INCOME TAXES
 December 22, 2017. enacted tax Tax Cuts Jobs Act. tax code. corporate income tax rate 35 to 21 percent alternative minimum tax deductible interest expense executive compensation deductions.
 Company follows ASC 740-10 deferred tax liabilities assets future tax consequences. liabilities determined financial statements tax tax rates.
 Deferred taxes include loss differences assets liabilities. deferred tax assets
 Tax Assets
 Net operating loss $20,772,428 $20,342,559
 Intangibles 207,618 318,178
 Credits 28,022 112,086
 Other 506,349 613,202
 deferred tax assets 21,514,417 21,386,025
 Liabilities
 Valuation allowance (21,486,396),386,025)
deferred


Adopted Accounting
 April 1, 2018 Company adopted ASU 2014-09-Revenue Contracts Customers 606) amendments (“New Revenue modified retrospective method. applied contracts open. recognized effect retained earnings. comparative information restated reported under accounting standards. adoption impacts net sales revenue sold inventory price concessions. deferred revenue cost shipments distributors until. estimates returns records revenue sale. Sales non-distributor customers recognized upon shipment. cumulative effect changes consolidated April 1, 2018 balance sheet standard summarized table opening balance sheet adjustments. impact adoption consolidated income statement balance sheet March 31, 2019
 changes financial statements due transition from sellthrough to sell-in revenue eliminated deferred income shipments reduced accounts receivable increased retained earnings.recognized revenue New Revenue Standard driven Microchip business.
 March 31, 2019
 New Revenue Standard
 receivable $880. $556. $324.
 $711.
 $191. $154. $36.
 $111. $106. $5.
 deferred tax $1,677. $1,700.
 $787. $420. $367.
 Deferred income shipments $288.
-term deferred tax $706. $689. $16.
 STOCKHOLDERS EQUITY
 Earnings $3,210. $2,975. $235.


Accounts Programs
 recognized
 Consolidated Statements Operations.
 Ended August 31,
 accounts sold $6,751 $5,480 $2,968
 Cash proceeds $6,723 $5,463 $2,962
 Pre-tax losses $28


table summarizes interest rate swap
 no transfers Level 1 2 3 instruments 2019 2018.
 Instruments Not Recorded
 instruments value. cash equivalents restricted cash receivables assets accounts payable accrued price protection liability expenses compensation costs current liabilities. long-term debt not recorded measured fair value disclosure.
 Value December
 Interest rate swap
 Beginning balance $1,623 $734
 Unrealized gain
 Ending balance


recorded non-cash compensation expense stock-based awards
 September 30, 2019 $39. 7 million unrecognized compensation expense unvested RSUs. aggregate value RSUs $40. 0 million 1. 7 years RSUs vested October 1, 2019.
 estimate forfeitures revise forfeiture rate. employee turnover forfeiture rate. forfeiture 12. 5% per year September 30, 2019. compensation expense.
 Cost sales $ 1,766 $ 1,096 $ 338
 administrative 13,722
 $15,488 $5


Tower Corporation 2019 Report
 Appendix 1 Letter Stakeholders
 RECONCILIATION EBITDA NET INCOME. rounding.
 Net Income $672 $970 $1,225,265 $1,917
 Income tax provision
 Other expense
 retirement long-term obligations
 Interest expense
 expenses
 Depreciation amortization accretion 1,285
 Stock-based compensation expense
 ADJUSTED EBITDA $3,067 $3,553 $4,090 $4,667
 Divided revenue $4,772 $5,786 $6,664 $7,440 $7,580
 EBITDA MARGIN 64%


. Property Equipment
 Furniture fixtures computer software leasehold improvements real property recorded cost net depreciation. land historical cost. costs construction internal-use software. Furniture fixtures office equipment computer software depreciated three to five years. Internal-use software three. Leasehold improvements. Real property 15 to 39 years.
 components property equipment
 Depreciation expense 2019 2018 2017 $5. 9 million $5. 7 million $5. 4 million. Amortization-use software $1. 9 million $0. 8 million. 4 million. no disposals write-offs property. disposed wrote off $1. 4 million $0. 8 million costs research development expenses internal-use software. purchased land commercial building Liberty Lake Washington $5. 1 million. OpenEye sales training research development warehousing administrative.
Furniture,604,102
 17,767
 8,949 5
 Construction 4,232 3,790
 18
 property
 Land 1,398
 66,090 48,745
 depreciation (27,542


Amounts financial statements
 assets liabilities balance sheet
 3. Pensions
 £ million
 Schemes net asset
 pension plan Staff Plan 7.
 Cash Plan.
 8.
 net liability
 unfunded plan.
 pension plan surplus 8.


Future Benefit Payments
 future service. Pension corporate.
 $83. $14.
 $82. $15.
 2022 $82. $15.
 2023. $15.
 2024 $81. $15.
 2025-2029 $395. $73.


ITEM 6. FINANCIAL DATA except share
 Statements Operations 2019 2018 2017 Balance Sheet Financial Statements Item 8 Form 10-K. 2016 2015 Balance Sheet Statements. historical results not indicative future. read financial information Item 7's Discussion Analysis Financial Condition Results Consolidated Financial Statements notes 8.
 GS Holdings GSLLC predecessors operations. amounts December 31, 2019 2018 May 24, 2018 2019 GreenSky, Inc. subsidiaries. GreenSky. formation initial capitalization. Note 1 Financial Statements Item 8 organization.
 Consolidated Balance Sheet Data 2019 2018 2017 2016
 Cash equivalents $195,760 $303,390 $224,614 $185,243
 Restricted cash 250,081 155,109 129,224 42,871
receivables 51,926
 Deferred tax assets 364,841 306,979
 951,048 802,889
 Finance 206,035,589 94
 loan,497
 Tax receivable 311,670 260,901
 liabilities 837,670 488,928 89,995
 temporary equity 430,348 335,720
 (60,349
 permanent equity (54,943) (34,765),387
 951,048 802,905,889


results accounting principles use non-GAAP measures EBITDA adjusted EBITDA performance historical results.
 measures not performance GAAP for net income cash liquidity.
 EBITDA net earnings before interest expense taxes depreciation amortization. Adjusted EBITDA adjusted items credit facility.
 measures common performance telecommunications industry evaluate ability fund estimated uses cash. net income Adjusted EBITDA
 includes equity earnings dividend income noncontrolling interests acquisition transaction costs non-cash pension postretirement benefits miscellaneous items.
 cash dividends distributions investments.
 redemption premium write-off unamortized debt costs.
 intangible asset impairment charges.
 compensation expenses stock awards excluded from adjusted EBITDA.
 December

 2019 2018 2015
 Net income (20. (50. 65. 15.
 Interest expense 136. 134. 129. 76. 79.
 Income tax expense (3. (24. 23.
 Depreciation amortization 381. 432. 291. 174. 179.
 494. 492. 362. 289. 261.
 Adjustments EBITDA
. 19. (25. (22.
 Investment distributions 35. 39. 30. 32. 45.
 loss extinguishment debt. 41.
 Loss impairment.
 Non-cash stock-based compensation 6. 3.
 Adjusted EBITDA $ 523. $ 537. 414. 305. 328.


Revision Financial Statements
 September 30 2019 identified misstatement. accounting change Accounting Standards Update. 2014-09 deficit deferred commissions accrued expenses. error material. revised December 31, 2018 balance sheet statements stockholders’ equity misstatement
 Deferred commissions $24,467 $1,064 $25,531
 assets 573,035 1,064 574,099
 Deferred commissions 45,444
 assets 807,156 11,070 818,226
 Accrued expenses 68,331 1,734
 liabilities 400,423 1,734 402,157
 Accumulated deficit (529,962) 9,336
 stockholders’ equity 55,907 9,336
 807,156 11,070 818


. Income Taxes
 domestic foreign
 January 31, 2020 February 1 2019 2 2018
 Domestic $895 $680
 Foreign
 tax $1,438 $1,829 $1,577


. Earnings Per Share
 reconciliation basic diluted earnings 2018 2017
 2019 2018 2017. 1 million shares diluted earnings antidilutive.
 Net income 108,616 13,040 112,062
 Basic shares 30,271 33,003
 Dilutive share-based awards options
 Diluted shares 31,074 33,919 34,553
 Earnings per share
.
 Diluted.


Orders revenue Smart Infrastructure rose regions. higher volume Americas Europe. Africa Middle East. systems Americas. low voltage products-year levels short-cycle markets.
 Adjusted EBITA declined systems software control projects. higher expenses smart building grid edge activities. Severance charges € 48 million 2019 € 34 million. order backlog € 10 billion € 7 billion revenue 2020.
 Smart Infrastructure moderately growing markets 2019. grid markets benefited energy networks automation Asia Australia Americas. Heavy industries infrastructure developed oil gas data centers transportation infrastructure. Discrete industries
 downturn.
 Construction markets growth U. S. China non-residential construction. building electrification automation driven building performance sustainability energy efficiency digital services. 2020 market growth
lower 2019 downturn economic uncertainty trade conflicts.
 2020 distribution transformer business Operating Company Gas Power. Smart Infrastructure orders € 15. 590 billion revenue € 14. 597 billion EBITA € 1. 465 billion margin. %.
.
 Orders 16,244 15,198 7%
 Revenue 15,225 14,445 5%
 business 5,530 4%
 Adjusted EBITA 1,500 1,574
.


Development
 expenses 2019 driven employee compensation costs headcount offset project material costs.
 Year Ended
 December 28, 2019 29, 2018
 $81,499 $74,976 $6,523. 7 %
 revenues 13. 8 %. 2 %
 Ended
 December 29, 2018 30 2017
 $74,976 $73,807 $1,169. 6
 14. 2 % 13. 5 %


. WARRANTIES
 warranty liability revenue recognition. 12 months cover nonconformance defects. warranty begins resold. liability estimated costs failure rates. revisions.
 liability activity
 Fiscal Years
 2018 2017
 $5,756 $3,672 $1,039
/acquired
 Provisions (3,053) 1,865 1,737
 Direct charges 570
 end year $3,273 $5,756 $3,672


tax credit differs standard rate corporation tax 19. 0%.
 losses 30 March 2019 £1. 1m tax losses recognised future recoverability uncertain.
 adjustments prior periods. losses capital allowances revised tax returns.
 52 weeks 30 Mar 2019 31 2018
/profit before taxation.
 Tax credit domestic income tax rate 19. 0%.
 Tax effect
 Non-deductible items.
 disallowable items.
 Impairment goodwill.
 Adjustment share-based payments.
 deferred tax 17. 0%
 Movements losses.
 deferred tax 17.
 Adjustments prior periods.
 Current tax overseas business.
 Income tax credit/(charge.


importance spend on pay
 table shows expenditure pay employees compared distributions. adjusted operating profit shown.
. Remuneration social security pension share-based payment 8.
. Dividends special dividend 2018 12. Removing Special Dividend 2018 $24. 9 million increase. per 2019 $28. 6 million.
. exceptional items acquisition costs amortisation share payment $4. 3 million $19. 6 million 3.
 Employee remuneration 220.
 Distributions.
 Adjusted operating 92.


December 31, 2019 19,577 employees 11,328 engineers 833 administrative staff. implemented labor redundancy plans.
 salaries reviewed annually. adjusted industry standards inflation performance. additional bonuses paid. reserve 10% to 15% new common shares.
 employees participate profit distribution. additional bonuses surplus income. 2020 proposed employee bonus cash NT$1,133 million (US$38 million) earnings 2019.
 covered collective bargaining agreements. good relationship.
 December 31,
 2017 2019
 Employees
 Engineers 11,846 11,651,328
 Technicians
 Administrative Staff
 20,076


Earnings
 excluding unvested restricted stock. Diluted dilutive stock awards options restricted stock contracts treasury stock method.
 table diluted earnings
 98,103 103,547 505 dilutive securities excluded 2019 2018 2017 anti-dilutive.
 average shares 24,118 24,572
 Dilutive effect stock awards
 24,279 24,851 24,777
 Net income operations $53,825 $247,360 $208,644
 Loss discontinued operations taxes
 $53,825 $247 $207


Financial Statements
 Property plant equipment
 No country 1% Property 2019 2018.
 United States $57,095 $49,530
 Japan 79,855
 Thailand 82,389 74,100
 Mexico,147
 Italy
 China 36,396
 Portugal
 Macedonia
 Bulgaria
 Sweden 6
 9
 Non-United States,185,786
 $495,280 $405,316


Discontinued Operations
 December 2015, completed engineering manufacturing sales solar inverter line. results reflected (loss) discontinued operations net Consolidated Statements Operations.
 extended inverter warranties reflected deferred revenue Consolidated Balance Sheets. revenue costs reflected Sales Cost goods. Extended warranties inverter no longer offered.
 ADVANCED ENERGY INDUSTRIES. CONSOLIDATED FINANCIAL STATEMENTS
 Assets Liabilities discontinued operations
 December 31,
 Cash equivalents 5,251
 Accounts receivables 406
 Inventories
 Current assets,855
 Other assets
 Deferred income tax assets
 Non-current assets
 Accounts payable accrued expenses
 Current liabilities
,429
 Other liabilities
discontinued $10,715


Currency Translation Impact Financial Results
. translate foreign results US Dollars. translating significant currencies euro Australian dollar Mexican peso British pound Canadian dollar Brazilian real Chinese Renminbi.
 impact currency translation financial results
 2019. 2018. 2017
 Net sales $ (137. (43.
 Cost sales 98. 31.
 expenses 16.
 Net earnings (15. (8
. GAAP Adjusted EBITDA (25.


