| _id | dd497c870 |
| title |  |
| text | increased investment in programming to support subscriber growth , higher offer costs and continued investment in presto , partially offset by lower depreciation expense resulting from foxtel 2019s reassessment of the useful lives of cable and satellite installations .
net income decreased as a result of the lower operating income noted above , partially offset by lower income tax expense .

( b ) other equity affiliates , net for the fiscal year ended june 30 , 2016 includes losses primarily from the company 2019s interests in draftstars and elara technologies , which owns proptiger .
interest , net 2014interest , net for the fiscal year ended june 30 , 2016 decreased $ 13 million , or 23% ( 23 % ) , as compared to fiscal 2015 , primarily due to the negative impact of foreign currency fluctuations and interest expense associated with the rea facility .

( see note 9 to the consolidated financial statements ) .
other , net 2014 for the fiscal years ended june 30 .

( a ) rea group recognized a gain of $ 29 million resulting from the revaluation of its previously held equity interest in iproperty during the fiscal year ended june 30 , 2016 .
( see note 3 to the consolidated financial statements ) .
( b ) the company recorded write-offs and impairments of certain investments in the fiscal years ended june 30 , 2016 and 2015 .

these write-offs and impairments were taken either as a result of the deteriorating financial position of the investee or due to an other-than-temporary impairment resulting from sustained losses and limited prospects for recovery .
( see note 6 to the consolidated financial statements. ) ( c ) in august 2014 , rea group completed the sale of a minority interest held in marketable securities for total cash consideration of $ 104 million .

as a result of the sale , rea group recognized a pre-tax gain of $ 29 million , which was reclassified out of accumulated other comprehensive income and included in other , net in the statement of operations .

income tax benefit ( expense ) 2014the company 2019s income tax benefit and effective tax rate for the fiscal year ended june 30 , 2016 were $ 54 million and ( 30% ( 30 % ) ) , respectively , as compared to an income tax expense and effective tax rate of $ 185 million and 34% ( 34 % ) , respectively , for fiscal 2015 .

for the fiscal years ended june 30 , 2016 the company recorded a tax benefit of $ 54 million on pre-tax income of $ 181 million resulting in an effective tax rate that was lower than the u.s .
statutory tax .
the lower tax rate was primarily due to a tax benefit of approximately $ 106 million related to the release of previously established valuation allowances related to certain u.s .
federal net operating losses and state deferred tax assets .

this benefit was recognized in conjunction with management 2019s plan to dispose of the company 2019s digital education business in the first quarter of fiscal 2016 , as the company now expects to generate sufficient u.s .
taxable income to utilize these deferred tax assets prior to expiration .
in addition , the effective tax rate was also impacted by the $ 29 million non-taxable gain resulting from the revaluation of rea group 2019s previously held equity interest in iproperty .

for the fiscal year ended june 30 , 2015 , the company 2019s effective tax rate was lower than the u.s .
statutory tax rate primarily due to the impact from foreign operations which are subject to lower tax rates , partially offset by the impact of nondeductible items and changes in our accrued liabilities for uncertain tax positions .
( see note 18 to the consolidated financial statements ) .

 |
| table | ( in millions )                                                       | for the fiscal years ended june 30 , 2016 | for the fiscal years ended june 30 , 2015
--------------------------------------------------------------------- | ----------------------------------------- | -----------------------------------------
gain on iproperty transaction ( a )                                   | $ 29                                      | $ 2014
impairment of marketable securities and cost method investments ( b ) | -21 ( 21 )                                | -5 ( 5 )
gain on sale of marketable securities ( c )                           | 2014                                      | 29
dividends received from cost method investments                       | 2014                                      | 25
gain on sale of cost method investments                               | 2014                                      | 15
other                                                                 | 10                                        | 11
total other net                                                       | $ 18                                      | $ 75 |


| _id | dd497edaa |
| title |  |
| text | the future minimum lease commitments under these leases at december 31 , 2010 are as follows ( in thousands ) : years ending december 31: .

rental expense for operating leases was approximately $ 66.9 million , $ 57.2 million and $ 49.0 million during the years ended december 31 , 2010 , 2009 and 2008 , respectively .
in connection with the acquisitions of several businesses , we entered into agreements with several sellers of those businesses , some of whom became stockholders as a result of those acquisitions , for the lease of certain properties used in our operations .

typical lease terms under these agreements include an initial term of five years , with three to five five-year renewal options and purchase options at various times throughout the lease periods .
we also maintain the right of first refusal concerning the sale of the leased property .

lease payments to an employee who became an officer of the company after the acquisition of his business were approximately $ 1.0 million , $ 0.9 million and $ 0.9 million during each of the years ended december 31 , 2010 , 2009 and 2008 , respectively .
we guarantee the residual values of the majority of our truck and equipment operating leases .
the residual values decline over the lease terms to a defined percentage of original cost .

in the event the lessor does not realize the residual value when a piece of equipment is sold , we would be responsible for a portion of the shortfall .
similarly , if the lessor realizes more than the residual value when a piece of equipment is sold , we would be paid the amount realized over the residual value .
had we terminated all of our operating leases subject to these guarantees at december 31 , 2010 , the guaranteed residual value would have totaled approximately $ 31.4 million .

we have not recorded a liability for the guaranteed residual value of equipment under operating leases as the recovery on disposition of the equipment under the leases is expected to approximate the guaranteed residual value .
litigation and related contingencies in december 2005 and may 2008 , ford global technologies , llc filed complaints with the international trade commission against us and others alleging that certain aftermarket parts imported into the u.s .
infringed on ford design patents .

infringed on ford design patents .
the parties settled these matters in april 2009 pursuant to a settlement arrangement that expires in september 2011 .
pursuant to the settlement , we ( and our designees ) became the sole distributor in the u.s .
of aftermarket automotive parts that correspond to ford collision parts that are covered by a u.s .
design patent .
we have paid ford an upfront fee for these rights and will pay a royalty for each such part we sell .

the amortization of the upfront fee and the royalty expenses are reflected in cost of goods sold on the accompanying consolidated statements of income .
we also have certain other contingencies resulting from litigation , claims and other commitments and are subject to a variety of environmental and pollution control laws and regulations incident to the ordinary course of business .

we currently expect that the resolution of such contingencies will not materially affect our financial position , results of operations or cash flows.

 |
| table | 2011                          | $ 62465
----------------------------- | --------
2012                          | 54236
2013                          | 47860
2014                          | 37660
2015                          | 28622
thereafter                    | 79800
future minimum lease payments | $ 310643 |


| _id | dd4c501b4 |
| title |  |
| text | at its catlettsburg , kentucky refinery , map has completed the approximately $ 440 million multi-year integrated investment program to upgrade product yield realizations and reduce fixed and variable manufacturing expenses .
this program involves the expansion , conversion and retirement of certain refinery processing units that , in addition to improving profitability , will allow the refinery to begin producing low-sulfur ( tier 2 ) gasoline .
project startup was in the first quarter of 2004 .

in the fourth quarter of 2003 , map commenced approximately $ 300 million in new capital projects for its 74000 bpd detroit , michigan refinery .
one of the projects , a $ 110 million expansion project , is expected to raise the crude oil capacity at the refinery by 35 percent to 100000 bpd .
other projects are expected to enable the refinery to produce new clean fuels and further control regulated air emissions .
completion of the projects is scheduled for the fourth quarter of 2005 .

marathon will loan map the funds necessary for these upgrade and expansion projects .
marketing in 2003 , map 2019s refined product sales volumes ( excluding matching buy/sell transactions ) totaled 19.8 billion gallons ( 1293000 bpd ) .

excluding sales related to matching buy/sell transactions , the wholesale distribution of petroleum products to private brand marketers and to large commercial and industrial consumers , primarily located in the midwest , the upper great plains and the southeast , and sales in the spot market , accounted for approximately 70 percent of map 2019s refined product sales volumes in 2003 .

approximately 50 percent of map 2019s gasoline volumes and 91 percent of its distillate volumes were sold on a wholesale or spot market basis to independent unbranded customers or other wholesalers in 2003 .
approximately half of map 2019s propane is sold into the home heating markets and industrial consumers purchase the balance .
propylene , cumene , aromatics , aliphatics , and sulfur are marketed to customers in the chemical industry .

