less awards expected to forfeited using estimated forfeiture rates.
 due to accelerated retirement provisions requisite service period of stock options range from one to four years.
 stock options granted with exercise price equal to market price of common stock on date of grant except in limited circumstances where local law dictate otherwise.

for the years ended december 31, | 2013           | 2012           | 2011
-------------------------------- | -------------- | -------------- | --------------
stock options                    | $ 24.7         | $ 32.4         | $ 41.7
rsus and other                   | 23.8           | 22.6           | 18.8
total expense pre-tax            | 48.5           | 55.0           | 60.5
tax benefit related to awards    | -15.6 ( 15.6 ) | -16.6 ( 16.6 ) | -17.8 ( 17.8 )
total expense net of tax         | $ 32.9         | $ 38.4         | $ 42.7


management 2019s discussion analysis of financial condition results of operations comcast corporation and subsidiaries28 subsidiaries exchangeable notes varies based upon fair market value of security to it indexed.
 exchangeable notes collateralized by investments in cablevision  microsoft vodafone .
 comcast exchangeable notes collateralized by our class a special common stock held in treasury.
 settled intend future to settle all comcast exchangeable notes using cash.
 during 2004 and 2003  settled aggregate of $ 847 million face amount and $ 638 million face amount of obligations relating to notes exchangeable into comcast stock by delivering cash to counterparty upon maturity of instruments equity collar agreements related to underlying shares expired or settled.
 during 2004 and 2003  settled $ 2. 359 billion face amount and $ 1. 213 billion face amount  of obligations relating to exchangeable notes by delivering underlying shares of common stock to counterparty upon maturity of investments.
 as of december 31 , 2004  debt includes aggregate of $ 1. 699 billion of exchangeable notes including $ 1. 645 billion within current portion of long-term debt.
 of december 31 2004 securities hold collateralizing exchangeable notes sufficient to satisfy debt obligations associated with outstanding exchangeable notes.
 stock repurchases.
 during 2004  under board-authorized $ 2 billion share repurchase program repurchased 46. 9 million shares of our class a special common stock for $ 1. 328 billion.
 expect repurchases to continue in open market or in private transactions subject to market conditions.
 refer to notes 8 and 10 to consolidated financial statements for discussion of financing activities.
 investing activities net cash used in investing activities from continuing operations was $ 4.512 billion for year ended december 31 , 2004  consists primarily of capital expenditures of $ 3. 660 billion , additions to intangible noncurrent assets of $ 628 million acquisition of techtv for approximately $ 300 million.
 capital expenditures.
 most significant recurring investing activity expected to continue be capital expendi- tures.
 following table illustrates capital expenditures incurred in cable segment during 2004 expect to incur in 2005 ( dollars in millions ) :.
 amount capital expenditures for 2005 and subsequent years depend on numerous factors some beyond control including competition  changes in technology timing rate of deployment of new services.
 additions to intangibles.
 additions intangibles during 2004 primarily relate to investment in $ 250 million long-term strategic license agreement with gemstar , multiple dwelling unit contracts of approximately $ 133 million other licenses and software intangibles of approximately $ 168 million.
 investments.
 proceeds from sales , settlements restructurings of investments totaled $ 228 million during 2004  related to sales of non-strategic investments including 20% ( 20 % ) interest in dhc ventures , llc ( discovery health channel ) for approximately $ 149 million.
 consider investments determine non-strategic , highly-valued  or both source of liquidity.
 consider investment in $ 1. 5 billion in time warner common-equivalent preferred stock anticipated source of liquidity.
 not significant contractual funding commitments with respect investments.
 refer to notes 6 and 7 to consolidated financial statements for discussion of investments intangible assets.
 off-balance sheet arrangements not significant off-balance sheet arrangements reasonably likely to have current or future effect on financial condition  results of operations  liquidity  capital expenditures or capital resources.

| 2004   | 2005
----------------------------------------------------------------------- | ------ | ------
deployment of cable modems digital converters and new service offerings | $ 2106 | $ 2300
upgrading of cable systems                                              | 902    | 200
recurring capital projects                                              | 614    | 500
total cable segment capital expenditures                                | $ 3622 | $ 3000