Property Equipment
 Depreciation $5. million $6. million $7. million
 2019 2018 2017
 Equipment $22,702 $49,804
 Software 4,088
 Furniture fixtures
 Leasehold improvements
 Construction
 Property equipment 29,327 58,581
 accumulated depreciation (21,671) (51,589)
 $7,656 $7,262


 increased $621 million 2018. Consolidated Income Statement Global Financing. 2019 $1,952 million $473 million debt interest rates Red Hat acquisition.
-GAAP expense increased $393 million. excludes Red Hat pre-closing debt financing costs.
 year December 31.
 Interest expense $1,344 $723.
 Non-operating adjustment
 Acquisition-related charges
 $1,116 $723.


NOTE B ACCOUNTING POLICIES
 Revenue disaggregated source
 Includes conversion royalty bearing license to fully-paid license.
 Revenue from sale unsecured claim against Avaya. third party.
 Company relies on royalty reports licensees revenue. audit dispute royalties. adjusted royalty revenue recorded.
 Revenue patent licensing business from license agreements. revenue depends factors terms obligations. agreements include past infringement liabilities non-refundable license fees ongoing royalties products. settlement litigation patent infringement defendants pay non sum fully-paid license non-refundable sum obligation pay royalties.
 license agreements include grant non-exclusive license manufacture sell products patented technologies release licensee from claims dismissal pending litigation.intellectual property rights licenses extend until expiration patents. Company no obligations non-exclusive licenses. agreements grant releases obligations following execution up-front payment Fully-Paid fee Royalty Bearing License.
 Ongoing Royalty Payments revenue from Licenses royalties quarterly sales contractual royalty rate. Licensees report royalties within 45 days after. provide quarterly royalty reports obligations. reports. royalties due.
 recognizes revenue royalty report arrears criteria.
 Years Ended December 31,
 2018
 Fully-Paid Licenses $130,000 $12,700,000
 Royalty Bearing Licenses 2,907,000 3,086,000
 Other Revenue 6,320,000
 Total Revenue $3,037,000 $22,106,000


ADVANCED ENERGY INDUSTRIES. STATEMENTS.
 net sales extended warranty service contracts product revenue
 Ended December 31,
 2017
 Product service revenue $786,918 $715,055 $667,440
 Extended warranty service contracts 2,030 3,837 3,572
 $788,948 $718,892 $671,012


Sales Marketing Expenses
 increased $105 million 36% 2019. employee compensation costs
 amortization commissions $72 million marketing program costs $8 million. advertising. allocated shared costs $14 million.
 expenses increased $80 million 38% 2018 2017. employee compensation amortization commissions $55 million marketing program costs $10 million. advertising. allocated shared costs $11 million.
 Year Ended December 31,
 % change
 Sales Marketing $ 396,514 $ 291,668 $ 211,918 36%


Financial Statement
 January 3 2020 December 28, 2018 Company recognized $417 million $146 million amortization transition costs project assets. Balance significant.
 Balances net $25 million $29 million dividends 2019 2018 recorded.
 3 2020 combined taxes payable accrued liabilities. prior year activity reclassified current presentation.
 Balance Sheet January 3, 2020 December 28, 2018
 assets
 Transition costs project $98 $145
 Pre-contract costs
 costs $207 $22
 Equity
 $182
 Accounts payable accrued liabilities
 $822 $650
 Deferred revenue
 $1
 Accrued payroll employee benefits
 Salaries bonuses compensation
 $473


operate segments same
 Enterprise Security. Integrated Cyber Defense solutions cloud on-premises security cost complexity. Consumer Cyber Safety. Norton LifeLock devices online privacy identities home networks.
 Operating segments based business. Chief Operating Decision Makers performance allocate resources.
 no inter-segment sales. table summarizes results
. Segment Geographic Information
 29, 2019 2018
 segments
 revenues $4,731 $4,834 $4,019
 income $1,414 $1,584
 Enterprise Security
 revenues $2,323 $2 $2
 income
 Consumer Cyber Safety
 revenues $2,408 $2,280
 income


. Shipments Net Revenue 2019 2018
 Shipments 12-inch wafers Net Revenue
 Domestic Taiwan. packaging mask making design royalties.
 2018 net revenue new method estimated returns allowances transactions. method relevant breakdown.
 Net Revenue
 Domestic 1,678 91,259,259 1,575 81,718,513
 Export 8,390 836,058,092 9,177 829,577,851
 8,835,783 8,398,094
 Export 133,832,314 111,779,099
 Domestic 1,678 100,095,042 1,575 90,116,607
 Export 8,390 969,890,406 941,356,950


Systems revenue $7,604 million decreased. 3 percent (4 percent adjusted. Hardware $5,918 million declined. (6 percent Power Systems Storage Systems. Operating Systems Software $1,686 million grew. percent (3 percent adjusted.
 IBM Z revenue decreased. percent flat adjusted. declined z14 cycle growth fourth z15. data privacy resiliency hybrid cloud.
 encryption cloud-native development instant recovery. OpenShift IBM Z
. high-value secure scalable platform.
 Power Systems revenue decreased 13. 5 percent (12 percent Linux POWER9.
 Storage Systems revenue decreased 8. 9 percent improvements fourth quarter 2019 launch next generation high-end
 DS8900.
 cloud revenue $2. 9 billion declined 4 percent 3 percent adjusted.
.Percent. Currency
 revenue $7,604 $8,034 (5.
 Hardware $5,918 $6,363 (7.
 IBM.
 Power Systems (13.
 Storage Systems.
 Operating Systems Software 1,686 1,671.


Liquidity Capital Resources
 December 31, 2019 cash equivalents $92. 7 million restricted cash $0. 4 million net accounts receivable $50. 4 million. working capital $115. 2 million.
 uses cash operating expenses purchases property intangible assets acquisition. debt. equivalents impacted timing accounts payable accrued expenses.
 expenses excludes non-cash items stock-based compensation amortization depreciation acquired leased right-use assets impairment. acquisitions capital purchases investing activities.
 primary sources cash receipts products distributors customers. cash collections impacted efficiency.
 credit agreement acquisition Exar incremental loans not exceed $160. 0 million unlimited amount. not requested incremental loans.
 summary working capital cash equivalents restricted cash
December
 Working capital $115,208 110,044
 equivalents $92,708 $73,142
 Short-term
 Long-term 60 404
 $93,117 74,191


payables accrued liabilities
 instruments Note 27.
 December 31, 2019 payables equity investments nil $49 million 2018 joint venture Ericsson.
 January 1 2019 adopted lease accounting lease obligation payables liabilities. impact Note 11.
 insignificant amounts December 31, 2019 2018 “Others”.
 Employee liabilities 375
 compensated absences
 Taxes
 Advances
 Payables equity investments
 Derivative instruments
 Provision restructuring
 benefit plans
 plans
 long-term benefits
 Royalties
 lease obligation
 Deferred consideration business combinations


Years Ended December 31, 2019 2018:
 Revenue
 Services. fees customer support partners. provide remotely proprietary technology. licensing Support. Cloud applications. 2019 decreased $4. 9 million from 2018. due billable hours major customers. 2019 $56. 6 million $61. 0 million 2018. direct services revenue $2. 9 million $3. 5 million 2018. growth opportunities difficult. experiencing. opportunity growth evolving support market trends.
 Software. fees end-user software customer downloads sale partners. 2019 decreased due cancellation partner contract softness new subscriptions renewals. direct software revenue $1. 9 million $2. 8 million 2018. partnerships $1. 9 million $2. 7 million 2018.
 2019
 Services $59,545 $64,476
 Software 3,788 5,073
$63,333,549


performance measures
 Net debt earnings before tax
 debt EBITDA. depreciation amortisation property software development profit. excludes IFRS 16 lease liabilities. EBITDA ratio
 components Note 24.
 Adjusted operating profit 282. 264.
 Depreciation amortisation property development 34.
 Earnings before interest tax depreciation amortisation 317. 297.
 295. 235.
 EBITDA.


Subsidiaries joint ventures associates
 Intu) Finance Metrocentre Finance plc consolidated not listed table Group own shares. issuing debt. obligations loan agreement security investment property deed charge companies.
 Non-controlling interests
 40 per cent interest Metrocentre Partnership GIC Real Estate 40 directors Metrocentre. GIC Real Estate owns 40 per cent interest Metrocentre Lancaster LLP. £58. 2 million non-controlling interest losses 31 December 2019. £70. 9 million loss. GIC Real Estate’s interest. financial information Metrocentre Partnership Metrocentre LLP consolidated
 balance sheet non-controlling interest recoverable £58. 2 million. £195. 4 million owed borrowings 23.
 income statement
 Revenue 64.
 Loss (177.
balance sheet
 Investment development property. 841.
 4. 125% bonds.
 financial. (473.
 liabilities (27. (31.
 (319.


Veradigm
 revenue data-driven clinical insights tools workflow research media. solutions healthcare stakeholders improve quality efficiency value healthcare delivery biopharma health plans providers patients technology partners.
 2019
 Veradigm revenue increased organic sales. Gross profit income operations increased cost reductions headcount growth hosting migration costs. acquisition Practice Fusion contributed.
 Gross margin operating margin decreased hosting migration costs acquisitions headcount growth.
 Veradigm revenue gross profit margin income increased due acquisition Practice Fusion. Operating margin decreased higher personnel costs Practice Fusion acquisition hosting.
 Year Ended December
 Revenue $161,216 $140,326 $69,879 14.
 Gross profit $104,896 $100,708 $43,817 4. 2% 129. 8%
margin 65. 71. 62. 7%
 Income operations $43,996,816.
 Operating margin 27. 34.


PSU plan
 Corporation offers Performance Share Unit Plan executive officers employees. objectives retain officers employees interests shareholders sustain positive corporate performance measured by economic value creation formula.
 PSUs based on dollar value average closing stock price previous twelve August 31. PSUs vest over three-year period economic value no vesting no increase economic value.
 participants receive dividend equivalents additional PSUs vested PSUs. PSUs redeemable death disability retirement termination employment payment time employment grant to termination.
 trust created shares stock price fluctuation shares. shares held trust until vested. trust consolidated financial statements with value acquired shares.
 PSUs granted outstanding at August 31 2019
 granted 14,625 (19,025 2018) PSUs to Cogeco's executive officers.
compensation expense $1,400,000$2,198,000 2018) August 2019.
 133,181 115,207
 45,800 65,525
 units 2,639
,319)
 Cancelled (31,889
 Dividend 3,578,435
 107,551 133,181


INCOME TAXES
 December 31, 2019 Company net operating loss $18. 3 million pre-2018 losses $14. 3 million 2020 2037 post-2017 losses $4 million. losses offset future taxable income. formed 2006 limited liability corporation 2007. not reflected corporate tax returns. loss differ differences.
 Federal income tax
 tax
 Current operations $848,000
 Acquisition costs
 Change fair value contingent
 permanent items 29,000
 Deferred Adjustment (913,000
 Valuation allowance
 provision federal income tax $897,960


Non-GAAP diluted earnings exclude TCJA restructuring expenses. Non-GAAP Financial Measures.
 2019
 Revenue increased $15. 5 billion 14%. Intelligent. Productivity Business Processes Office LinkedIn. Personal Computing Surface Gaming Windows.
 Gross margin increased $10. 9 billion 15%. percentage sales. 5 commercial cloud.
 Operating income increased $7. 9 billion 23% growth.
 Cost revenue increased $4. 6 billion 12% cloud Surface Gaming.
 Research development expenses increased $2. 2 billion 15% cloud LinkedIn GitHub.
 Sales marketing expenses increased $744 million 4% LinkedIn GitHub. foreign currency impact 2%.
 net income $2. 6 billion tax benefit property transfers $157 million charge TCJA diluted EPS $2. 4 billion. impacted TCJA $13. 7 billion..
 Revenue increased $13. billion 14% growth. Productivity Business Processes LinkedIn Office. Intelligent Cloud server cloud services. Personal Computing Gaming Windows Search advertising Surface Phone.
 Gross margin increased $9. billion 16% growth. sales. 7 commercial cloud Azure.
 Operating income increased $6. billion 21% growth. LinkedIn loss increased $63 million $987 million $1. billion amortization intangible assets. foreign currency impact 2%.
 Cost revenue increased $4. billion 12% commercial cloud Gaming LinkedIn Search advertising Phone. Sales marketing expenses increased $2. billion 13% LinkedIn. Research development $1. billion 13% cloud LinkedIn. administrative expenses increased $273 million 6% LinkedIn.
 2018 income TCJA earnings $13. billion. 2017 restructuring expenses $306 million $243 million.
millions 2019
 Revenue 125,843 110,360 96,571 14%
 Gross margin 82,933 72,007 62,310
 Operating income 42,959 35,058 29,025
 Net income 39,240 16,571 25,489 137%
 Diluted earnings share.
 Non-GAAP income 42,959 35,058 29,331
 income 36,830 30,267 25,732
 diluted earnings share.