base lube oils and slack wax are sold throughout the united states .
pitch is also sold domestically , but approximately 13 percent of pitch products are exported into growing markets in canada , mexico , india , and south america .
map markets asphalt through owned and leased terminals throughout the midwest and southeast .

the map customer base includes approximately 900 asphalt-paving contractors , government entities ( states , counties , cities and townships ) and asphalt roofing shingle manufacturers .
the following table sets forth the volume of map 2019s consolidated refined product sales by product group for each of the last three years : refined product sales ( thousands of barrels per day ) 2003 2002 2001 .

map sells reformulated gasoline in parts of its marketing territory , primarily chicago , illinois ; louisville , kentucky ; northern kentucky ; and milwaukee , wisconsin .
map also sells low-vapor-pressure gasoline in nine states .
as of december 31 , 2003 , map supplied petroleum products to approximately 3900 marathon and ashland branded retail outlets located primarily in michigan , ohio , indiana , kentucky and illinois .

branded retail outlets are also located in florida , georgia , wisconsin , west virginia , minnesota , tennessee , virginia , pennsylvania , north carolina , south carolina and alabama.

 |
| table | ( thousands of barrels per day )            | 2003 | 2002 | 2001
------------------------------------------- | ---- | ---- | ----
gasoline                                    | 776  | 773  | 748
distillates                                 | 365  | 346  | 345
propane                                     | 21   | 22   | 21
feedstocks and special products             | 97   | 82   | 71
heavy fuel oil                              | 24   | 20   | 41
asphalt                                     | 74   | 75   | 78
total                                       | 1357 | 1318 | 1304
matching buy/sell volumes included in above | 64   | 71   | 45 |


| _id | dd4bca050 |
| title |  |
| text | entergy corporation and subsidiaries notes to financial statements entergy new orleans securitization bonds - hurricane isaac in may 2015 the city council issued a financing order authorizing the issuance of securitization bonds to recover entergy new orleans 2019s hurricane isaac storm restoration costs of $ 31.8 million , including carrying costs , the costs of funding and replenishing the storm recovery reserve in the amount of $ 63.9 million , and approximately $ 3 million of up-front financing costs

$ 3 million of up-front financing costs associated with the securitization .

in july 2015 , entergy new orleans storm recovery funding i , l.l.c. , a company wholly owned and consolidated by entergy new orleans , issued $ 98.7 million of storm cost recovery bonds .
the bonds have a coupon of 2.67% ( 2.67 % ) and an expected maturity date of june 2024 .

although the principal amount is not due until the date given above , entergy new orleans storm recovery funding expects to make principal payments on the bonds over the next five years in the amounts of $ 11.4 million for 2016 , $ 10.6 million for 2017 , $ 11 million for 2018 , $ 11.2 million for 2019 , and $ 11.6 million for 2020 .

with the proceeds , entergy new orleans storm recovery funding purchased from entergy new orleans the storm recovery property , which is the right to recover from customers through a storm recovery charge amounts sufficient to service the securitization bonds .
the storm recovery property is reflected as a regulatory asset on the consolidated entergy new orleans balance sheet .

the creditors of entergy new orleans do not have recourse to the assets or revenues of entergy new orleans storm recovery funding , including the storm recovery property , and the creditors of entergy new orleans storm recovery funding do not have recourse to the assets or revenues of entergy new orleans .
entergy new orleans has no payment obligations to entergy new orleans storm recovery funding except to remit storm recovery charge collections .

entergy texas securitization bonds - hurricane rita in april 2007 the puct issued a financing order authorizing the issuance of securitization bonds to recover $ 353 million of entergy texas 2019s hurricane rita reconstruction costs and up to $ 6 million of transaction costs , offset by $ 32 million of related deferred income tax benefits .

in june 2007 , entergy gulf states reconstruction funding i , llc , a company that is now wholly-owned and consolidated by entergy texas , issued $ 329.5 million of senior secured transition bonds ( securitization bonds ) as follows : amount ( in thousands ) .

although the principal amount of each tranche is not due until the dates given above , entergy gulf states reconstruction funding expects to make principal payments on the bonds over the next five years in the amounts of $ 26 million for 2016 , $ 27.6 million for 2017 , $ 29.2 million for 2018 , $ 30.9 million for 2019 , and $ 32.8 million for 2020 .

all of the scheduled principal payments for 2016 are for tranche a-2 , $ 23.6 million of the scheduled principal payments for 2017 are for tranche a-2 and $ 4 million of the scheduled principal payments for 2017 are for tranche a-3 .
all of the scheduled principal payments for 2018-2020 are for tranche a-3 .

with the proceeds , entergy gulf states reconstruction funding purchased from entergy texas the transition property , which is the right to recover from customers through a transition charge amounts sufficient to service the securitization bonds .
the transition property is reflected as a regulatory asset on the consolidated entergy texas balance sheet .

the creditors of entergy texas do not have recourse to the assets or revenues of entergy gulf states reconstruction funding , including the transition property , and the creditors of entergy gulf states reconstruction funding do not have recourse to the assets or revenues of entergy texas .
entergy texas has no payment obligations to entergy gulf states reconstruction funding except to remit transition charge collections.

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


| _id | dd4bbd79c |
| title |  |
| text | performance graph this graph compares the return on lilly stock with that of the standard & poor 2019s 500 stock index and our peer group for the years 2014 through 2018 .
the graph assumes that , on december 31 , 2013 , a person invested $ 100 each in lilly stock , the s&p 500 stock index , and the peer groups' common stock .
the graph measures total shareholder return , which takes into account both stock price and dividends .

it assumes that dividends paid by a company are reinvested in that company 2019s stock .
value of $ 100 invested on last business day of 2013 comparison of five-year cumulative total return among lilly , s&p 500 stock index , peer group ( 1 ) .

( 1 ) we constructed the peer group as the industry index for this graph .

it comprises the companies in the pharmaceutical and biotech industries that we used to benchmark the compensation of our executive officers for 2018 : abbvie inc. ; amgen inc. ; astrazeneca plc ; baxter international inc. ; biogen idec inc. ; bristol-myers squibb company ; celgene corporation ; gilead sciences inc. ; glaxosmithkline plc ; johnson & johnson ; medtronic plc ; merck & co. , inc. ; novartis ag. ; pfizer inc. ; roche holdings ag ; sanofi ; and shire plc.

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


| _id | dd4b89942 |
| title |  |
| text | purchases of equity securities the following table provides information about our repurchases of our common stock registered pursuant to section 12 of the securities exchange act of 1934 during the quarter ended december 31 , 2014 .
period ( a ) number of shares purchased average price paid per share total number of shares purchased as part of publicly announced plans or programs ( b ) amount available for future share repurchases under the plans or programs ( b ) ( in millions ) .

total 1269242 ( c ) $ 185.23 1212228 $ 3671 ( a ) we close our books and records on the last sunday of each month to align our financial closing with our business processes , except for the month of december , as our fiscal year ends on december 31 .
as a result , our fiscal months often differ from the calendar months .
for example , september 29 , 2014 was the first day of our october 2014 fiscal month .

( b ) in october 2010 , our board of directors approved a share repurchase program pursuant to which we are authorized to repurchase our common stock in privately negotiated transactions or in the open market at prices per share not exceeding the then-current market prices .
on september 25 , 2014 , our board of directors authorized a $ 2.0 billion increase to the program .

under the program , management has discretion to determine the dollar amount of shares to be repurchased and the timing of any repurchases in compliance with applicable law and regulation .
we also may make purchases under the program pursuant to rule 10b5-1 plans .
the program does not have an expiration date .

the program does not have an expiration date .
( c ) during the quarter ended december 31 , 2014 , the total number of shares purchased included 57014 shares that were transferred to us by employees in satisfaction of minimum tax withholding obligations associated with the vesting of restricted stock units .
these purchases were made pursuant to a separate authorization by our board of directors and are not included within the program.