management 2019s discussion analysis 122 jpmorgan chase & co. /2015 annual report wholesale credit portfolio firm 2019s wholesale businesses exposed to credit risk through underwriting  lending  market-making hedging activities with for clients counterparties operating services cash management clearing activities.
 portion of loans originated or acquired by firm 2019s wholesale businesses retained on balance sheet.
 firm distributes significant percentage of loans into market syndicated loan business manage portfolio concentrations credit risk.
 wholesale credit portfolio  excluding oil & gas  stable throughout 2015 by low levels of criticized exposure nonaccrual loans charge-offs.
 growth in loans retained driven by increased client activity notably in commercial real estate.
 discipline in underwriting across all areas lending key point of focus.
 wholesale portfolio actively managed by conducting ongoing in-depth reviews of client credit quality transaction structure inclusive of collateral industry  product client concentrations.
 wholesale credit portfolio december 31 , credit exposure nonperforming ( c ).
 receivables from customers and other ( a ) 13372 28972 2014 2014 total wholesale credit- related assets 434064 438861 1220 899 lending-related commitments 366399 366881 193 103 total wholesale credit exposure $ 800463 $ 805742 $ 1413 $ 1002 credit derivatives used in credit portfolio management activities ( b ) $ ( 20681 ) $ ( 26703 ) $ ( 9 ) $ 2014 liquid securities other cash collateral held against derivatives ( 16580 ) ( 19604 ) na na ) receivables from customers other include $ 13. 3 billion and $ 28. 8 billion of margin loans at december 31 , 2015 and 2014   to prime and retail brokerage customers classified in accrued interest accounts receivable on consolidated balance sheets.
( b ) represents net notional protection purchased sold through credit derivatives manage performing and nonperforming wholesale credit exposures ; derivatives not qualify for hedge accounting under u.
.
 for additional information  see credit derivatives page 129  note 6.
 ( c ) excludes assets acquired in loan satisfactions.

december 31 , ( in millions )                                          | december 31 , 2015 | december 31 , 2014 | 2015       | 2014
---------------------------------------------------------------------- | ------------------ | ------------------ | ---------- | ------
loans retained                                                         | $ 357050           | $ 324502           | $ 988      | $ 599
loans held-for-sale                                                    | 1104               | 3801               | 3          | 4
loans at fair value                                                    | 2861               | 2611               | 25         | 21
loans 2013 reported                                                    | 361015             | 330914             | 1016       | 624
derivative receivables                                                 | 59677              | 78975              | 204        | 275
receivables from customers and other ( a )                             | 13372              | 28972              | 2014       | 2014
total wholesale credit-related assets                                  | 434064             | 438861             | 1220       | 899
lending-related commitments                                            | 366399             | 366881             | 193        | 103
total wholesale credit exposure                                        | $ 800463           | $ 805742           | $ 1413     | $ 1002
credit derivatives usedin credit portfolio management activities ( b ) | $ -20681 ( 20681 ) | $ -26703 ( 26703 ) | $ -9 ( 9 ) | $ 2014
liquid securities and other cash collateral held against derivatives   | -16580 ( 16580 )   | -19604 ( 19604 )   | na         | na


december 31 , 2018.
 alcoa corporation supply required raw materials to arconic arconic process raw materials into finished can sheet coils ready for shipment to end customer.
 tolling revenue for two months ended december 31 , 2016 was approximately $ 37 million.
 in 2017  demand in automotive end market expected to continue grow due to growing demand for innovative products aluminum-intensive vehicles.
 demand from commercial airframe end market expected to be flat in 2017 as ramp up of new programs offset by customer destocking lower build rates for aluminum intensive wide-body programs.
 sales to packaging market expected to decline due to continuing pricing pressure market ramp-down of north american packaging operations.
 net productivity improvements anticipated to continue.
 engineered products and solutions.
 engineered products solutions segment produces products used primarily in aerospace ( commercial and defense )  commercial transportation  power generation end markets.
 products include fastening systems ( titanium , steel , nickel superalloys ) seamless rolled rings ( mostly nickel superalloys ) ; investment castings ( nickel superalloys , titanium aluminum ) airfoils forged jet engine components (. jet engine disks ) extruded , machined formed aircraft parts ( titanium and aluminum ) sold directly to customers and through distributors.
 more than 75% ( 75 % ) of third-party sales in segment from aerospace end market.
 small part of segment also produces forged , extruded , machined metal products ( titanium , aluminum steel ) for oil and gas , industrial products  automotive  land and sea defense end markets.
 seasonal decreases in sales generally experienced in third quarter of year due to european summer slowdown end markets.
 sales and costs expenses of segment transacted in local currency of respective operations mostly u.s.
 dollar  british pound euro.
 in july 2015  arconic completed acquisition of rti , global supplier of titanium specialty metal products services for commercial aerospace defense energy medical device end markets.
 purpose acquisition was to expand arconic 2019s range of titanium offerings add advanced technologies materials primarily related to aerospace end market.
 in 2014  rti generated net sales of $ 794 had approximately 2600 employees.
 operating results assets liabilities of rti included within engineered products and solutions segment since acquisition.
 in march 2015  arconic completed acquisition of tital , privately held aerospace castings company with approximately 650 employees in germany.
 tital produces aluminum titanium investment casting products for aerospace defense end markets.
 in 2014  tital generated sales of approximately $ 100.
 purpose acquisition was to capture increasing demand for advanced jet engine components titanium establish titanium- casting capabilities in europe expand existing aluminum casting capacity.
 operating results assets liabilities of tital included within engineered products and solutions segment since acquisition.
 in november 2014  arconic completed acquisition of firth rixson , global leader in aerospace jet engine components.
 firth rixson manufactures rings forgings metal products for aerospace end market other markets requiring highly-engineered material applications.
 purpose of acquisition was to strengthen arconic 2019s aerospace business position company to capture additional aerospace growth with broader range of high-growth value-add jet engine components.
 firth rixson generated sales of approximately $ 970 in 2014 had 13 operating facilities in united states united kingdom europe asia employing approximately 2400 people combined.
operating results and assets liabilities of firth rixson included within engineered products and solutions segment since date of acquisition.