Consolidated Net Income EBITDA Adjusted EBITDA
 before interest taxes depreciation non accepted accounting principles) measures useful investors profitability depreciation amortization capital expenditures
 performance Verizon’s competitors. EBITDA interest taxes depreciation amortization expenses net income.
 Adjusted EBITDA non-operational items equity losses unconsolidated businesses income expense special items. effectiveness operations business trends.
 Consolidated Adjusted EBITDA operating performance competitors impacts capital structure taxes depreciation policies. exclusion non-operational items special items enables comparability prior period performance trend analysis. Items”.
 non-GAAP financial information understanding Verizon’s GAAP information financial statements. non-GAAP financial measure presented GAAP measure.
non-GAAP measures provide information consolidated segment performance. comparable.
 Includes Pension benefits adjustments debt redemption costs. Product realignment impairment charges. Excludes depreciation amortization.
 changes Consolidated Net Income EBITDA Adjusted EBITDA operating revenues expenses.
 Consolidated Net Income $19,788 $16,039
 Provision income taxes
 Interest expense
 Depreciation amortization 16,682
 Consolidated EBITDA 44,145 41,859
 losses unconsolidated
 Severance charges
 Acquisition integration
 Product realignment
 Impairment charges
 gain dispositions assets
 Consolidated Adjusted EBITDA $ 47,189 47,410


FINANCIAL STATEMENTS
 accrued post-retirement plan Balance Sheets December 31
-Retirement Insurance Plan
 Accrued expenses liabilities
 Long-term pension obligations,188
 accrued cost(4,766)(4,595)


changes unrecognized tax benefits
 2019 2018 2017 tax expense $128,000 $143,000 $76,000 uncertain tax positions. interest penalties benefits. accrued $22,000 $15,000 $11,000 interest penalties.
 subject taxation United States states foreign countries. audit IRS foreign NOL carryforwards income tax years open. unrecognized tax benefits increase 12 months.
 Deferred income taxes undistributed earnings foreign subsidiaries. December 31, 2019 $0. 6 million unremitted earnings reinvested.
 unrecognized tax benefits $469 $326 $250
 Additions current year tax positions 106 142
 Reductions prior year tax positions
 balance interest penalties 575 454 315
 Interest penalties
 $597 $469 $326


Cash flows operating activities largest source collections from customers license agreements. Payments terms. cash from sales licenses cloud services hardware services. primary uses for employee expenditures material manufacturing costs taxes interest payments leased facilities.
 Net cash decreased 2019 due to unfavorable changes working capital income taxes first installment payment transition tax.
 Cash flows investing activities purchases maturities sales debt securities capital assets.
 Net cash $26. 6 billion 2019 $5. 6 billion 2018. increase due to increase sales maturities decrease purchases securities.
 Cash flows financing activities borrowings repayments debt instruments stock repurchases dividend payments proceeds employee stock programs.
 cash increased due to increased stock repurchases $36. 1 billion $11. 3 billion 2018.
Ended May 31,
 operating $14,551 -5% $15,386
 investing $26,557 572% $(5,625)
 financing $(42,056) 321%


Computer Software
 fourth quarter 2019 acquire cash products services. acquired $32. million valued $6. 5 million December 31, non investing $4. 8 million.
 developed $808. $746.
 Purchased.
. 806.
 Accumulated amortization (481. (401.
 $406. $405.


Net Income Share
 dilutive securities excluded
 Fiscal Year
 27, 2019 28, 29, 2017
 Restricted Awards 132,861 84,511
 Stock options 201,799
 Convertible notes 76,384


Property Plant Equipment
 Fiber conduit plant cable poles structures.
 Central office network electronics switches routers electronics.
 Support assets buildings cable stations data centers computers administrative equipment.
 Construction.
 depreciation expense $3. 1 billion $3. 3 billion $2. 7 billion 2019 2018 2017.
 Depreciable Lives December 31
 Fiber conduit 15-45 years 24,666
 Central office 3-10 years 19,608 18
 Support 3-30 years 7,984
 Construction
 property plant equipment 55,425 53,267
 Accumulated depreciation
 $26,079


Earnings per share
 Basic diluted earnings
 average adjusted remove ESOP
 Diluted shares include dilutive convertible bonds options awards.
 2017 Group incurred £49. 4 million share charge Spanish Eurofund’s future interests intu Costa del Sol. positive impact intu retained earnings £49. 4 million. 31 December 2019 received final ratifications positive impact earnings reverse arrangements concluded.
 2018
 Loss £m Shares million Loss per
. 1,344.
 Diluted2. 1,344.


Cash Equivalents Restricted Cash
 liquid investments maturities three months. Restricted cash contracts regulations. refundable deposits funds escrow.
 cash equivalents restricted cash consolidated balance sheets
 2019 2018
 Cash equivalents $19,505 $18,017
 Restricted cash 1,205 1,444
 cash equivalents $20,710 $19,461


Exclude adjustments migration new customer management system third quarter 2018.
 Canadian broadband services new customer management system 22 systems. contact center congestion lower services activations fourth quarter. Contact center marketing operations returned normal first quarter 2019.
 Variations services
 INTERNET 2019 fourth-quarter net additions 2,540 losses 2,965 prior high speed bundle offers increased demand Internet resellers offset competitive offers.
 VIDEO 2019 net losses 8,164 15,953 competitive offers changing video consumption environment offset digital video fast Internet.
 TELEPHONY 2019 fourth-quarter net additions 2,778 losses 16,900 prior more telephony bundles growth business sector offset increasing wireless penetration unlimited offers landline wireless.
 Net additions
 Three months ended August
1,810,366
 Internet 788,243
 Video 649,583 (8,164)
 Telephony 372,540 2,778


Parent entity financial information
 statements show amounts
 NEXTDC acquired Asia Pacific Data Centre 18 October 2018. entities APDC wound properties transferred Holdings Trust. 1. loss entity derecognition investment APDC gain NEXTDC Holdings Trust. 1 transfer properties.
 Reserves
 loan NEXTDC NEXTDC Share Plan Pty Ltd requires treasury shares debit to equity.
 Guarantees entity debts subsidiaries
 30 June 2019 guarantees.
 Contingent liabilities NEXTDC
 2019 2018.
 Contractual commitments NEXTDC property plant equipment
 NEXTDC Limited entity.
 entity financial information
 consolidated financial statements.
 Tax consolidation legislation
 NEXTDC Limited controlled entities implemented legislation.
 controlled entities account current deferred tax amounts.tax amounts measured entity Group stand-alone taxpayer.
 NEXTDC Limited recognises current tax liabilities deferred tax assets unused tax losses credits controlled entities.
 tax funding agreement compensate NEXTDC Limited current tax receivable deferred tax assets unused tax losses credits. funding amounts determined financial statements.
 amounts receivable/payable due funding advice head entity year. interim funding.
 Assets liabilities tax funding agreements recognised current receivable entities.
 difference contribution to wholly-owned entities.
 Investments in subsidiaries associates joint venture entities
 accounted cost financial statements NEXTDC Limited.
 2019 2018
 Current assets 447,698,222
 Non-current assets 1,121,500 771,702
1,569,198 1,235,924
 63,382
,979 305,463
 950,361 341,947
 618,837 893,977
 905,117,247
 Reserves
 earnings (292,565)
 618,837 893,977
 (266,311) 6,639


summary options vested December 31, 2019
 total value options 2019 2018 2017 $318. 5 million $17. 4 million $6. 6 million.
 weighted average value options $19. 80 $9. 07 $6. 44 per share. 2019 2,141,078 options vested. 2,939,947 options unvested December 31, 2019.
 $30. 3 million unrecognized compensation cost options 2. 5 years.
 Options Exercisable
 Weighted Average Life
. 50 to $1. 90 32,913.
. 209.
.,869.
. 2,227,421. 1,587,924.
. 1,772,062. 560,632.
. 847,010.
. 297,341.
 5,884,742,944,795


. Inventories
. Finished goods 2018 $1. 8 million deferred costs reclassified trade receivables 2.
 expense $1. 6 million. charged income statement inventory write-downs. no reversals prior inventory write-downs.
 inventories value costs.
 materials.
 progress.
 Finished.
.


calculated net weighted shares common stock. Diluted earnings calculated potential options. effects potential stock determined treasury stock method
 years December 2019 2018 2017. 627. 724. 478 stock options not included diluted earnings.
 Years December
 Basic weighted-average shares 103. 9. 102.
 Effect potential common stock
 stock awards.
 Diluted weighted-average shares 105. 104. 4 103.


Income summarized
 gains debt investments lower losses market conditions timing sales.
 marketable equity investments market value fluctuations timing.
 non equity investments lower gains offset higher unrealized gains.
 driven higher donation expense.
 2019.
 2018 2017 Variance Dollars
 Gains (losses investments
-sale debt investments $(13)
 Marketable equity investments 529 (45)
 Non-marketable equity investments 6
 Net gains (losses (133) (308)
 Other gains (87) (133)
 income $(97) $165 $(163)(262)


2019 recognized income $103 million increasing $53 million 2018 grants European Commission IPCEI Italy France offset start-up costs production 200 mm fab Micron Technology. Singapore.
 2018 recognized income $53 million decreasing $55 million 2017 lower R&D grants.
 Ended
 Research development funding $132 $52 $65
 Phase-out start-up costs (38)
 Exchange gain
 Patent costs
 Gain sale businesses non assets 7
 income expenses $103 $53 $55
 revenues.


. SELECTED FINANCIAL DATA
 fiscal 2019 2018 2017 August 31, from audited Consolidated Financial Statements Notes. 2016 2015. data read with “Management’s Discussion Analysis Financial Condition Results Consolidated Financial Statements Notes.
 September 1, 2018 adopted FASB ASU No. 2014-09 Revenue Contracts Customers 606) eliminated net revenues presentation FASB No. 2017-07 Compensation-Retirement Benefits 715) Net Periodic Pension Cost Postretirement Benefit Cost. Prior amounts revised current.
 $258 million charge tax law changes 2018.
 $312 million pension settlement charge 2017.
 $745 million gain on sale businesses 2016.
 $39 million pension settlement charge 2015.
 2019 2018 2017 2016 2015
.
 Income Statement
 Revenues $43,215 $40,993 $36,177 $34,254 $32,406
 Operating income 6,305 5,899
 Net 4,215 3,635 3,274
 Accenture 4,779 4,060
 Earnings Share
 $7. 49 $6. 56 $6. 58 $4.
.
 Dividends ordinary share 2. 92.


 balance
 manufacturer supplier prepayments $143,392 $131,642
 taxes 8,046 9,646
 maintenance services 8,503,487
 16,753 12,744
 $176,694 $162,519


2019 recorded $5 million equipment licenses development projects cancelled no alternative use.
 2018 recorded $21 million $19 million set-top box plan $2 million acquired technologies no future alternative use.
 2017 recorded $45 million $34 million set-top box $13 million Bouskoura Morocco
 $3 million unused lease provision $5 million reversal provisions Embedded Processing Solutions restructuring plan provisions not used.
 Year Ended December 31,
 2019 2018
 millions
 Impairment restructuring charges costs


ITEM 6. SELECTED FINANCIAL DATA
 consolidated financial data not indicative future operations read with Item 7's Discussion Analysis Financial Condition Results statements Item 8 Form 10-K.
 financial data years January 2019 2018 derived audited statements. Operations Cash Flows January 31, 2017. Consolidated Balance Sheet remaining 2016 2015 derived audited statements not.
 impact new accounting standards 2019 revenue recognition. Part II Item 8 Note 1 Business Summary Accounting Policies.
 Fiscal Year Ended January 31,
 2018 2017 2016 2015
 Net revenue $2,569. $2,056. $2,031. $2,504. $2,512.
) income operations (25. (509. (499. 120.
 Net (loss) income (80.(566. (582. 81.
 Cash flow $377. $169. $414. $708.
 stock data
 income share. 37. 61.
 income share.
 assets $4,729. $4,113. $4,798. $5,515. $4,909.
 liabilities 2,638. 2,246. 1,879. 2,304. 1,290.
 equity. $733. $1,619. $2,219.