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


| _id | dd4975d4a |
| title |  |
| text | marathon oil corporation notes to consolidated financial statements of the $ 446 million present value of net minimum capital lease payments , $ 53 million was related to obligations assumed by united states steel under the financial matters agreement .
operating lease rental expense was : ( in millions ) 2009 2008 2007 minimum rental ( a ) $ 238 $ 245 $ 209 .

( a ) excludes $ 3 million , $ 5 million and $ 8 million paid by united states steel in 2009 , 2008 and 2007 on assumed leases .
26 .
commitments and contingencies we are the subject of , or party to , a number of pending or threatened legal actions , contingencies and commitments involving a variety of matters , including laws and regulations relating to the environment .
certain of these matters are discussed below .

certain of these matters are discussed below .
the ultimate resolution of these contingencies could , individually or in the aggregate , be material to our consolidated financial statements .
however , management believes that we will remain a viable and competitive enterprise even though it is possible that these contingencies could be resolved unfavorably .
environmental matters 2013 we are subject to federal , state , local and foreign laws and regulations relating to the environment .

these laws generally provide for control of pollutants released into the environment and require responsible parties to undertake remediation of hazardous waste disposal sites .
penalties may be imposed for noncompliance .
at december 31 , 2009 and 2008 , accrued liabilities for remediation totaled $ 116 million and $ 111 million .
it is not presently possible to estimate the ultimate amount of all remediation costs that might be incurred or the penalties that may be imposed .

receivables for recoverable costs from certain states , under programs to assist companies in clean-up efforts related to underground storage tanks at retail marketing outlets , were $ 59 and $ 60 million at december 31 , 2009 and 2008 .
legal cases 2013 we , along with other refining companies , settled a number of lawsuits pertaining to methyl tertiary-butyl ether ( 201cmtbe 201d ) in 2008 .

presently , we are a defendant , along with other refining companies , in 27 cases arising in four states alleging damages for mtbe contamination .
like the cases that we settled in 2008 , 12 of the remaining cases are consolidated in a multi-district litigation ( 201cmdl 201d ) in the southern district of new york for pretrial proceedings .
the other 15 cases are in new york state courts ( nassau and suffolk counties ) .

plaintiffs in 26 of the 27 cases allege damages to water supply wells from contamination of groundwater by mtbe , similar to the damages claimed in the cases settled in 2008 .
in the remaining case , the new jersey department of environmental protection is seeking the cost of remediating mtbe contamination and natural resources damages allegedly resulting from contamination of groundwater by mtbe .
we are vigorously defending these cases .

we are vigorously defending these cases .
we have engaged in settlement discussions related to the majority of these cases .
we do not expect our share of liability for these cases to significantly impact our consolidated results of operations , financial position or cash flows .
we voluntarily discontinued producing mtbe in 2002 .

we are currently a party to one qui tam case , which alleges that marathon and other defendants violated the false claims act with respect to the reporting and payment of royalties on natural gas and natural gas liquids for federal and indian leases .
a qui tam action is an action in which the relator files suit on behalf of himself as well as the federal government .
the case currently pending is u.s .
ex rel harrold e .
wright v .
agip petroleum co .
et al .
it is primarily a gas valuation case .

et al .
it is primarily a gas valuation case .
marathon has reached a settlement with the relator and the doj which will be finalized after the indian tribes review and approve the settlement terms .
such settlement is not expected to significantly impact our consolidated results of operations , financial position or cash flows .
guarantees 2013 we have provided certain guarantees , direct and indirect , of the indebtedness of other companies .

under the terms of most of these guarantee arrangements , we would be required to perform should the guaranteed party fail to fulfill its obligations under the specified arrangements .
in addition to these financial guarantees , we also have various performance guarantees related to specific agreements.

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


| _id | dd4c55e7a |
| title |  |
| text | performance graph the following graph compares the yearly change in the cumulative total stockholder return for our last five full fiscal years , based upon the market price of our common stock , with the cumulative total return on a nasdaq composite index ( u.s .
companies ) and a peer group , the nasdaq medical equipment-sic code 3840-3849 index , which is comprised of medical equipment companies , for that period .

the performance graph assumes the investment of $ 100 on march 31 , 2007 in our common stock , the nasdaq composite index ( u.s .
companies ) and the peer group index , and the reinvestment of any and all dividends. .

this graph is not 201csoliciting material 201d under regulation 14a or 14c of the rules promulgated under the securities exchange act of 1934 , is not deemed filed with the securities and exchange commission and is not to be incorporated by reference in any of our filings under the securities act of 1933 , as amended , or the exchange act whether made before or after the date hereof and irrespective of any general incorporation language in any such filing .

transfer agent american stock transfer & trust company , 59 maiden lane , new york , ny 10038 , is our stock transfer agent.

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


| _id | dd4ba63da |
| title |  |
| text | customary affirmative and negative covenants and events of default for an unsecured financing arrangement , including , among other things , limitations on consolidations , mergers and sales of assets .
financial covenants include a maximum leverage ratio of 3.0 to 1.0 and a minimum interest coverage ratio of 3.5 to 1.0 .
if we fall below an investment grade credit rating , additional restrictions would result , including restrictions on investments , payment of dividends and stock repurchases .

we were in compliance with all covenants under the senior credit facility as of december 31 , 2007 .
commitments under the senior credit facility are subject to certain fees , including a facility and a utilization fee .
the senior credit facility is rated a- by standard & poor 2019s ratings services and is not rated by moody 2019s investors 2019 service , inc .
we also have available uncommitted credit facilities totaling $ 70.4 million .

management believes that cash flows from operations , together with available borrowings under the senior credit facility , are sufficient to meet our expected working capital , capital expenditure and debt service needs .
should investment opportunities arise , we believe that our earnings , balance sheet and cash flows will allow us to obtain additional capital , if necessary .

contractual obligations we have entered into contracts with various third parties in the normal course of business which will require future payments .
the following table illustrates our contractual obligations ( in millions ) : contractual obligations total 2008 thereafter .

total contractual obligations $ 591.6 $ 58.6 $ 156.4 $ 203.9 $ 172.7 critical accounting estimates our financial results are affected by the selection and application of accounting policies and methods .
significant accounting policies which require management 2019s judgment are discussed below .
excess inventory and instruments 2013 we must determine as of each balance sheet date how much , if any , of our inventory may ultimately prove to be unsaleable or unsaleable at our carrying cost .

similarly , we must also determine if instruments on hand will be put to productive use or remain undeployed as a result of excess supply .
reserves are established to effectively adjust inventory and instruments to net realizable value .
to determine the appropriate level of reserves , we evaluate current stock levels in relation to historical and expected patterns of demand for all of our products and instrument systems and components .

the basis for the determination is generally the same for all inventory and instrument items and categories except for work-in-progress inventory , which is recorded at cost .
obsolete or discontinued items are generally destroyed and completely written off .
management evaluates the need for changes to valuation reserves based on market conditions , competitive offerings and other factors on a regular basis .

income taxes fffd we estimate income tax expense and income tax liabilities and assets by taxable jurisdiction .
realization of deferred tax assets in each taxable jurisdiction is dependent on our ability to generate future taxable income sufficient to realize the benefits .
we evaluate deferred tax assets on an ongoing basis and provide valuation allowances if it is determined to be 201cmore likely than not 201d that the deferred tax benefit will not be realized .

federal income taxes are provided on the portion of the income of foreign subsidiaries that is expected to be remitted to the u.s .
we operate within numerous taxing jurisdictions .
we are subject to regulatory review or audit in virtually all of those jurisdictions and those reviews and audits may require extended periods of time to resolve .

we make use of all available information and make reasoned judgments regarding matters requiring interpretation in establishing tax expense , liabilities and reserves .
we believe adequate provisions exist for income taxes for all periods and jurisdictions subject to review or audit .

commitments and contingencies 2013 accruals for product liability and other claims are established with internal and external legal counsel based on current information and historical settlement information for claims , related fees and for claims incurred but not reported .
we use an actuarial model to assist management in determining an appropriate level of accruals for product liability claims .