| 2016   | 2015   | 2014
----------------- | ------ | ------ | ------
third-party sales | $ 5728 | $ 5342 | $ 4217
atoi              | $ 642  | $ 595  | $ 579


expect mst 2019s 2015 net sales comparable to 2014 sales increased volume from new program starts specifically space fence combat rescue presidential helicopter programs offset by decline in volume due to wind-down completion of certain programs.
 operating profit expected to decline mid single digit percentage range from 2014 levels driven by reduction in expected risk retirements in 2015.
 operating profit margin expected slightly decline from 2014 levels.
 space systems business segment engaged in research development design engineering production of satellites strategic defensive missile systems space transportation systems.
 responsible for classified systems services support vital national security systems.
 space systems 2019 major programs include space based infrared system ( sbirs ) aehf gps-iii  geostationary operational environmental satellite r-series ( goes-r ) muos  trident ii d5 fleet ballistic missile ( fbm ) orion.
 operating profit for space systems business segment includes share of earnings for investment in ula  provides expendable launch services to u.
 government.
 space systems 2019 operating results included in millions ) :.
 2014 compared to 2013 space systems 2019 net sales for 2014 increased $ 107 million  or 1% ( 1 % )  compared to 2013.
 increase primarily attributable to higher net sales of approximately $ 340 million for orion program due to increased volume primarily first unmanned test flight of orion mpcv ) $ 145 million for commercial space transportation programs due to launch-related activities.
 increases offset by lower net sales of approximately $ 335 million for government satellite programs due to decreased volume ( primarily aehf  gps-iii muos ) $ 45 million for other programs due to decreased volume.
 space systems 2019 operating profit for 2014 comparable to 2013.
operating profit decreased $ 20 million for government satellite programs due to lower volume primarily aehf gps-iii ) partially offset by increased risk retirements primarily muos ) $ 20 million due to decreased equity earnings for joint ventures.
 decreases offset by higher operating profit $ 30 million for orion program due to increased volume.
 operating profit reduced $ 40 million for charges  net of recoveries related to restructuring action november 2013.
 adjustments not related volume including net profit booking rate adjustments other $ 10 million lower for 2014 compared to 2013.
 2013 space systems 2019 net sales 2013 decreased $ 389 million 5% ( 5 % )  compared to 2012.
 decrease attributable to lower net sales $ 305 million for commercial satellite programs due fewer deliveries ( zero delivered 2013 compared to two 2012 ) $ 290 million for orion program due to lower volume.
 decreases partially offset by higher net sales $ 130 million for government satellite programs due to net increased volume $ 65 million for strategic defensive missile programs primarily fbm ) due to increased volume risk retirements.
 increase for government satellite programs primarily attributable to higher volume on aehf other programs partially offset by lower volume on goes-r , muos sbirs programs.
 space systems 2019 operating profit 2013 decreased $ 38 million 4% ( 4 % )  compared to 2012.
 decrease attributable to lower operating profit $ 50 million for orion program due to lower volume risk retirements $ 30 million for government satellite programs due to decreased risk retirements partially offset by higher equity earnings from joint ventures $ 35 million.
 decrease in operating profit for government satellite programs primarily attributable to lower risk retirements for muos , gps iii other programs partially offset by higher risk retirements for sbirs aehf programs.
operating profit 2013 included $ 15 million charges, net recoveries related to november 2013 restructuring plan.
 adjustments not related to volume including net profit booking rate adjustments other matters approximately $ 15 million lower 2013 compared to 2012.

| 2014             | 2013             | 2012
------------------- | ---------------- | ---------------- | ----------------
net sales           | $ 8065           | $ 7958           | $ 8347
operating profit    | 1039             | 1045             | 1083
operating margins   | 12.9% ( 12.9 % ) | 13.1% ( 13.1 % ) | 13.0% ( 13.0 % )
backlog at year-end | $ 18900          | $ 20500          | $ 18100