. Product Warranties
 Company one-year warranty quality. extended. establishes warranty reserves product history repair sales. April 30 2019 2018 changes accrued warranty costs
 2019 2018
 Balance $520 $557
 Warranty costs (398)
 407
 end year $529 $520


Obligations
 long-term debt-cancelable leases feed grains construction contracts workers’ compensation October 31, 2019
 Payments Due
 Obligations 1-3 Years 3-5 5
 leases 47,774 $15,363 $22,919 9,382
 Long-term debt 55,000
 Purchase
 Feed grains packaging supplies 199,097
 Construction contracts,996
 Claims payable 20,587
 331,454 $233,143 $33,819 64,382


Group’s associates related.
 30 March 2019 shareholdings 10% share capital
 Nissin Foods Holdings. related 19. 47% (2017/18. 57%) equity shareholding Premier Foods member. Oasis Management Company Ltd related 11. 99%. 01%) equity shareholding Premier Foods.
 Paulson Investment Company LLC related 11. 98% (2017/18. 39%) equity shareholding Premier Foods member Board.
 30 March 2019 Group outstanding balances Hovis. trade receivables £0. 9m (2017/18. 5m trade payables £0. 6m. 5m.
 52 weeks
 30 Mar 2019 31 2018
 Sale goods
.
 services
.
.
.
 Purchase goods
.
.
. 19.


Loss per share
 computed weighted average common shares. Diluted earnings reflect dilutive impact stock options restricted stock awards. Included shares consideration Restaurant Magic Acquisition 908,192. shares issued January 2020 no contingencies acquisition.
 reconciliation weighted average shares basic diluted loss
 December 31, 2019 2018 383,000 750,000 shares stock options excluded diluted earnings anti-dilutive effect. 308,000 restricted stock awards excluded 2019 113,000 2018.
 Net Loss $(15,571) $(24,122)
 average shares outstanding 16,041 15,949
 issued
 16,223 16,041
 Loss per common share.
 impact stock options restricted stock awards
 Loss per common share.


ASSETS
 intangible acquisition SensiML December 2019
 Gross Carrying Amount Accumulated Amortization Net Carrying Amount
 Developed technology $959 $863
 Customer relationships 81
 Trade names marks
 intangible assets $1,156


Note 4. Special Charges Other Net
 table summarizes charges other net Company consolidated statements income
 Company evaluates operations cost savings operational efficiencies. approach to businesses acquired not efficient savings efficiencies. following acquisition restructuring expenses timing. position contract expense against strategic objectives targets operational priorities. Decisions restructuring "rolling during acquisition managers recommendations. estimate future employee separation exit costs.
 restructuring expenses fiscal year March 31, 2019 related to business acquisitions from workforce property operating expense rationalizations combining product roadmaps manufacturing operations. employee separation costs intangible asset impairment charges. impairment charges recognized writing off intangible assets purchased from Microsemi impaired changes product roadmaps after acquisition.costs Microsemi transaction acquisitions. future expenses.
 2018 incurred contract exit costs $19. 5 million transitioning utility. energy wafer fabrication facility. signed ten-year agreement energy less average usage watt. incurred $1. 2 million employee separation costs acquisition Atmel.
 restructuring expenses related acquisitions Atmel Micrel workforce property operating rationalizations product roadmaps manufacturing operations. employee separation costs contract exit costs operating expenses impairment losses. charges changes product roadmaps acquisition Atmel. March 31, 2017 activities complete.
 restructuring activities semiconductor products segment. incurred $115. 2 million 2016 employee separation activities $65. 3 million $1. 2 million $39. 1 million 2019 2018 2017. future expenses. future employee separation costs. $40.8 million costs contract exit 2016 $4. 7 million income March 31, 2019 $0. 7 million $44. 1 million costs 2018 2017. vacated lease liabilities. expects exit expenses.
 months June 30 2017 sale Micrel $10. million gain $4. million gain sale.
 Years March
 Employee separation costs $65. $1. $39.
 Gain sale assets (4.
 Impairment charges 3. 12.
 Contract exit costs. 44.
.
 Legal contingencies (30.
 Non-restructuring contract exit costs.
 $33. $17. $98.


VMware Stock Repurchases
. stock price cash corporate legal regulatory requirements market conditions. not obligated. additional purchases. purchases private transactions Dell. shares repurchased retired.
 table summarizes stock repurchase activity purchase price millions
 purchase price paid capital balance zero excess retained earnings.
 January 31, 2020 February 1, 2019 2, 2018
 Aggregate purchase price $1,334 $42 $1,449
 Class A common stock repurchased 7,664 13,977
 Weighted-average price per share $174. $148.


 Research Development
 increased $47 million 30% 2019. employee compensation $34 million headcount growth allocated shared costs $8 million.
 increased $45 million 39% 2018. employee compensation $36 million headcount shared costs $6 million.
 Ended December 31,
 thousands
 Research Development $ 207,548 $ 160,260 115,291 39%


. INVESTMENTS LOANS SUBSIDIARIES
 Interest subsidiary Bank prime rate two. repayment 24 installments US$2 million 2018 final US$5. 3 million December 2043.
 non 46,698 45,377
 2,064,123
 48,762 47,500


EBITDA
 three-month period August 31, 2019 average foreign exchange rate. 3222 USD/CDN.
 Fiscal 2018 restated IFRS 15 accounting policy Cogeco Peer 1 discontinued operations. policies operations sections.
 Fiscal 2019 translated average foreign exchange rate. 3100 USD/CDN.
 2019 fourth-quarter EBITDA increased. 6%. American broadband services growth FiberLight acquisition Canadian broadband services decline operating expenses.
 months August currency Foreign exchange impact
 Canadian broadband services 172,120 166,181.
 American broadband services 115,523 109,937.
 Inter-segment eliminations.
 275,610 263,411.


. Debtors
 owed subsidiaries amortised cost loans receivables reduced credit losses. future credit losses probability default. balances written off collectible. instruments measured fair value profit loss.
 Amounts owed subsidiaries unsecured fixed repayable demand liquidity. credit losses immateria
 due year
 242,976 220,871
 Taxation recoverable
 debtors
 instruments
 243,424 221,233
 due one year
 3,439 2,449
 Deferred tax


contract liabilities caused timing consideration.
 Company recognized NT$3,815 million NT$616 million revenues contract liabilities obligations December 2018 2019.
 January 1,2018 December 31,2018
 NT$ Thousands
 Sales goods services $3,951,414 $932,371 $1,470,195
 $988,115
 Noncurrent 482,080


earnings share computed-average. Diluted earnings dilutive potential shares treasury stock method. include options awards.
 Includes $2. billion. basic diluted earnings per share 2018. tax reform.
 shares outstanding December 31, 2019 2018 887. 1 million 892. 5 million.-to decrease common stock repurchase program. average
 23. million shares lower 2019 2018
. Percent Change
 Earnings per share common stock continuing operations
 dilution $10. $9.
.
 Diluted $12. $13.
 Weighted-average shares
 892. 916.
.


. Registrant’s Common Equity Stockholder Matters Issuer Purchases Securities
 common stock trades Nasdaq Stock Market ZIXI. high low sales prices quarter 2019 2018.
 March 4 2020 55,641,885 shares stock 399 shareholders. last sales price $8. 27.
 cash dividends.
 options stock-based compensation awards. Security Ownership Beneficial Owners Management Stockholder Matters.
 31 9. 5. 4. 3.
 11. 4.
 10. 6. 4.
 7. 75 6 4.


Debt
 table effects issuances prepayments conversions debt 2019. notice conversion obligations derivative debt liabilities-average price stock 20 days. reclassify equity converted notes derivative debt.
 2018 repurchased redeemed $6. 96 billion. $9. 42 billion cash 4 million shares treasury stock. August 30, 2018 $35 million 2033F Notes $165 converted not settled. settled 2019 $153 million cash. non-operating losses $385 million 2018.
 2017 repurchased redeemed $1. 55 billion notes. $1. 63 billion cash. non-operating losses $94 million.
.
.
 $44 million 2033F Notes $179 million converted not settled. settled 2020 $192 million cash.
Increase Principal Carrying Value Cash Equity
 Issuances
 2024 Notes(1) $600 $597
 2026 Notes(1) 500 497
 2027 Notes(2) 895
 2029 Notes(1) 695
 2030 Notes(2) 850 845
 Prepayments
 2022 Term Loan B (728)
 Settled conversions
 2032D Notes
 2033F Notes
 2043G Notes (1,019)
 Conversions not settled
 2033F Notes(3)
 $1,748 $2,068 $1,148 $(515)


CONSOLIDATED FINANCIAL STATEMENTS
 Contract Assets Liabilities
 Balance Sheets
 twelve months December 31, 2019 recognized revenues $256 liabilities.
 Assets
 Prepaid rebates
 Assets $1,917 $1,064
 Liabilities
 Customer discounts price concessions Accrued expenses $(2,070) $(1,656)
 rights return
 Liabilities $(2,877 $(1,981


Deferred Tax
 unused tax losses €187 million €213 million 2017: €263 million. state tax loss carryforwards.
 not recognized deferred tax liability €17. 41 billion (2018 €14. billion undistributed profits subsidiaries.
 2018
 Unused tax losses
 688 575 375
 535
 tax losses 1,124 1,058 919
 Deductible temporary differences 538 509 524
 Unused research foreign tax credits
 unused tax credits 45 72


Company has plan 2007 Stock Compensation Plan grants equity awards directors officers employees. 851,134 shares September 2019. $2,371,309 unrecognized compensation expense 4. 9 years. recorded expense 2019 2018 2017 $1,729,025 $2,003,207 $2,319,975. 2019 $1,638,829 $90,196. 2018 $1,835,086 $168,121. 2017 $2,103,621 $216,354.
 Black-Scholes option pricing model. 2019 granted options 172,000 shares common stock 4 years three year vesting exercise price $12. 17. 2018 granted 108,000 shares stock term 4. 7 years three year vesting exercise price $13. 37. no stock options granted 2017. fair value estimated grant date
expected stock price volatility historical volatility stock expected life. options after grant date. risk-free interest rate reflects grant date zero-coupon. governmental bonds option.
 Options granted fair market values vesting three to five-year. directors one year vesting six year contractual term. maximum six years. Shares issued stock option from authorized unissued shares. 36,000 options vested 2019 no 2018. 6,750. 2,250. intrinsic value options $81,728 $75,767.
 Dividend yield 0%
 expected volatility 37. 77%. 68%
 risk-free interest rate 2. 92%. 70%
 expected life 3.
 Vesting period.


Stock Option Award Amendment
 Board Directors amended 2011 Equity Incentive Plan 1,000,000 options. allocated management employees.
 granted 755,000 234,000 options two three years exercise price $4. 70 per share.
 Black-Scholes option pricing model
 volatility historical.
 compensation expense $0. 1 million 2019 unrecognized cost non options $0. 5 million vesting period 2. 1 years.
 Volatility.
 Dividend yield.
 Risk-free interest rate.
-average grant date fair value.