historical patterns of claim loss development over time are statistically analyzed to arrive at factors which are then applied to loss estimates in the actuarial model .
the amounts established equate to less than 5 percent of total liabilities and represent management 2019s best estimate of the ultimate costs that we will incur under the various contingencies .

goodwill and intangible assets 2013 we evaluate the carrying value of goodwill and indefinite life intangible assets annually , or whenever events or circumstances indicate the carrying value may not be recoverable .
we evaluate the carrying value of finite life intangible assets whenever events or circumstances indicate the carrying value may not be recoverable .

significant assumptions are required to estimate the fair value of goodwill and intangible assets , most notably estimated future cash flows generated by these assets .
as such , these fair valuation measurements use significant unobservable inputs as defined under statement of financial accounting standards no .
157 , fair value measurements .
changes to these assumptions could require us to record impairment charges on these assets .

share-based payment 2013 we account for share-based payment expense in accordance with the fair value z i m m e r h o l d i n g s , i n c .
2 0 0 7 f o r m 1 0 - k a n n u a l r e p o r t

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


| _id | dd4b9c542 |
| title |  |
| text | stock performance graph the following performance graph compares the cumulative total return ( including dividends ) to the holders of our common stock from december 31 , 2002 through december 31 , 2007 , with the cumulative total returns of the nyse composite index , the ftse nareit composite reit index ( the 201call reit index 201d ) , the ftse nareit healthcare equity reit index ( the 201chealthcare reit index 201d ) and the russell 1000 index over the same period .

the comparison assumes $ 100 was invested on december 31 , 2002 in our common stock and in each of the foregoing indices and assumes reinvestment of dividends , as applicable .
we have included the nyse composite index in the performance graph because our common stock is listed on the nyse .

we have included the other indices because we believe that they are either most representative of the industry in which we compete , or otherwise provide a fair basis for comparison with ventas , and are therefore particularly relevant to an assessment of our performance .
the figures in the table below are rounded to the nearest dollar. .

ventas nyse composite index all reit index healthcare reit index russell 1000 index

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


| _id | dd4980376 |
| title |  |
| text | 4 .
stock options and other stock plans we have 100962 options outstanding under the 1993 stock option and retention stock plan of union pacific corporation ( 1993 plan ) .
there are 7140 restricted shares outstanding under the 1992 restricted stock plan for non-employee directors of union pacific corporation .
we no longer grant options or awards of retention shares and units under these plans .

in april 2000 , the shareholders approved the union pacific corporation 2000 directors plan ( directors plan ) whereby 1100000 shares of our common stock were reserved for issuance to our non-employee directors .
under the directors plan , each non-employee director , upon his or her initial election to the board of directors , receives a grant of 2000 shares of retention shares or retention stock units .

prior to december 31 , 2007 , each non-employee director received annually an option to purchase at fair value a number of shares of our common stock , not to exceed 10000 shares during any calendar year , determined by dividing 60000 by 1/3 of the fair market value of one share of our common stock on the date of such board of directors meeting , with the resulting quotient rounded up or down to the nearest 50 shares .

as of december 31 , 2009 , 18000 restricted shares were outstanding under the directors plan and 292000 options were outstanding under the directors plan .
the union pacific corporation 2001 stock incentive plan ( 2001 plan ) was approved by the shareholders in april 2001 .

the 2001 plan reserved 24000000 shares of our common stock for issuance to eligible employees of the corporation and its subsidiaries in the form of non-qualified options , incentive stock options , retention shares , stock units , and incentive bonus awards .
non-employee directors were not eligible for awards under the 2001 plan .
as of december 31 , 2009 , 3366230 options were outstanding under the 2001 plan .
we no longer grant any stock options or other stock or unit awards under this plan .

the union pacific corporation 2004 stock incentive plan ( 2004 plan ) was approved by shareholders in april 2004 .
the 2004 plan reserved 42000000 shares of our common stock for issuance , plus any shares subject to awards made under the 2001 plan and the 1993 plan that were outstanding on april 16 , 2004 , and became available for regrant pursuant to the terms of the 2004 plan .

under the 2004 plan , non- qualified options , stock appreciation rights , retention shares , stock units , and incentive bonus awards may be granted to eligible employees of the corporation and its subsidiaries .
non-employee directors are not eligible for awards under the 2004 plan .
as of december 31 , 2009 , 8939710 options and 3778997 retention shares and stock units were outstanding under the 2004 plan .

pursuant to the above plans 33559150 ; 36961123 ; and 38601728 shares of our common stock were authorized and available for grant at december 31 , 2009 , 2008 , and 2007 , respectively .
stock options 2013 we estimate the fair value of our stock option awards using the black-scholes option pricing model .
groups of employees and non-employee directors that have similar historical and expected exercise behavior are considered separately for valuation purposes .

the table below shows the annual weighted-average assumptions used for valuation purposes : weighted-average assumptions 2009 2008 2007 .

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


| _id | dd4b8a14e |
| title |  |
| text | item 7 .
management 2019s discussion and analysis of financial condition and results of operations executive summary international paper 2019s operating results in 2007 bene- fited from significantly higher paper and packaging price realizations .
sales volumes were slightly high- er , with growth in overseas markets partially offset by lower volumes in north america as we continued to balance our production with our customers 2019 demand .

operationally , our pulp and paper and containerboard mills ran very well in 2007 .
however , input costs for wood , energy and transportation costs were all well above 2006 levels .
in our forest products business , earnings decreased 31% ( 31 % ) reflect- ing a sharp decline in harvest income and a smaller drop in forestland and real estate sales , both reflect- ing our forestland divestitures in 2006 .

interest expense decreased over 40% ( 40 % ) , principally due to lower debt balances and interest rates from debt repayments and refinancings .
looking forward to the first quarter of 2008 , we expect demand for north american printing papers and packaging to remain steady .
however , if the economic downturn in 2008 is greater than expected , this could have a negative impact on sales volumes and earnings .

some slight increases in paper and packaging price realizations are expected as we implement our announced price increases .
however , first quarter earnings will reflect increased planned maintenance expenses and continued escalation of wood , energy and transportation costs .
as a result , excluding the impact of projected reduced earnings from land sales and the addition of equity earnings contributions from our recent investment in ilim holding s.a .

in russia , we expect 2008 first-quarter earnings to be lower than in the 2007 fourth quarter .
results of operations industry segment operating profits are used by inter- national paper 2019s management to measure the earn- ings performance of its businesses .
management believes that this measure allows a better under- standing of trends in costs , operating efficiencies , prices and volumes .

industry segment operating profits are defined as earnings before taxes and minority interest , interest expense , corporate items and corporate special items .
industry segment oper- ating profits are defined by the securities and exchange commission as a non-gaap financial measure , and are not gaap alternatives to net earn- ings or any other operating measure prescribed by accounting principles generally accepted in the united states .

international paper operates in six segments : print- ing papers , industrial packaging , consumer pack- aging , distribution , forest products , and specialty businesses and other .
the following table shows the components of net earnings for each of the last three years : in millions 2007 2006 2005 .

* corporate special items include restructuring and other charg- es , net ( gains ) losses on sales and impairments of businesses , gains on transformation plan forestland sales , goodwill impairment charges , insurance recoveries and reversals of reserves no longer required .

industry segment operating profits of $ 2.4 billion were $ 349 million higher in 2007 than in 2006 due principally to the benefits from higher average price realizations ( $ 461 million ) , the net impact of cost reduction initiatives , improved operating perform- ance and a more favorable mix of products sold ( $ 304 million ) , higher sales volumes ( $ 17 million ) , lower special item costs ( $ 115 million ) and other items ( $ 4 million ) .

these benefits more than offset the impacts of higher energy , raw material and freight costs ( $ 205 million ) , higher costs for planned mill maintenance outages ( $ 48 million ) , lower earn- ings from land sales ( $ 101 million ) , costs at the pensacola mill associated with the conversion of a machine to the production of linerboard ( $ 52 million ) and reduced earnings due to net acquisitions and divestitures ( $ 146 million ) .

segment operating profit ( in millions ) $ 2074 ( $ 205 ) ( $ 48 ) $ 17 ( $ 244 ) $ 2423$ 4 ( $ 52 ) ( $ 101 ) $ 461 $ 1000 $ 1500 $ 2000 $ 2500 $ 3000

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


| _id | dd496e3c4 |
| title |  |
| text | entergy corporation notes to consolidated financial statements ( a ) consists of pollution control revenue bonds and environmental revenue bonds , certain series of which are secured by non-interest bearing first mortgage bonds .
( b ) the bonds are subject to mandatory tender for purchase from the holders at 100% ( 100 % ) of the principal amount outstanding on september 1 , 2005 and can then be remarketed .

( c ) the bonds are subject to mandatory tender for purchase from the holders at 100% ( 100 % ) of the principal amount outstanding on september 1 , 2004 and can then be remarketed .
( d ) the bonds had a mandatory tender date of october 1 , 2003 .
entergy louisiana purchased the bonds from the holders , pursuant to the mandatory tender provision , and has not remarketed the bonds at this time .
entergy louisiana used a combination of cash on hand and short-term borrowing to buy-in the bonds .

( e ) on june 1 , 2002 , entergy louisiana remarketed $ 55 million st .
charles parish pollution control revenue refunding bonds due 2030 , resetting the interest rate to 4.9% ( 4.9 % ) through may 2005 .
( f ) the bonds are subject to mandatory tender for purchase from the holders at 100% ( 100 % ) of the principal amount outstanding on june 1 , 2005 and can then be remarketed .

( g ) pursuant to the nuclear waste policy act of 1982 , entergy's nuclear owner/licensee subsidiaries have contracts with the doe for spent nuclear fuel disposal service .
the contracts include a one-time fee for generation prior to april 7 , 1983 .

entergy arkansas is the only entergy company that generated electric power with nuclear fuel prior to that date and includes the one-time fee , plus accrued interest , in long-term ( h ) the fair value excludes lease obligations , long-term doe obligations , and other long-term debt and includes debt due within one year .
it is determined using bid prices reported by dealer markets and by nationally recognized investment banking firms .

the annual long-term debt maturities ( excluding lease obligations ) for debt outstanding as of december 31 , 2003 , for the next five years are as follows: .

in november 2000 , entergy's non-utility nuclear business purchased the fitzpatrick and indian point 3 power plants in a seller-financed transaction .
entergy issued notes to nypa with seven annual installments of approximately $ 108 million commencing one year from the date of the closing , and eight annual installments of $ 20 million commencing eight years from the date of the closing .
these notes do not have a stated interest rate , but have an implicit interest rate of 4.8% ( 4.8 % ) .

in accordance with the purchase agreement with nypa , the purchase of indian point 2 resulted in entergy's non-utility nuclear business becoming liable to nypa for an additional $ 10 million per year for 10 years , beginning in september 2003 .
this liability was recorded upon the purchase of indian point 2 in september 2001 , and is included in the note payable to nypa balance above .
in july 2003 , a payment of $ 102 million was made prior to maturity on the note payable to nypa .

under a provision in a letter of credit supporting these notes , if certain of the domestic utility companies or system energy were to default on other indebtedness , entergy could be required to post collateral to support the letter of credit .
covenants in the entergy corporation notes require it to maintain a consolidated debt ratio of 65% ( 65 % ) or less of its total capitalization .

if entergy's debt ratio exceeds this limit , or if entergy or certain of the domestic utility companies default on other indebtedness or are in bankruptcy or insolvency proceedings , an acceleration of the notes' maturity dates may occur.

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


| _id | dd4be3ac8 |
| title |  |
| text | notes to the consolidated financial statements union pacific corporation and subsidiary companies for purposes of this report , unless the context otherwise requires , all references herein to the 201ccorporation 201d , 201ccompany 201d , 201cupc 201d , 201cwe 201d , 201cus 201d , and 201cour 201d mean union pacific corporation and its subsidiaries , including union pacific railroad company , which will be separately referred to herein as 201cuprr 201d or the 201crailroad 201d .
1 .

1 .
nature of operations operations and segmentation 2013 we are a class i railroad operating in the u.s .
our network includes 32122 route miles , linking pacific coast and gulf coast ports with the midwest and eastern u.s .
gateways and providing several corridors to key mexican gateways .
we own 26042 miles and operate on the remainder pursuant to trackage rights or leases .

we serve the western two-thirds of the country and maintain coordinated schedules with other rail carriers for the handling of freight to and from the atlantic coast , the pacific coast , the southeast , the southwest , canada , and mexico .
export and import traffic is moved through gulf coast and pacific coast ports and across the mexican and canadian borders .
the railroad , along with its subsidiaries and rail affiliates , is our one reportable operating segment .

although we provide and analyze revenue by commodity group , we treat the financial results of the railroad as one segment due to the integrated nature of our rail network .
the following table provides freight revenue by commodity group: .

although our revenues are principally derived from customers domiciled in the u.s. , the ultimate points of origination or destination for some products we transport are outside the u.s .
each of our commodity groups includes revenue from shipments to and from mexico .
included in the above table are freight revenues from our mexico business which amounted to $ 2.3 billion in 2017 , $ 2.2 billion in 2016 , and $ 2.2 billion in 2015 .

basis of presentation 2013 the consolidated financial statements are presented in accordance with accounting principles generally accepted in the u.s .
( gaap ) as codified in the financial accounting standards board ( fasb ) accounting standards codification ( asc ) .
2 .
significant accounting policies principles of consolidation 2013 the consolidated financial statements include the accounts of union pacific corporation and all of its subsidiaries .

investments in affiliated companies ( 20% ( 20 % ) to 50% ( 50 % ) owned ) are accounted for using the equity method of accounting .
all intercompany transactions are eliminated .
we currently have no less than majority-owned investments that require consolidation under variable interest entity requirements .
cash and cash equivalents 2013 cash equivalents consist of investments with original maturities of three months or less .

accounts receivable 2013 accounts receivable includes receivables reduced by an allowance for doubtful accounts .
the allowance is based upon historical losses , credit worthiness of customers , and current economic conditions .
receivables not expected to be collected in one year and the associated allowances are classified as other assets in our consolidated statements of financial position.

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


| _id | dd4bfc9d8 |
| title |  |
| text | deposits 2014deposits include escrow funds and certain other deposits held in trust .
the company includes cash deposits in other current assets .
deferred compensation obligations 2014the company 2019s deferred compensation plans allow participants to defer certain cash compensation into notional investment accounts .
the company includes such plans in other long-term liabilities .

the value of the company 2019s deferred compensation obligations is based on the market value of the participants 2019 notional investment accounts .
the notional investments are comprised primarily of mutual funds , which are based on observable market prices .
mark-to-market derivative asset and liability 2014the company utilizes fixed-to-floating interest-rate swaps , typically designated as fair-value hedges , to achieve a targeted level of variable-rate debt as a percentage of total debt .

the company also employs derivative financial instruments in the form of variable-to-fixed interest rate swaps and forward starting interest rate swaps , classified as economic hedges and cash flow hedges , respectively , in order to fix the interest cost on existing or forecasted debt .
the company uses a calculation of future cash inflows and estimated future outflows , which are discounted , to determine the current fair value .

additional inputs to the present value calculation include the contract terms , counterparty credit risk , interest rates and market volatility .
other investments 2014other investments primarily represent money market funds used for active employee benefits .
the company includes other investments in other current assets .
note 18 : leases the company has entered into operating leases involving certain facilities and equipment .

rental expenses under operating leases were $ 29 million , $ 24 million and $ 21 million for the years ended december 31 , 2017 , 2016 and 2015 , respectively .
the operating leases for facilities will expire over the next 25 years and the operating leases for equipment will expire over the next 5 years .
certain operating leases have renewal options ranging from one to five years .

the minimum annual future rental commitment under operating leases that have initial or remaining non-cancelable lease terms over the next 5 years and thereafter are as follows: .

the company has a series of agreements with various public entities ( the 201cpartners 201d ) to establish certain joint ventures , commonly referred to as 201cpublic-private partnerships . 201d under the public-private partnerships , the company constructed utility plant , financed by the company and the partners constructed utility plant ( connected to the company 2019s property ) , financed by the partners .

the company agreed to transfer and convey some of its real and personal property to the partners in exchange for an equal principal amount of industrial development bonds ( 201cidbs 201d ) , issued by the partners under a state industrial development bond and commercial development act .
the company leased back the total facilities , including portions funded by both the company and the partners , under leases for a period of 40 years .

the leases related to the portion of the facilities funded by the company have required payments from the company to the partners that approximate the payments required by the terms of the idbs from the partners to the company ( as the holder of the idbs ) .
as the ownership of the portion of the facilities constructed by the

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


| _id | dd4c14a24 |
| title |  |
| text | rental and management operations new site revenue growth .
during the year ended december 31 , 2014 , we grew our portfolio of communications real estate through the acquisition and construction of approximately 8450 sites .
in a majority of our international markets , the acquisition or construction of new sites results in increased pass-through revenues ( such as ground rent or power and fuel costs ) and expenses .

we continue to evaluate opportunities to acquire communications real estate portfolios , both domestically and internationally , to determine whether they meet our risk-adjusted hurdle rates and whether we believe we can effectively integrate them into our existing portfolio. .