Obligations Commercial Commitments
 lease office space equipment October 2028. Credit Agreement April 2024 issued Senior Notes August 2026.
 Contractual obligations December 31, 2019
 Term Loans 4. 05%.
 Revolving Credit Facility 3. 99%.
 2026 Notes $400. million annual interest rate 5. 750%.
 financed multi-year license agreements software $10. 4 million payments April 1 2022. $13. 8 million $6. million $7. 8 million Consolidated Balance Sheet IV.
 estimate reserves. liability unrecognized tax benefits $29. million.
 Payments
 1-3 3-5 5 years
 Operating lease obligations $ 70,284 17,180
 Term loans 756,060
loans 117,168 30,025 55,232
 Revolving credit facility 239,000
 40,528 9,536 19,072 11,920
 400,000
 149,500
 software 13,822 5,974 7,848
 $1,786,362 $124,665 $240,649,298


NAVIOS MARITIME HOLDINGS. FINANCIAL STATEMENTS.
 INTEREST EXPENSE COST
 2019 2018 2017
 Interest expense $125,496 $129,941 $115,099
 Amortization deferred financing costs 7,746,866 6,391
 $133,479 $137,916 $121,611


ADVANCED ENERGY INDUSTRIES. FINANCIAL STATEMENTS
 effective tax rate differs. federal 35% December 2017 solar inverter business earnings foreign jurisdictions. tax reform. causes
 2018
 Income taxes federal rate $14,111 $36,199 $69,348
 State income taxes federal deduction,372 1,794
 Transition tax. Reform 1,174
 Corporate tax rate changes.
 benefit inverter business,837
 Stock based compensation
 Tax effect foreign operations (13,086)
 Uncertain tax position
 Unremitted earnings 1,624
 Tax credits (6,280
 valuation allowance 7
 Withholding taxes
 permanent items (3
 provision income taxes $10,699 $25,227 $62,090


operating income
 AMER. increased $19. 2 million 2019 net sales positive customer mix increased fixed costs ramps.
 APAC. decreased $5. 7 million negative shift customer mix increased fixed costs net sales.
 EMEA. income increased $3. million net sales costs.
. increased $5. 4 million. due $2. 7 million decrease interest income lower cash balances $1. 5 million increase factoring fees sale programs.
 income
 AMER $57. $38.
 APAC.
 EMEA.
 Corporate other costs.
 Total operating income $142.


Administrative Expenses personnel IT finance legal resources professional services fees.
 stock compensation
 expenses increased 2019 professional services fees
 Ended May 31,
 Percent Change
 $1,093 -1% $1,102
 Stock-based compensation -5%
 Total expenses $1,265 -1% $1,282
 % Total Revenues 3%


table summarizes activity Company unrecognized tax benefits April 1 2016 to March 31, 2019
 accrued interest penalties $88. 1 million $80. 8 million. penalties 2017 were $5. 4 million $5. 8 million. $37. 5 million.
 total unrecognized tax benefits $763. 4 million $436. million March $664. 4 million $436. million impact effective tax rate recognized. unrecognized tax benefits decrease $50. million next 12 months. Positions include. non. matters.
 Beginning balance $436. $398.
.
 settlements tax authorities.
 statute of limitation expirations.
 current tax positions.
 prior year tax positions.
 Ending balance $763. $436. $398.


Restatement changes financial income expenses
 variations SEK exchange rates Company change reporting foreign exchange effect foreign risk. Previously foreign exchange effects reported income expenses.
 note F2 foreign exchange effect presented net amount separately. comparative years 2018 2017
 restated new. restatement impact total net income expenses.
 table shows impact restatement
 Company financial income expenses including foreign exchange effect income statement single line item.
 separate. 2018 2017 restated new
.
 income expenses
 –316
,389
 –2,705 –1,215
 million
 –2,032 –1,570
 Net foreign exchange gains losses –824 405
 -2,705 –1,215


Company adopted IFRS 16 January 1, 2019. prior periods.
 risk management
 market credit liquidity risk. identifies manages.
 policies controls management. approval Board Audit Committee. complies risk policies.
 Financial Assets December 31,
 profit loss $12,084,297 $14,021,473
 11,585,477 14,723,232
 Cash equivalents 83,655,648 95,486,403
 Receivables 24,583,451 26,459,392
 Refundable deposits 2,757,399
 Other assets 2,320,037 2,353,066
 $136,986,309 $155,644,299
 Liabilities December 31,
 Short-term loans $13,103,808 $12,015,206
 Payables 23,559,548 27,433,065
deposits
 Bonds 41,378 38,781,416
 Long loans 30,826,215 33,902,074
 Lease liabilities
 $130,056,645,552


net deferred income tax assets
 2019 full valuation allowance. increased $1. 7 million. tax expense $39,000. benefit $597,000. valuation allowance December 22, 2017 Tax Cuts Jobs Act Tax Reform.
 $0. 8 million tax credit carryforwards $26. 9 million federal net operating loss carryforwards. tax credit carryforwards 2021. 2022. State tax credit net operating loss $0. 1 million $8. 1 million. 2020. 2019 $1. 2 million state net operating loss carryforwards expired.
 Deferred income tax assets
 Allowance doubtful accounts
 Foreign tax credit carryforward
 Deferred revenue
 Accrued compensation
 Inventory reserves
 Net operating loss carryforward
restructuring
 Intangibles goodwill 272
 deferred tax assets 38,771 38,721
 Valuation allowance,103
 deferred assets 1,618
 Intangibles goodwill


. Employee share plans
 Shares issued FY2019 Performance Rights plans
 Sections 200B 200E Corporations Act iSelect shareholders approved benefits Performance Rights Plan future retirement participant benefits not statutory limit.
 Change control
 Board Performance Rights.
 FY2018 Rights Plan
 table shares issued
 2019 2018
 547,949
 Granted 772,303
 Forfeited (140,687 (224,354)
 Exercised
 end 407,262,949


NOTE 4 PREPAID EXPENSES CURRENT PATENTS
 2019 tax refunds Internal Revenue $5. million prepayment 2018.
 December 31,
 thousands
 Prepaid income taxes $5,429
 expenses assets 1,151
 $6,580


director compensation policies non-management directors 2019
 Oleg Khaykin no compensation. compensation Summary Compensation Table.
 amounts grant date values RSUs 2003 Equity Incentive Plan estimated forfeitures. no assurance values non-employee directors. unvested RSUs “Unvested Restricted Stock Units
 DIRECTOR COMPENSATION
 Fees Stock Awards Total
 Keith Barnes 102,500 178,317 280,817
 Richard. Belluzzo 160,000 178,317,317
 Laura Black 67,500
 Tor Braham 67
 Timothy Campos 77,500 178,317 255,817
 Donald Colvin 97,500 275,817
 Masood. Jabbar 268,317


 datacenters offices research retail stores equipment. 1 20 years extend 5 years terminate 1.
 expense
 June 30
 Operating lease $ 1,707 $ 1,585 1,412
 Finance
 Amortization right-use $ 370 243 104
 Interest lease liabilities 247 175
 finance lease cost $617 $418 $172


NOTE 9—PROPERTY PLANT EQUIPMENT
 components
 fiscal 2019 agreements construction leasing two buildings corporate campus San Diego California. financial institution buildings lease five years.
 2019 sold land buildings CTS campus San Diego. lease buyer employees until new buildings 2021. sold land buildings Orlando Florida lease new space. net proceeds $44. 9 million net gains $32. 5 million.
 2015 purchased software designing configuring.
 Costs development capitalized as software costs. outside expensed as incurred. amortized useful life software three to seven years. No amortization expense until software ready use.
 September 30, 2019 incurred costs $138. 9 million purchase development ERP system $3. 1 million $22. 5 million $40. 6 million fiscal years 2019 2018 2017.capitalized $1. 6 million $7. 5 million $16. 7 million 2019 2018 2017. recognized expense $1. 5 million $15. 0 million $23. 9 million. administrative expenses Consolidated Statements Operations.
 components ERP system 2016 2019. costs transferred software-year. costs components.
 provisions depreciation plant equipment amortization leasehold improvements software $22. 6 million $19. 5 million $17. 8 million 2019 2018 2017. straight-line methods property 15 39 years leasehold improvements. accelerated methods machinery equipment software 5 to 10 years.
 Land improvements 7,348 13,132
 Buildings 48,191
 Machinery equipment 107,297
 Software 108,526
 Leasehold improvements 17,064
 Construction software 16,814 12,888
depreciation
 144,969 117,546


Lease liabilities-use balance.
 Extension termination options leases operational flexibility. lease term TORM noncancellable extension options.
 analysis contractual undiscounted cash flow
 Less one 7.
 One to five years.
 More five years.
 undiscounted lease liabilities 31 December 35. 30.
 liabilities 30. 25
 Non-current 10.
 20.


Standard & Poor's Rating Services "BBB. Moody’s Investor Service. "Baa2. Fitch Ratings subsidiary Fimlac. "BBB. table fees unused facility fees borrowings levels S&P Moody's Fitch.
 rating levels split fees two.
 Ratings Level&P/Moody's/Fitch Facility Fee Rate All-in Borrowing Spread
 A-/A3/A- above. 090%.%
 BBB+/Baa1/BBB+. 100%. 125%
. 250%
 BBB-/Baa3/BBB. 175%. 375%
 BB+/Ba1/BB+ lower. 225%. 625%


MAJOR CUSTOMERS VENDORS
 3 customers 10% December 31, 2019 percentages 17. 8% 15. 4% 13. 3%.
 four partners 10% revenue 2019 2018. amounts revenue.
 1,315,706.,386.
 9,210,347 37. 5,350,393 25.
 4,051,217 16. 2,584,103 12.
 1,007,573. 2,159,356.


. Financial risk factors
 Market
 Foreign exchange risk
 31 December 2019 major monetary assets liabilities foreign exchange risk
 2019 reported exchange gains RMB77 million (2018 RMB229 million income statement.
 changes foreign exchange rates results assets liabilities exchange rate peg HKD USD. no analysis foreign exchange risk.
 USD denominated RMB’Million Non-USD denominated RMB’Million
 31 December 2019
 assets 27,728 2,899
 (4,273) (14,732)
 23,737 (17,572
 31 December 2018
 18,041 1,994
 (3,434)
 (3,733)


. PROPERTY EQUIPMENT
 classification estimated
 Excludes assets sale
 Lesser lease term useful life
 change property accrued liabilities $14,315 $15,674 2019 2018. excluded capital expenditures.
 No impairments property recorded 2019 2018.
 received offer purchase Houston, TX facility. assets value $5,055. sale 2020 likely expects gain full appraisal value. assets held sale. Elizabethtown, KY facility. sell $1,300 closing second quarter 2020. impairment loss 2017 Note 2. assets sale 2019 2018 $6,355 $1,300 included balance. not included table.
 Estimated Useful Life
 Land $23,243 $24,845
 Land improvements 25,209 5 - 20 years
 Buildings 147,220 143,918 20 - 30 years
48,478 5 30
 365,101 328,864 3 10
 39,293 4 10
 12
,955,703
 depreciation,481 364,153
 $272,474 $285,550


ADVANCED INDUSTRIES. FINANCIAL STATEMENTS share
.
 valued first-in.
 Parts raw materials $134,816 $76,647
 Work process 10,269 6,644
 Finished goods 84,934 14,696
 $230,019 $97,987


financial position ASMPT equity adjustments exchange rate December 31, 2019 HK$. 11432. 11151).
 Equity ASMPT euros. 11432 €1,329 million. 19% share €335 million.
 ASMPT Board Back-end activities. results ASMPT Audit Committee representative. reports Management Board Audit Committee quarterly.
 income taxes not included financial statements.
 million
 assets 15,168 13,381
 Non-current 7
 7 1,122
 Equity 12,161 11,632


roll forward accrued restructuring charges fiscal 2019 2018
 restructuring exit costs $47. 8 million long-term liabilities Company consolidated balance sheets March 31, 2019.
 Restructuring Non-Restructuring
 Employee Separation Costs Exit Costs
 Balance March 31, 2017 $5. $34. $40.
. 20 21.
.
 Non-cash.
 Changes foreign exchange rates.
 March 31, 2018. 27. 19. 47.
 Additions Microsemi acquisition 10. 19.
 48. 44
.
 Non-cash.
 Changes foreign exchange rates.
 March 31, 2019 $12. $19. $15. $47.
 $26.
 Non-current 20.
 $47.


table summarizes fair value Level 3 liabilities unobservable inputs
 money market accounts cash balance sheets. assets valued quoted prices active markets.
 liability subsidiary unit awards agreements cash awards financial milestones revenue EBITDA. account fair value liabilities future payment repurchase revenue EBITDA. fair value Monte Carlo simulation model. calculated outcomes averaged discounted present value. remeasure liabilities revenue receivables unobservable inputs changes employee compensation expense. awards subject employment recorded straight-line. December 31, 2019 settled $0. 2 million liability subsidiary unit awards. remaining liability balances accounts payable accrued expenses consolidated balance sheets.
 contingent consideration liability potential earn-out payment 85% OpenEye October 21, 2019.earn-out payment contingent on 2020 revenue targets maximum potential $11. 0 million. fair value liability future payment revenue 2020. estimated value Monte Carlo simulation model. liability valued with Level 3 inputs revenue volatility discount rate. October 21, 2019 fair value $2. 8 million. until 2021 liability. Changes value recorded in statements. December 31, 2019 liability decreased $0. 2 million to $2. 6 million due OpenEye's 2020 revenue. inputs revenue volatility 45% discount rate 3%. revenue volatility discount value.
 included in liabilities balance sheet.
 market data classification financial instruments. economic conditions transfer instruments. reported. no transfers between Levels 1 2 3 December 31, 2019 2018 2017. monitor value investments-temporary impairment quarterly.impairments 2019 2018 2017.
 Fair Value Measurements Inputs
 Ended 2019 2018
 Unit Liability Acquisitions
 Beginning period balance $3,160
 Acquired liabilities
 Changes fair value earnings
 Settlements
 End period balance $171 $2,595 $385


 common stock traded Nasdaq Capital Market. limited market securities. no assurance regular trading market. shareholder resell securities.
 tables high low bid stock. inter-dealer prices without retail mark-up commission not represent transactions.
 March 24, 2020 last sales price share $7.
 Fiscal Year Ending December 31, 2018
 Quarter Ended
 March 31,.
.
.
.


Employee Costs
 wages salaries $4. $4 retention payments business combinations.
-ended 31 March 2019
 Wages salaries 286. 271.
 Social security 25.
 Pension 8.
.
. 319.
 Share-based payments 36. 42.
 370. 361


 December 31, 2019 Company 11 vessels bareboat. second 2019 commenced charter Overseas Key West 10 years. accounted finance lease. remaining 10 vessels operating leases.
 right-of-use reported vessels property less depreciation balance. holds options 10 vessels one three five years one-year option once three- five-year options indefinitely.
 lease payments fixed options vessel-by-vessel exercised individually. June 2025. December 10, 2018 nine vessels.
 five extended three years December 2022 four December 2020. December 2019 extended three years December 2023.
 Five vessels deferred payment obligation hire expense payable. due quarterly installments final payment lease termination.
 future minimum commitments
bareboat charters variable lease payments profit owners calculated agreements sublease revenue. reflected table. reserve funding no profits expected paid next year.
 December 31, 2019 lease expense 10 vessels $90,359 included. recognized sublease income $188,163.
 non-cash operating activities $93,407 right-use assets liabilities lease renewals.
 lease expense finance lease $2,052 amortization $1,462 interest lease liability. included cash flows. non-cash financing activities $28,993 finance right-of-use assets.
 2018 lease expense $91,350 included charter hire expense.
 December 31, 2019 Leases Finance Lease
 2020 $92,404 $4,172
 2021 91,164
 2022 107,654
 2023
 2024 9,168
4,534
 347,939 38,007
 40,891,448
 $307,048


NOTE 10—GOODWILL ASSETS
 Changes goodwill two years September 30, 2019
 CMS separate segment October 1, 2017. reassigned goodwill CGD CMS October 1, 2017.
 July 2017 acquired Deltenna wireless radio antenna communication. operations CGD. April 1, 2019 reorganized reporting Deltenna CMS reassigned $3. 4 million goodwill CGD CMS value. sales results cash flows significant consolidated results. reportable segment information restated.
 annual goodwill impairment test July 1 CTS CGD CMS units.
 two-step. fair value carrying amount. impairment. impairment recorded period.
 2019 estimated fair value three units exceeded carrying amounts. no impairment goodwill 2019.
 management judgment future operating results. estimates consistent plans.assumptions sales interim analyses 2020 impairment charges.
 Transportation Systems Mission Solutions Global Defense
 balances September 30 2017 $ 50,870 270,692 321,562
 Reassignment October 1 2017 125,321
 Acquisitions 13,085
 Foreign currency rate changes
 Net balances September 30, 2018 49,786 138,127
 Reassignment April 1, 2019
 Acquisitions 206,988
 currency exchange rate changes
 Net balances September 30, 2019 $ 254,592 181,424 578,097


. Net Income Share Operations
 table basic diluted net income share millions
 computed income. diluted potentially dilutive shares.
 dilutive common shares equity incentive plans determined treasury stock method stock options RSUs. shares exclude option shares dilutive. no anti-dilutive option shares years March 31, 2019 2018 2017.
 Net income operations $355. $255. $170.
 weighted average common shares 236. 232. 217.
 Dilutive effect stock options RSUs.
 2007 Junior Convertible Debt.
 2015 Senior Convertible Debt.
 2017 Debt weighted average common shares 249. 248. 234.
 Basic net income per common share $1. $1.
 Diluted income $1.42 $1.


 recognized cost
 small portion capitalized. straight-line attribution.
 Ended December 31,
 cost
 Common stock warrants $512 $484
 Stock options 16,489 13,279 11
 Restricted stock units 14,585
 Employee stock purchase plan 3,326 2,069
 cost $34,400 $15,950 $11,779


Financial Operating Highlights
 non-GAAP Form 10-K.
 Bookings $1,002,320 $2,779,782 $1,234,013
 Backlog $3,400,952 $4,064,451 $2,536,499
 Sales $1,496,475 $1,202,898 $1,107,709
 growth 24%
 Research development $50,132 $52,398
 Operating income $86,237 $24,382 $2,628
 Net income.
 EBITDA $146,594 $104,561
 earnings share.
 43%
 dividend.
 Long-term debt $199,824 $199,793


2019
 revenues $36. million decrease $75. 68% versus 2018. driven $70. million decrease fixed fee license revenue $4. million decrease per-unit royalty revenue.
 net loss $20. million $54. million 2018. $74. million decrease related $75. million decrease revenue offset $0. 5 million decrease cost operating expenses.
 adopted ASC 606 January 1 2018. unchanged. change revenues 2018 2019 accounting policy change ASC 606.
 table consolidated statements income revenues
 Revenues
 Fixed fee license revenue 35. 75. 36.
 Per-unit royalty revenue 64.
 royalty license revenue.
.
.
 Costs expenses
.
 Sales marketing.
 Research development.
 administrative.
Restructuring costs 4. 6
 expenses 159. 52. 8
 Operating income. 6) 47. 8)
 Interest income 5. 7
.
 Income taxes. 4) 49. 9)
 Provision taxes.
 Net income (loss. 48. 9


balance sheet accounting assumptions
 smaller overseas schemes discount rate 1. 50%. 80% future pension increases. 30%. 45%.
 30 March 2019 31 March 2018 discount rate bond yield curve bonds rated AA AAA.
 Premier
 Discount rate 2. 45% 2. 70%.
 Inflation RPI 3. 25%.
 Inflation CPI.
 Expected salary increases
 Future pension increases 2. 10%.


. Marketable Securities
 cost gains losses market value securities April 30 2019 2018
 April 30 2019
 Gains Losses Market Value
 $8,152 $8,199
 April 30, 2018
 Gains Losses Market Value
 $6,274 $6,149


 Company adopted ASC 606 January 1, 2018 modified retrospective method. recognized effect ASC 606 adjustment opening balance retained earnings. comparative prior period information accounted ASC 605 not restated. ASC 606 recognizes revenue transfer control to customers. five step approach contract performance obligations determine transaction price allocate recognize revenue.
 Revenue product sales recognized control transfers customers shipped delivered location. shipping handling activities after transfer control. fulfillment activities costs accrued revenue recognized. Taxes excluded from revenue.
 opening closing balances accounts receivable deferred revenue
 revenue recognized approximately$5. 1 million year ended December 31, 2019. increases deferred revenue related to billings payments customers obligations decreases revenue recognized.Deferred revenue one year long-term balance.
 receives orders. invoices recognizes revenues. scheduled delivery dates within one year optional exemption revenues partially completed contracts one year less not disclosed. December 31, 2019 no contracts unsatisfied more one year.
 Balance Beginning
 End Period
 December 31, 2019
 Accounts receivable $90,831 $7,117 $97,948
 Deferred revenue $5,101 $(618) $4,483
-current $3,707


Stock-based Compensation Expense
 expense stock options RSUs ESPP statements
 2019 2018 2017 capitalized compensation cost $0. 5 million $0. 1 million $0. 3 million projects.
 December 31, 2019 $60. 3 million unrecognized stock compensation expense $13. 9 million stock options ESPP $46. 4 million RSUs. amortized 2. 87 years. RSUs. 69 years.
 revenues 2,193 2,315
 Sales marketing 6,812
 Research development
 General administrative 18,328
 stock-based compensation expense 32,137


Interest Cost
 coupon issuance contracts Senior Notes convertible notes term loan agreement commercial paper revolving credit 2017.
 interest expense $2. 5 billion Senior Notes March.
 2019 24 2018 25 2017
 Contractual interest coupon $100,712 $77,091 $95,195
 Amortization discount 3,937
 issuance costs 1,426
 interest contracts 4,086
 interest cost $110,161 $91,353 $115,726


Employee Share Purchase Plan
 Company estimates options Black-Scholes option-pricing model. term offering period six months.
 risk-free interest rate treasury instrument. volatility historical volatility. dividend rate zero dividends.
 grant date value share closing market value first period. first offering period commenced July 1, 2017.
 value estimated Black-Scholes option-pricing model-average
 per share value 2019 2018 $9. 58 $6. 41.
 Expected term.
 Risk-free interest rate. 3%.
 Expected volatility.
 dividend yield%
 Grant date fair value per ordinary share $36. $27.


. Income Taxes
 December 22, 2017 Tax Cuts and Jobs Act enacted law. tax law changes reduction. federal corporate income tax rate 35. 0% to 21. 0% one-time transition tax foreign subsidiaries new taxes foreign-sourced earnings.
 Accounting Standards Codification Income Taxes tax law changes. SEC staff issued Accounting Bulletin 118 provisional amounts. Company recorded reasonable estimate adjustments 118. no provisional amounts recorded. December 31, 2018 provisional amounts adjustments amounts final SAB 118.
 March 31, 2018 remeasured deferred tax assets liabilities provisional income tax benefit $136. 7 million. adjustments
-time transition tax based post-1986 earnings profits. recorded provisional amount transition tax foreign expense $644. 7 million March 31, 2018.regulations. Treasury Internal Revenue Service Company finalized calculations transition tax expense December 31, 2018. increased March 31, 2018 provisional amount $13. million $657. 8 million income tax expense. adjustment. decreased diluted income share $0. $0 05 year March 31, 2019.
 invest foreign subsidiary earnings capital subsidiaries. jurisdictions additional costs repatriation. estimate additional tax reinvested earnings repatriated.
 March
 Pretax (loss) income
. $(593.(127.(279.
. 864 369
 $204. $737. $89.
 Current expense
.(98 $369. $21.
.
.
 expense $(89. $430. $46.
 Deferred expense
. $11. $82.(114.
.. (5.
. 7) (31. (6.
 deferred. 51.
 Income tax (benefit(151. $481.(80.


 Long-term debt
 Maturities five years September 30 2024 2020 $10. 7 million 2021 $35. 7 million 2022 $35. 7 million 2023 $35. 7 million 2024 $35. 7 million.
 March 2013, issued $100. million notes 3. 35% maturing March 12, 2025. July 17, 2015, additional $25. million 3. 70% March 12 2025. Interest semi-annually principal 2021 2025. February 2 2016 revised issued additional $75. million 3. 93% maturing March 12, 2026. Interest semi-annually 2020 2026.
 coupon rate. 50% leverage ratio.
 September 30 Series A notes interest. 35%
 Series B. 35%
 Series C. 70%
 Series D. 93%
200,000
 unamortized debt
 $189,111 $199,793


Share-Based Awards
 2005 Plan. 5 shares deducted balance. performance maximum awards.
 Years Ended July 27, 2019 July 28, 2018 29, 2017
 Balance fiscal year 245  272  242
 Restricted stock awards granted (67) (70) (76)
 awards canceled/forfeited 18
 Shares withheld taxes not issued 23
 end fiscal year 220 245 272


Alternative performance measures
 Return capital employed
 management fixed assets working capital profitability. calculated adjusted operating profit divided average capital. information Capital Employed ROCE Financial Review page 57.
 analysis components
 Property plant equipment 251. 230.
 Right-of-use assets 16 40.
 Prepayments.
 Inventories 185. 160.
 receivables 240. 245.
 current assets 35. 32
 Tax recoverable 8.
 payables provisions (178.
 tax payable (26. (23
. 484
 521. 482.
 501. 482.
 profit 245. 299.
 160.
 282.
 281.
 Return 54.
.


accelerated vesting 48,849 stock options. Dooley’s agreements January 17,
. employment terminated six months
 vested stock options.
 exercisable less than 90 days after termination.
 accelerated vesting 15,000 unvested restricted stock units. agreement
 March 1 “change non units accelerate vested
. employment terminated
 date termination
 accelerated vesting 7,500 unvested restricted stock units.
. death disability 7,500 units (50%
 December 31, 2018) vest.
 accelerated vesting 10,630 unvested performance restricted stock units.
. employment terminated six
 months. death disability all non-vested units
 accelerate vested date termination.
Payment Termination Systemax Resignation$ Termination Death Disability$ Change Control$ Termination Control$
 Cash Compensation Non-Equity Incentive Compensation
 Accelerated Vesting Stock Option Awards 505,100
 Vesting Restricted Stock Unit Awards 377,400 188,700
 Vesting Performance Restricted Stock Unit Awards 267,500 (4)
 Medical Other Benefits
 Total 377,400 456,200 772,600


14 LIABILITIES
 carrying amount fair value short-term receivables. note 21 fair value.
 Partners commercial managements.
 operating expenses 14.
 interest.
 Wages social expenses. 16
 financial instruments 12.
 joint ventures.
.
 Balance 31 December 47. 36.