( 1 ) the majority of sites acquired or constructed in 2014 were in brazil , india and mexico ; in 2013 were in brazil , colombia , costa rica , india , mexico and south africa ; and in 2012 were in brazil , germany , india and uganda .
rental and management operations expenses .

rental and management operations expenses .
direct operating expenses incurred by our domestic and international rental and management segments include direct site level expenses and consist primarily of ground rent and power and fuel costs , some of which may be passed through to our tenants , as well as property taxes , repairs and maintenance .

these segment direct operating expenses exclude all segment and corporate selling , general , administrative and development expenses , which are aggregated into one line item entitled selling , general , administrative and development expense in our consolidated statements of operations .

in general , our domestic and international rental and management segments 2019 selling , general , administrative and development expenses do not significantly increase as a result of adding incremental tenants to our legacy sites and typically increase only modestly year-over-year .
as a result , leasing additional space to new tenants on our legacy sites provides significant incremental cash flow .

we may , however , incur additional segment selling , general , administrative and development expenses as we increase our presence in geographic areas where we have recently launched operations or are focused on expanding our portfolio .
our profit margin growth is therefore positively impacted by the addition of new tenants to our legacy sites and can be temporarily diluted by our development activities .
network development services segment revenue growth .

as we continue to focus on growing our rental and management operations , we anticipate that our network development services revenue will continue to represent a small percentage of our total revenues .

non-gaap financial measures included in our analysis of our results of operations are discussions regarding earnings before interest , taxes , depreciation , amortization and accretion , as adjusted ( 201cadjusted ebitda 201d ) , funds from operations , as defined by the national association of real estate investment trusts ( 201cnareit ffo 201d ) and adjusted funds from operations ( 201caffo 201d ) .

we define adjusted ebitda as net income before income ( loss ) on discontinued operations , net ; income ( loss ) on equity method investments ; income tax benefit ( provision ) ; other income ( expense ) ; gain ( loss ) on retirement of long-term obligations ; interest expense ; interest income ; other operating income ( expense ) ; depreciation , amortization and accretion ; and stock-based compensation expense .

nareit ffo is defined as net income before gains or losses from the sale or disposal of real estate , real estate related impairment charges , real estate related depreciation , amortization and accretion and dividends declared on preferred stock , and including adjustments for ( i ) unconsolidated affiliates and ( ii ) noncontrolling interest.

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


| _id | dd49749cc |
| title |  |
| text | entergy texas , inc .
and subsidiaries management 2019s financial discussion and analysis results of operations net income 2016 compared to 2015 net income increased $ 37.9 million primarily due to lower other operation and maintenance expenses , the asset write-off of its receivable associated with the spindletop gas storage facility in 2015 , and higher net revenue .

2015 compared to 2014 net income decreased $ 5.2 million primarily due to the asset write-off of its receivable associated with the spindletop gas storage facility and higher other operation and maintenance expenses , partially offset by higher net revenue and a lower effective tax rate .
net revenue 2016 compared to 2015 net revenue consists of operating revenues net of : 1 ) fuel , fuel-related expenses , and gas purchased for resale , 2 ) purchased power expenses , and 3 ) other regulatory charges .

following is an analysis of the change in net revenue comparing 2016 to 2015 .
amount ( in millions ) .

the reserve equalization variance is primarily due to a reduction in reserve equalization expense primarily due to changes in the entergy system generation mix compared to the same period in 2015 as a result of the execution of a new purchased power agreement and entergy mississippi 2019s exit from the system agreement , each in november 2015 , and entergy texas 2019s exit from the system agreement in august 2016 .
see note 2 to the financial statements for a discussion of the system agreement .

the purchased power capacity variance is primarily due to decreased expenses due to the termination of the purchased power agreements between entergy louisiana and entergy texas in august 2016 , as well as capacity cost changes for ongoing purchased power capacity contracts .
the transmission revenue variance is primarily due to an increase in attachment o rates charged by miso to transmission customers and a settlement of attachment o rates previously billed to transmission customers by miso.

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


| _id | dd4be026a |
| title |  |
| text | stock performance graph the following graph provides a comparison of five year cumulative total stockholder returns of teleflex common stock , the standard a0& poor 2019s ( s&p ) 500 stock index and the s&p 500 healthcare equipment & supply index .
the annual changes for the five-year period shown on the graph are based on the assumption that $ 100 had been invested in teleflex common stock and each index on december a031 , 2012 and that all dividends were reinvested .
market performance .

s&p 500 healthcare equipment & supply index 100 128 161 171 181 238

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


| _id | dd4b95954 |
| title |  |
| text | n o t e s t o c o n s o l i d a t e d f i n a n c i a l s t a t e m e n t s ( continued ) ace limited and subsidiaries the following table shows changes in the company 2019s restricted stock for the years ended december 31 , 2008 , 2007 , and 2006 : number of restricted stock weighted average grant- date fair value .

under the provisions of fas 123r , the recognition of deferred compensation , a contra-equity account representing the amount of unrecognized restricted stock expense that is reduced as expense is recognized , at the date restricted stock is granted is no longer permitted .
therefore , upon adoption of fas 123r , the amount of deferred compensation that had been reflected in unearned stock grant compensation was reclassified to additional paid-in capital in the company 2019s consolidated balance sheet .

restricted stock units the company 2019s 2004 ltip also provides for grants of other awards , including restricted stock units .
the company generally grants restricted stock units with a 4-year vesting period , based on a graded vesting schedule .
each restricted stock unit repre- sents the company 2019s obligation to deliver to the holder one share of common shares upon vesting .

during 2008 , the company awarded 223588 restricted stock units to officers of the company and its subsidiaries with a weighted-average grant date fair value of $ 59.93 .
during 2007 , 108870 restricted stock units , with a weighted-average grant date fair value of $ 56.29 were awarded to officers of the company and its subsidiaries .
during 2006 , 83370 restricted stock units , with a weighted-average grant date fair value of $ 56.36 were awarded to officers of the company and its subsidiaries .

the company also grants restricted stock units with a 1-year vesting period to non-management directors .
delivery of common shares on account of these restricted stock units to non-management directors is deferred until six months after the date of the non-management directors 2019 termination from the board .

during 2008 , 2007 , and 2006 , 40362 restricted stock units , 29676 restricted stock units , and 23092 restricted stock units , respectively , were awarded to non-management direc- the espp gives participating employees the right to purchase common shares through payroll deductions during consecutive 201csubscription periods . 201d annual purchases by participants are limited to the number of whole shares that can be purchased by an amount equal to ten percent of the participant 2019s compensation or $

of the participant 2019s compensation or $ 25000 , whichever is less .

the espp has two six-month subscription periods , the first of which runs between january 1 and june 30 and the second of which runs between july 1 and december 31 of each year .
the amounts that have been collected from participants during a subscription period are used on the 201cexercise date 201d to purchase full shares of common shares .
an exercise date is generally the last trading day of a sub- scription period .

the number of shares purchased is equal to the total amount , as of the exercise date , that has been collected from the participants through payroll deductions for that subscription period , divided by the 201cpurchase price 201d , rounded down to the next full share .
effective for and from the second subscription period of 2007 , the purchase price is 85 percent of the fair value of a common share on the exercise date .

prior to the second subscription period of 2007 , the purchase price was calculated as the lower of ( i ) 85 percent of the fair value of a common share on the first day of the subscription period , or

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


| _id | dd4bde186 |
| title |  |
| text | the second largest closed-end fund manager and a top- ten manager by aum and 2013 net flows of long-term open-end mutual funds1 .
in 2013 , we were also the leading manager by net flows for long-dated fixed income mutual funds1 .
2022 we have fully integrated our legacy retail and ishares retail distribution teams to create a unified client-facing presence .

as retail clients increasingly use blackrock 2019s capabilities in combination 2014 active , alternative and passive 2014 it is a strategic priority for blackrock to coherently deliver these capabilities through one integrated team .
2022 international retail long-term net inflows of $ 17.5 billion , representing 15% ( 15 % ) organic growth , were positive across major regions and diversified across asset classes .

equity net inflows of $ 6.4 billion were driven by strong demand for our top-performing european equities franchise as investor risk appetite for the sector improved .
multi-asset class and fixed income products each generated net inflows of $ 4.8 billion , as investors looked to manage duration and volatility in their portfolios .
in 2013 , we were ranked as the third largest cross border fund provider2 .
in the united kingdom , we ranked among the five largest fund managers2 .
ishares .

alternatives ( 2 ) 24337 ( 3053 ) 1645 ( 6837 ) 16092 total ishares $ 752706 $ 63971 $ 15960 $ 81735 $ 914372 ( 1 ) amounts represent $ 16.0 billion of aum acquired in the credit suisse etf acquisition in july 2013 .
( 2 ) amounts include commodity ishares .
ishares is the leading etf provider in the world , with $ 914.4 billion of aum at december 31 , 2013 , and was the top asset gatherer globally in 20133 with $ 64.0 billion of net inflows for an organic growth rate of 8% ( 8 % ) .

equity net inflows of $ 74.1 billion were driven by flows into funds with broad developed market exposures , partially offset by outflows from emerging markets products .
ishares fixed income experienced net outflows of $ 7.5 billion , as the continued low interest rate environment led many liquidity-oriented investors to sell long-duration assets , which made up the majority of the ishares fixed income suite .

in 2013 , we launched several funds to meet demand from clients seeking protection in a rising interest rate environment by offering an expanded product set that includes four new u.s .
funds , including short-duration versions of our flagship high yield and investment grade credit products , and short maturity and liquidity income funds .
ishares alternatives had $ 3.1 billion of net outflows predominantly out of commodities .

ishares represented 23% ( 23 % ) of long-term aum at december 31 , 2013 and 35% ( 35 % ) of long-term base fees for ishares offers the most diverse product set in the industry with 703 etfs at year-end 2013 , and serves the broadest client base , covering more than 25 countries on five continents .

during 2013 , ishares continued its dual commitment to innovation and responsible product structuring by introducing 42 new etfs , acquiring credit suisse 2019s 58 etfs in europe and entering into a critical new strategic alliance with fidelity investments to deliver fidelity 2019s more than 10 million clients increased access to ishares products , tools and support .

our alliance with fidelity investments and a successful full first year for the core series have deeply expanded our presence and offerings among buy-and-hold investors .

our broad product range offers investors a precise , transparent and low-cost way to tap market returns and gain access to a full range of asset classes and global markets that have been difficult or expensive for many investors to access until now , as well as the liquidity required to make adjustments to their exposures quickly and cost-efficiently .
2022 u.s .

2022 u.s .
ishares aum ended at $ 655.6 billion with $ 41.4 billion of net inflows driven by strong demand for developed markets equities and short-duration fixed income .
during the fourth quarter of 2012 , we debuted the core series in the united states , designed to provide the essential building blocks for buy-and-hold investors to use in constructing the core of their portfolio .

the core series demonstrated solid results in its first full year , raising $ 20.0 billion in net inflows , primarily in u.s .
equities .
in the united states , ishares maintained its position as the largest etf provider , with 39% ( 39 % ) share of aum3 .
2022 international ishares aum ended at $ 258.8 billion with robust net new business of $ 22.6 billion led by demand for european and japanese equities , as well as a diverse range of fixed income products .

at year-end 2013 , ishares was the largest european etf provider with 48% ( 48 % ) of aum3 .
1 simfund 2 lipper feri 3 blackrock ; bloomberg

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


| _id | dd4b95f26 |
| title |  |
| text | the table below represents unrealized losses related to derivative amounts included in 201caccumulated other comprehensive loss 201d for the years ended december 31 , ( in thousands ) : balance in accumulated other comprehensive loss .

note 9 2013 fair value measurements the company uses the fair value hierarchy , which prioritizes the inputs used to measure the fair value of certain of its financial instruments .
the hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities ( level 1 measurement ) and the lowest priority to unobservable inputs ( level 3 measurement ) .

the three levels of the fair value hierarchy are set forth below : 2022 level 1 2013 quoted prices are available in active markets for identical assets or liabilities as of the reporting date .
active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis .

2022 level 2 2013 pricing inputs are other than quoted prices in active markets included in level 1 , which are either directly or indirectly observable as of the reporting date .
level 2 includes those financial instruments that are valued using models or other valuation methodologies .

these models are primarily industry-standard models that consider various assumptions , including time value , volatility factors , and current market and contractual prices for the underlying instruments , as well as other relevant economic measures .
substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument , can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace .

2022 level 3 2013 pricing inputs include significant inputs that are generally less observable from objective sources .
these inputs may be used with internally developed methodologies that result in management 2019s best estimate of fair value from the perspective of a market participant .
the fair value of the interest rate swap transactions are based on the discounted net present value of the swap using third party quotes ( level 2 ) .

changes in fair market value are recorded in other comprehensive income ( loss ) , and changes resulting from ineffectiveness are recorded in current earnings .
assets and liabilities measured at fair value are based on one or more of three valuation techniques .

the three valuation techniques are identified in the table below and are as follows : a ) market approach 2013 prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities b ) cost approach 2013 amount that would be required to replace the service capacity of an asset ( replacement cost ) c ) income approach 2013 techniques to convert future amounts to a single present amount based on market expectations ( including present value techniques

expectations ( including present value techniques , option-pricing and excess earnings models )

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


| _id | dd4bb9b92 |
| title |  |
| text | management 2019s discussion and analysis of financial condition and results of operations ( continued ) the following table presents average u.s .
and non-u.s .
short-duration advances for the years ended december 31 : years ended december 31 .

although average short-duration advances for the year ended december 31 , 2013 increased compared to the year ended december 31 , 2012 , such average advances remained low relative to historical levels , mainly the result of clients continuing to hold higher levels of liquidity .
average other interest-earning assets increased to $ 11.16 billion for the year ended december 31 , 2013 from $ 7.38 billion for the year ended december 31 , 2012 .

the increased levels were primarily the result of higher levels of cash collateral provided in connection with our participation in principal securities finance transactions .
aggregate average interest-bearing deposits increased to $ 109.25 billion for the year ended december 31 , 2013 from $ 98.39 billion for the year ended december 31 , 2012 .
this increase was mainly due to higher levels of non-u.s .

transaction accounts associated with the growth of new and existing business in assets under custody and administration .
future transaction account levels will be influenced by the underlying asset servicing business , as well as market conditions , including the general levels of u.s .
and non-u.s .
interest rates .

and non-u.s .
interest rates .
average other short-term borrowings declined to $ 3.79 billion for the year ended december 31 , 2013 from $ 4.68 billion for the year ended december 31 , 2012 , as higher levels of client deposits provided additional liquidity .
average long-term debt increased to $ 8.42 billion for the year ended december 31 , 2013 from $ 7.01 billion for the year ended december 31 , 2012 .

the increase primarily reflected the issuance of $ 1.0 billion of extendible notes by state street bank in december 2012 , the issuance of $ 1.5 billion of senior and subordinated debt in may 2013 , and the issuance of $ 1.0 billion of senior debt in november 2013 .
this increase was partly offset by maturities of $ 1.75 billion of senior debt in the second quarter of 2012 .