Cash Flows
 flows
 Ended December 31,
 operating $47,112 $60,710 $57,187
 investing (73,414) (13,377 (168,795)
 financing 2,399 67,303


income tax expense federal rate (21% 2019. 27% 2018 35% 2017)
 July 2015, U. S. Tax Court Altera litigation IRS. stock-based compensation expense foreign subsidiary. accepted compensation. June 2019 Ninth Circuit reversed 2015 decision. Altera petitioned rehearing. impact 2020 Consolidated Financial Statements. estimated impact $75 million decrease deferred tax assets increase tax expense.
 2014 2017 tax ruling Switzerland. decreased taxes $6. 3 million 2017. benefit diluted earnings per share $0. 03 2017. 2018 withdrawn reduced tax rate ruling Switzerland Swiss.
 Earnings foreign subsidiaries $458. 4 million June 30, 2019. States subject foreign withholding taxes $73. 1 million current rates.

 30 2019 24 25 2017
 tax $513,780 $891,011 $634,086
 (17,565
 Foreign income,344
 Settlements tax (31,291),367
 Tax credits (71,779),301
 State valuation tax 26,742 57,302
 Equity compensation (35,875)
 differences 39,251 43,214
. tax reform 63,913
 $255,141 $771,108 $113,910


Segmental reporting
 Capital additions depreciation amortisation impairment
 property plant equipment £59. £33. £8. 1m. acquisitions intangible assets £72. £19. £60. 2m £9. intangibles. Right-of-use asset additions £48. 9m December 2019 £36. 1m additions 1st January IFRS 16 £11. 7m new leases £1. 1m acquisitions. additions UK world £36. 8m £20. world £143. 1m £32. 4m.
 additions Depreciation amortisation
 Specialties 57.
 Electric Thermal Solutions.
 Watson-Marlow.
 179.


. Income Taxes
 differed federal rate 2019 2018
 income tax benefit 2019 $20. 6 million. driven by net valuation allowance $37. 4 million Insurance offset impairment goodwill not deductible. Insurance segment profitable 2019 three-year cumulative income.
 profitability driven by current income favorable claims reserve development. unrealized gains investment portfolio 2019.
 2018 state filings. Insurance segment acquired Kanawha Insurance Company. net loss tax deductions reserves. bargain purchase gain not taxable. allowance. income tax expense sale BeneVir 2018 offset tax attributes valuation. no net tax expense.
 Years Ended December
 Tax provision federal statutory rate.
 Permanent differences.
 federal benefit.
 Foreign rate differential.
 interest.
 compensation.3.
 Increase valuation allowance (7.
 Transaction costs.
 Tax credits.
 Return provision. 15.
 2017-11.
 Goodwill impairment.
 Gain sale deconsolidation subsidiary.
 purchase gain (24.
.
 liability.
 Income tax expense.


. VESSELS
 23 vessels December 2019 2018. drydocking costs.
 Depreciation calculated cost less residual value $8. 0 million per vessel useful life. useful life 25 years.
 charges $497. 0 million 2018 excluded
 Impairment charges $2. 2 million $110. 5 million excluded
 three vessels maintenance 2019 two drydock 2019.
 Impairment Loss
 loss 2019. loss $2. 2 million $110. 5 million 2018 2017.
 reviewed assets impairment. compared undiscounted cash flows carrying value. cash flows exceeded carrying value no impairment recorded.
 historical trends future expectations. estimated freight rates. volatile market rates historical rates.
 figures USD
 Vessels January 1 1,307,087 1,769,967
2,531 169,446
 January 1 52,331 119,303
 8,210
,182)
 1,369,567 1,359,418
 Depreciation (469,570)
 Impairment Loss
 899,997 953,758


. Revenue Contracts
 Adopting Topic 606
 effects Financial Statements year 2019
 Adjustments Topic 606
 Net sales $3,164,434 $14,880 $3,149,554
 Cost 2,872,596
 Gross profit 291,838
 Operating income 142,055
 Income taxes 125,955
 expense 17,339
 Net income $108,616 $1,506 $107


Base Salary
 officers fixed compensation program. services experience skills knowledge. no formula adjustments. economic condition future performance. conservative competitive market pay.
 April 2018 compensation committee reviewed salaries. Friar Henry Reses Whiteley market analysis recommendations. approved annual base salary. Friar Henry Reses Whiteley to $400,000 April 1, 2018 competitive alignment. CEO’s 2018 base salary $2. 75 per year.
 annualized base salaries December 31, 2018 2017
. Friar resigned Chief Financial Officer November 16, 2018 annual base salary $400,000.
. Whiteley General Counsel Corporate Secretary March 18, 2018 salary adjusted promotion.
 salaries. Daswani Murphy not adjusted co-CFOs. Salary adjustments. April 2018 company-wide compensation review program. recommended approved People Lead.Daswani salaries co-CFOs $300,000 $295,000.
 Salary 2017 2018 Percentage Increase
. Dorsey $2.
. Friar $350,000
. Henry $350,000 $400
.
. Whiteley $325,000
. Daswani $280,000 $300,000 7%
. Murphy $270,000 $295,000


 table shows new orders 2019 backlog
 backlog includes accepted one year. subject cancellation rescheduling. price negotiations. backlog not indicative sales.
 new bookings increased 24% 2019 €1,170 million excluding settlements. book-to-bill 1. 0. Equipment bookings led foundry segment logic memory. Bookings strengthened €235 million first to €270 million second €292 million third €373 million fourth quarter. record high order backlog €351 million increase 16% 2018.
 December
 Backlog 176. 301. 71%
 New orders 942. 1,328. 41%
 Revenue (818. (1,283. 57%
 FX-effect 6.
.
 Backlog reporting date 301. 351. 16%
 Book-to-bill ratio 1.


importance spend on pay
 table shows spend employees distributions shareholders. average number included. Revenue Operating profit key measures Group performance.
 2018 comparatives restated IFRS 9 15 16 share buybacks.
 Employee costs 7 56. 54.
 Average 6 802
 Revenue 355. 330. 8%
 Operating profit 243. 221. 10%
 Dividends share buybacks 26 27 156. 152.


Revenue costs attributed segments. integrated structure costs benefit. Revenue contracts allocated value. allocated relative methodology. Operating expenses marketing margin.
 costs segments allocated. legal information technology human resources finance excise taxes field selling shared facilities customer service. allocation measured. corporate-level activity not allocated restructuring expenses.
 revenue income
 loss restructuring expenses.
 Revenue
 Productivity Business Processes $ 41,160 $ 35,865 29,870
 Intelligent Cloud 38,985 32,219 27,407
 Personal Computing 45,698 42,276 39,294
 $ 125,843 $ 110,360 96,571
 Operating Income
 Productivity Business Processes $ 16,219 12,924 11,389
 Intelligent Cloud 13,920 11,524 9,127
12,820 10,610 8
 42,959 35,058 29,025


Liquidity Capital Resources
 fund operations through cash. December 31, 2019 cash equivalents $36. 6 million marketable securities $434. 8 million accounts receivable $97. 9 million.
 existing cash balances cash flow future operations working capital expenditure needs next 12 months foreseeable future. future capital requirements may vary depend revenue growth research development purchases equipment expansion sales marketing product introductions market acceptance economic conditions. liquidity insufficient may seek additional equity debt financing. additional financing required may. existing cash balances cash flow future operations sufficient working capital expenditure needs next 12 months foreseeable future. future capital requirements vary depend on revenue growth research expansion sales marketing product introductions market acceptance economic conditions. liquidity insufficient may seek additional equity debt financing.additional financing. existing cash balances flow sufficient working capital expenditure needs next 12 months future. future capital requirements vary depend revenue growth research development equipment expansion sales marketing inventory product introductions market acceptance economic conditions. liquidity insufficient seek additional equity debt financing. additional financing.
 April 30, 2018 Board authorized stock repurchase program $60. 0 million common stock $39. 7 million 2018 expiration December 31, 2018.
 December
 Cash equivalents $36,617 $60,444 $67,495
 Marketable securities 434,761 339,424 297,115
 Working capital 368,912 370,445 361,621
 Net cash operating activities 72,819 83,085 61,893
 investing activities (103,579) (56,237) (207,907)
financing 6,933,899 5,477


 operating investing financing Statement Cash Flows 71 summarized table. Global Financing.
 decreased $477 million 2019 income tax $346 million interest debt $300 million acquisition Red Hat Performance declines businesses divested $836 million financing receivables.
 investing increased $22,023 million increase $32,491 million Red Hat $7,223 million non-operating OEM financing decrease capital expenditures $1,346 million increase divestitures $1,076 million.
 Financing $9,042 million 2019 $10,469 million 2018. year-to-year increase cash $19,512 million increase debt transactions $16,584 million Red Hat acquisition decrease common share repurchases $3,082 million.
 December 31
 $14,770 $15,247
 Investing (26,936)
Financing 9,042 (10,469
 exchange rate (167) (495)
 Net change,290


defined benefit pension plan utilizes investment securities. exposed to interest rate credit market. affect amounts reported.
 table target allocation pension plan assets at June 30 2019 June 2018:
 Fixed income 40%
 Equities 55%
 Other 5%
 Total 100%


. ACCRUED EXPENSES PAYABLES
 management bonuses vacation days wage tax social securities pension premiums. Deferred revenue undelivered. VAT taxes invoices goods services.
 Personnel items 32,636 45,318
 Deferred revenue 28,255,146
 Financing
 lease liabilities 7,002
 Advanced payments 25,382 47,601
 Supplier 1,828
 Marketing 1,049
 R&D projects
 accrued expenses 98,993 149,843


Debt
 $13. 3 million March 31, 2018.
 $8. 7 million March 31, 2019.
 $2. 1 million March.
 discounts $0. 6 million. 5 million March 31, 2019 2018.
 Term Loan Credit Agreement $318,782
 Term Loan Facility 276,808
 Customer Advances 11,270
 debt 294,471
 maturities (28
 long-term debt $266,041 $304,083


 International Business Machines
. billion 2019 $2. billion 2018. tax reform.
 46 net income operating earnings.
 Revenue $ 77,147 79,591
 Net Income 9,431
 operations
 $ 11,436 12,657
 share common
.
.
.
 Net cash $ 14,770 15,247
 Capital expenditures 2,370 3,716
 Share repurchases 4,443
 dividends common stock 5,707
 share.
 Cash securities $ 9,009 12,222
 assets $152,186 $123,382
 Working capital 10
 debt $ 62,899 $ 45,812
 equity $ 20,985 16,929
 Common shares
 price share $.