average other interest-bearing liabilities increased to $ 6.46 billion for the year ended december 31 , 2013 from $ 5.90 billion for the year ended december 31 , 2012 , primarily the result of higher levels of cash collateral received from clients in connection with our participation in principal securities finance transactions .
several factors could affect future levels of our net interest revenue and margin , including the mix of client liabilities ; actions of various central banks ; changes in u.s .

and non-u.s .
interest rates ; changes in the various yield curves around the world ; revised or proposed regulatory capital or liquidity standards , or interpretations of those standards ; the amount of discount accretion generated by the former conduit securities that remain in our investment securities portfolio ; and the yields earned on securities purchased compared to the yields earned on securities sold or matured .

based on market conditions and other factors , we continue to reinvest the majority of the proceeds from pay- downs and maturities of investment securities in highly-rated securities , such as u.s .
treasury and agency securities , federal agency mortgage-backed securities and u.s .
and non-u.s .
mortgage- and asset-backed securities .
the pace at which we continue to reinvest and the types of investment securities purchased will depend on the impact of market conditions and other factors over time .

we expect these factors and the levels of global interest rates to dictate what effect our reinvestment program will have on future levels of our net interest revenue and net interest margin.

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


| _id | dd4bd0d60 |
| title |  |
| text | the goldman sachs group , inc .
and subsidiaries management 2019s discussion and analysis net revenues the table below presents our net revenues by line item in the consolidated statements of earnings. .

in the table above : 2030 investment banking consists of revenues ( excluding net interest ) from financial advisory and underwriting assignments , as well as derivative transactions directly related to these assignments .
these activities are included in our investment banking segment .

2030 investment management consists of revenues ( excluding net interest ) from providing investment management services to a diverse set of clients , as well as wealth advisory services and certain transaction services to high-net-worth individuals and families .
these activities are included in our investment management segment .

2030 commissions and fees consists of revenues from executing and clearing client transactions on major stock , options and futures exchanges worldwide , as well as over-the-counter ( otc ) transactions .
these activities are included in our institutional client services and investment management segments .

2030 market making consists of revenues ( excluding net interest ) from client execution activities related to making markets in interest rate products , credit products , mortgages , currencies , commodities and equity products .
these activities are included in our institutional client services segment .
2030 other principal transactions consists of revenues ( excluding net interest ) from our investing activities and the origination of loans to provide financing to clients .

in addition , other principal transactions includes revenues related to our consolidated investments .
these activities are included in our investing & lending segment .
operating environment .
during 2017 , generally higher asset prices and tighter credit spreads were supportive of industry-wide underwriting activities , investment management performance and other principal transactions .

however , low levels of volatility in equity , fixed income , currency and commodity markets continued to negatively affect our market-making activities , particularly in fixed income , currency and commodity products .
the price of natural gas decreased significantly during 2017 , while the price of oil increased compared with the end of 2016 .

if the trend of low volatility continues over the long term and market-making activity levels remain low , or if investment banking activity levels , asset prices or assets under supervision decline , net revenues would likely be negatively impacted .
see 201csegment operating results 201d below for further information about the operating environment and material trends and uncertainties that may impact our results of operations .

the first half of 2016 included challenging trends in the operating environment for our business activities including concerns and uncertainties about global economic growth , central bank activity and the political uncertainty and economic implications surrounding the potential exit of the u.k .
from the e.u .
during the second half of 2016 , the operating environment improved , as global equity markets steadily increased and investment grade and high-yield credit spreads tightened .

these trends provided a more favorable backdrop for our business activities .
2017 versus 2016 net revenues in the consolidated statements of earnings were $ 32.07 billion for 2017 , 5% ( 5 % ) higher than 2016 , due to significantly higher other principal transactions revenues , and higher investment banking revenues , investment management revenues and net interest income .
these increases were partially offset by significantly lower market making revenues and lower commissions and fees .

non-interest revenues .
investment banking revenues in the consolidated statements of earnings were $ 7.37 billion for 2017 , 18% ( 18 % ) higher than 2016 .
revenues in financial advisory were higher compared with 2016 , reflecting an increase in completed mergers and acquisitions transactions .

revenues in underwriting were significantly higher compared with 2016 , due to significantly higher revenues in both debt underwriting , primarily reflecting an increase in industry-wide leveraged finance activity , and equity underwriting , reflecting an increase in industry-wide secondary offerings .
52 goldman sachs 2017 form 10-k

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


| _id | dd4bc4c36 |
| title |  |
| text | warfighter information network-tactical ( win-t ) ; command , control , battle management and communications ( c2bmc ) ; and twic ) .
partially offsetting the decreases were higher net sales of approximately $ 140 million from qtc , which was acquired early in the fourth quarter of 2011 ; and about $ 65 million from increased activity on numerous other programs , primarily federal cyber security programs and ptds operational support .

is&gs 2019 operating profit for 2012 decreased $ 66 million , or 8% ( 8 % ) , compared to 2011 .
the decrease was attributable to lower operating profit of approximately $ 50 million due to the favorable impact of the odin contract completion in 2011 ; about $ 25 million due to an increase in reserves for performance issues related to an international airborne surveillance system in 2012 ; and approximately $ 20 million due to lower volume on certain programs ( primarily c2bmc and win-t ) .

partially offsetting the decreases was an increase in operating profit due to higher risk retirements of approximately $ 15 million from the twic program ; and about $ 10 million due to increased activity on numerous other programs , primarily federal cyber security programs and ptds operational support .
operating profit for the jtrs program was comparable as a decrease in volume was offset by a decrease in reserves .

adjustments not related to volume , including net profit booking rate adjustments and other matters described above , were approximately $ 20 million higher for 2012 compared to 2011 .

backlog backlog decreased in 2013 compared to 2012 primarily due to lower orders on several programs ( such as eram and ngi ) , higher sales on certain programs ( the national science foundation antarctic support and the disa gsm-o ) , and declining activities on several smaller programs primarily due to the continued downturn in federal information technology budgets .

backlog decreased in 2012 compared to 2011 primarily due to the substantial completion of various programs in 2011 ( primarily odin , u.k .
census , and jtrs ) .
trends we expect is&gs 2019 net sales to decline in 2014 in the high single digit percentage range as compared to 2013 primarily due to the continued downturn in federal information technology budgets .

operating profit is also expected to decline in 2014 in the high single digit percentage range consistent with the expected decline in net sales , resulting in margins that are comparable with 2013 results .

missiles and fire control our mfc business segment provides air and missile defense systems ; tactical missiles and air-to-ground precision strike weapon systems ; logistics and other technical services ; fire control systems ; mission operations support , readiness , engineering support , and integration services ; and manned and unmanned ground vehicles .

mfc 2019s major programs include pac-3 , thaad , multiple launch rocket system , hellfire , joint air-to-surface standoff missile ( jassm ) , javelin , apache fire control system ( apache ) , sniper ae , low altitude navigation and targeting infrared for night ( lantirn ae ) , and sof clss .
mfc 2019s operating results included the following ( in millions ) : .

2013 compared to 2012 mfc 2019s net sales for 2013 increased $ 300 million , or 4% ( 4 % ) , compared to 2012 .
the increase was primarily attributable to higher net sales of approximately $ 450 million for air and missile defense programs ( thaad and pac-3 ) due to increased production volume and deliveries ; about $ 70 million for fire control programs due to net increased deliveries and volume ; and approximately $ 55 million for tactical missile programs due to net increased deliveries .

the increases were partially offset by lower net sales of about $ 275 million for various technical services programs due to lower volume driven by the continuing impact of defense budget reductions and related competitive pressures .
the increase for fire control programs was primarily attributable to increased deliveries on the sniper ae and lantirn ae programs , increased volume on the sof clss program , partially offset by lower volume on longbow fire control radar and other programs .

the increase for tactical missile programs was primarily attributable to increased deliveries on jassm and other programs , partially offset by fewer deliveries on the guided multiple launch rocket system and javelin programs.

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