 Consolidated Statements 2019 2018 2017
 Ended March 31,
 Contractual interest expense $19,471 $30,323 $38,825
 Capitalized interest (232)
 issuance costs
 discount 1,481 1,843
 acquisition obligations 57
 capital leases 128
 interest $21,239 $32,882 $39,755


Property Equipment
 cost. summary September 30 2019 2018
 Depreciation amortization straight-line three ten
 years. Leasehold improvements amortized lease. Depreciation $1. 4 million. 6 million. 3 million 2019 2018 2017. repairs maintenance operations. expenses. 1 million. million. 2 million.
 cost
 Leasehold improvements $3,575 $3,825
 Equipment
 software
 Furniture fixtures
 accumulated depreciation amortization (3,999)
 Total property equipment $4,231 $4,665


FINANCIAL STATEMENTS
 Stock-Based Compensation
 December 31, 2019 five plans Non-Employee Directors' Stock Retirement Plan
 2004 Omnibus Long-Term Incentive Plan Equity Performance
 2018 Equity Incentive
. Future grants 2018 Plan.
 stock options appreciation rights restricted stock units
 shares units awards.
 table compensation
 fair value equity awards 2019 2018 2017 $6,589 $5,805 $5,471. tax deduction $1,489.
 Service-Based RSUs $2,207 $2,036 $1,762
 Performance-Based RSUs 2,553
 Cash-settled awards 255
 $5,015,256 $4,184
 Income tax benefit
 $3,882 $4,068


Consolidated Financial Statements
 Leases
 Company leases corporate manufacturing facilities real estate developers. leases expire 2034 renewal options ten-year periods. include market rent escalations holidays leasehold improvement incentives. improvements amortized remaining. leases machinery office equipment non leases. remaining terms to 15 years.
 Rent expense $19. 3 million $16. 3 million $14. 8 million 2019 2018 2017.
 Capital Leases
 capital lease facility Beijing China manufacturing space. 2021 not recorded Consolidated Balance Sheet March 30, 2019. five years renewal options maximum 30 years. minimum future payments.
 Purchase
 materials manufacturing services. property equipment due next 12 months.
 minimum payments-cancelable leases March 30, 2019
Operating Capital Purchase Commitments
 2020 $22,207 $328,435
 2021 13,382
 2023
 7,139
 31,598 47,258
 payments $92,881 $52,379 $361,690


Option Exercises Stock Vested Fiscal 2019
 table options vesting 2019
 realized excess market price.
 market price Shares.
 vesting PSUs RSUs Fiscal 2018 LTIP.
 Option Awards Stock Awards
 Shares Acquired Value Realized
 Mark J. Barrenechea 135,208 $2,801,023 $7,625,905
 Madhu Ranganathan
 Muhi Majzoub $2,592,411 $1,263,646
 Gordon A. Davies $1,486,870
 Simon Harrison $714,495 $346,808


Sales-Type Leases
 We lessor in network equipment five years. or bargain. residual value guarantees restrictive covenants. allocation between lease nonlease determined by selling price. net investment in lease receivables less unearned income. Collectability evaluated. taxes leases. allowance for credit losses net investment. investment
 Included in receivables.
 assets.
 Current minimum lease payments receivable(1) $1,201 $11,339
 Non-current 889 1,670
 Total 2,090 13,009
 Current unearned revenue(1) 365 631
 Non-current unearned revenue(2) 163 473
 Net investment in sales-type leases $1,562 $11,905


table currency
 revenue growth declined 7% 2019 from 12% 2018. growth new customers agreements foreign currency movements alliance arrangements expansion emerging markets. decline driven one-time services recurring revenue cash.
 December 31,
 Revenue $576,523 $537,891 $481,985
 Foreign exchange effect revenue 7,077
 Constant currency revenue $583,600 $532,600 $487,850
 Revenue growth 7. 2% 11. 6%. 9%
 currency growth 8. 5%.


. FINANCIAL INSTRUMENTS.
 long financial assets fair value profit loss calculated level 2. balances calculated level 1. calculated level 2. balances level 1.
 Indebtedness excludes deferred financing costs prepayment options. excludes deferred financing costs options.
 Trade receivables payables approximate fair value short-term maturity.
 December 31, 2018 Amortised cost Fair Value
 Cash equivalents $ $768,433 1
 Trade receivables 45,631
 Other current financial assets 18,632  18,779
 long-term financial assets 33,796  21,959  55,755
 Trade payables (30,659)
 current financial liabilities (26,380),131 Level 2
long-term liabilities,894) (54,521)
 Indebtedness,853,883),695
 $46,795,123,646,076,851),935,620)


net deferred income tax assets September 28, 2019 29, 2018
 2019 valuation allowance increased $0. 8 million. AMER $1. 7 million EMEA $0. 9 million.
 September 2019 $189. 2 million pre state net operating loss carryforwards 2020 2040. full valuation allowance. $79. 6 million pre-tax foreign net operating loss carryforwards 2019 2025. full.
 2019 regulations issued tax legislation adopted jurisdictions. impacts financial condition cash flows.
 granted tax holiday foreign subsidiary APAC. 31, 2024 subject conditions. 2019 tax reductions $23. 9 million Tax Reform. $39. million. $37. 5 million.
 taxes undistributed earnings foreign subsidiaries. deferred tax liability $10. 5 million September 28, 2019.
Company $2. 3 million uncertain tax benefits September 28, 2019. liabilities $1. 5 million income taxes $0. 8 million. payment.
 income tax assets
 Loss carryforwards $28,391 $27,915
 Inventories 16,809
 Accrued benefits 15,834
 3
 deferred tax assets 64,387 52,283
 valuation allowances (29,170
 assets 35,217
 Property plant equipment 15,621
 unremitted earnings 5,192
 Acceleration 606
 26,868
 8,349


revenue $8,034 million decreased 2. percent to adjusted IBM Z performance 2017 price pressures Storage Systems.
 hardware platforms down year year. offset growth Power Systems POWER9 systems Linux. cloud revenue $3. 1 billion decreased 10 percent IBM Z product cycle dynamics.
 year December 31 2018.
 Systems revenue $8,034 $8,194 (2.
 Systems Hardware $6,363 $6,494.
 IBM Z.
 Power Systems.
 Storage Systems.
 Operating Systems Software 1,671 1,701.


Property Equipment
 Depreciation $22,538,000 $21,721,000 $25,787,000 2019 2018 2017.
 November 1 2019 real estate Chandler Arizona $48,000,000 headquarters. building infrastructure. properties Tempe Arizona.
 $12,138,000 $27,658,000 $11,700,000. Depreciation.
 Software $114,674 $170,327
 Buildings 92,092 64,263
 Equipment 60,661 100
 Furniture fixtures 34,768
 33,668
 Land 31,374
 Accumulated depreciation amortization (236,330 (331,700
 $130,907 $72,954


. VENTURES
.
 equity interest.
 adjustments local accounting standards SFRS.
 Airtel Telkomsel
 Statement financial position
 assets 4,378. 3,546. 1,481. 1,368.
 Non-current 45,611. 6,169. 5,548. 10,027.
 (13,568. (2,547.,344.,994.
 Non-current liabilities,676. (2,909.
 15,744. 6,281. 1,775. 1,584.
 Non-controlling interests (1,399.
 assets equity holders 14,345. 6,281. 1,776. 1,579.
 ownership 36. 35
 share assets 5,230. 2,198. 837. 368
 1,229. 1,403. 293.
 387.
investment 6,847. 3,602. 1,079. 659.
 348. 2,371. 229. 522.
 liabilities (19,774. (570. (2,658. (3,690.
 (3,884. (76. (187.
 market value 10,995. 3,544. 5,013.


Administrative Expense
 increased $15. 4 million 2019 2018. due $9. 8 million employee costs stock-based compensation headcount 89 113. increase $3. 7 million depreciation amortization. million compliance. 6 million office expenses $0. 2 million software subscription costs.
 Ended December 31,
 $ 46,820 $ 31,462 15,358.
 revenue


table contractual maturities debt investments April 26, 2019
 differ borrowers call prepay obligations.
 one year $ 591 589
 five 642
 ten 455
 $ 1,690 1,683


SHARE BASED COMPENSATION PLANS
 compensation cost shares equity
 1,305,399 options granted Share Plan 2015 2019 average exercise price $14. 86 per share grant date fair value $2. 6 per share.
 Restricted plans. 211,567 units/options value $10. 48 per share. $10. 48 per share.
 1,400,000 shares granted management personnel fair value $10. 08 per share.
 Joint Stock Ownership Plan
 2012, Eros International Plc Employee Benefit Trust. purchased 2,000,164 shares borrowed repayable demand. Board recommends shares nominal price. shares held Plan. shares equity ‘JSOP reserves’.
 Year March 31
 IPO India Plan $1,198 $1,572 $2,140
JSOP 3,622
 2012
 2014 1,427
 2015
 5,346 7,283
 grant 11,911 8,173 10,850
 $21,561 $23,471


. Employee Benefits
 Salaries 10,031 9,025 8,693
 Social security 1,477 1,339 1,281
 Share-based 1,835
 Pension
 Employee restructuring 1,111
 47
 Employee 14,870 11,595 11,643


. taxes
 property motor excise transaction income statement
 million 2017/2018 2018/2019
 79
 cost sales
 selling expenses (65)
 administrative expenses (13)


. SEPARATELY DISCLOSED
 Group disclosed EBITDA1 profit after tax trading results transactions not regular business activities. results comparison. 'separately disclosed Financial Report.
 Transaction costs acquisition Sigma Systems
 $2,063,000 Sigma Systems. vendor due diligence legal administrative matters travel costs management. included 'Travel Expenses 'Other Expenses consolidated statement income.
 details acquisition Note 24.
 costs $677,000 acquisition Enoro Holdings Hansen Technologies Holdings subsidiaries. included 'Other Expenses consolidated statement.
 lease provision
 provision future lease payments benefits. separately identified costs not normal business activities. included 'Property Operating Rental Expenses.
 Restructuring costs Sigma Systems
 $72,000 restructuring costs redundancy payments post-acquisition.costs Benefit Expenses income.
 Decrease profit before tax
 Transaction costs Sigma Systems Enoro (2,063) (677
 lease provision
 Restructuring costs Sigma Systems
 disclosed items (2,794) (677


deferred tax assets liabilities
 provide taxes undistributed earnings foreign subsidiaries. taxes differences reinvested outside. May 31, 2019 differences. approximately $7. 9 billion. If differences recognized generate foreign tax credits reduce federal tax liability. May 31, 2019 potential net deferred tax liability approximately $1. 5 billion.
 net deferred tax assets $2. 4 billion $1. 3 billion May 31, 2019 2018. realization taxable income reversal differences loss tax credit. subject adjustment taxable income change.
 valuation allowance $1. 3 billion May 31, 2019 2018. tax assets purchase accounting tax credits. reduction valuation allowance recognition tax benefits recorded to income taxes final determination valuation allowance conclusion measurement period.
millions
 Deferred tax assets
 Accruals allowances $541 $567
 Employee compensation benefits 646
 revenue 322
 property plant intangible assets 1,238
 Tax credit loss 3,717 2,614
 deferred tax assets 6,464 4,183
 Valuation allowance
 5,198 2,875
 Unrealized gain stock
 Acquired intangible assets (973
 property
 tax liabilities (2,766
 $2,432 $1,337
-current deferred $2,696 $1,395


tables summarize unrealized gains losses restricted investments December 31, 2019 2018
 31, 2019 no investments loss 12 months. 31, 2018 six investments $87. 4 million 12 unrealized losses $6. 4 million. losses due interest rates. hold securities until cost basis. impaired.
 31, 2019
 Foreign government obligations $129,499  $3,433 $126,066
. obligations 99,700 97,719
. $229,199 $5,414 $223,785
 December 31, 2018
 Foreign obligations $73,798  $14,234 $235 $87,797
. 97,223
 $171,021 $14,650


AMERICAN TOWER CORPORATION SUBSIDIARIES FINANCIAL STATEMENTS amounts millions
 December 31, 2019 2018 valuation allowance $194. 2 million $151. 9 million foreign items. increase allowance 2019 due uncertainty timing deferred tax assets foreign operations offset foreign currency exchange rates. deferred tax assets adjusted if weight subjective evidence projections growth.
 valuation allowance
 Includes net charges expense allowances acquisition.
 recoverability deferred tax assets assessed current operations. not dependent material asset sales non-routine transactions. believes deferred tax assets realized.
 Balance January 1, $151. $142. $144.
.
.
 currency.
 Balance December 31, $194. $151. $142.


. Derivative Financial Instruments
 global company exposed to interest rate foreign currency risks financial position results cash flows. use derivative instruments hedge hold not trading.
 market conditions assets liabilities. report at fair value account changes if hedge accounting. record changes fair value to earnings. See Note 11. “Fair Value Measurements” financial statements.
 tables fair values derivative instruments balance sheets December 31, 2019 2018
 Prepaid Expenses Current Assets Liabilities
 Derivatives hedging instruments
 Foreign exchange forward contracts $226 $139 $369 $230
 not
 Foreign exchange forward contracts $973  $1,807
 Interest rate swap contracts. 406 7,209
 derivatives not.$973 $2,213,209
. $1,199