8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported): December 10, 2015 (December 10, 2015)

Adobe Systems Incorporated

(Exact name of Registrant as specified in its charter)

Delaware	0-15175	77-0019522
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

345 Park Avenue

San Jose, California 95110-2704

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (408) 536-6000

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On December 10, 2015, Adobe Systems Incorporated (“Adobe”) issued a press release announcing its financial results for its fourth fiscal quarter and fiscal year ended November 27, 2015. A copy of this press release is furnished and attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information in this report and the exhibit attached hereto are being furnished and shall not be deemed filed for purposes of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly stated by specific reference in such filing.

The attached press release includes non-GAAP operating income, non-GAAP net income, non-GAAP tax rate and non-GAAP diluted net income per share.

These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. We believe that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures.

For our internal budgeting and resource allocation process, we use non-GAAP financial measures, net of the related tax impacts, which exclude: (A) stock-based and deferred compensation expenses; (B) restructuring and other charges; (C) amortization of purchased intangibles; (D) investment gains and losses; (E) gain on sale of property assets; (F) accrued loss contingencies; (G) income tax adjustments; and (H) the income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes.

We use these non-GAAP financial measures in making operating decisions because we believe the measures provide meaningful supplemental information regarding our operational performance and give us a better understanding of how we should invest in research and development and fund infrastructure and go-to-market strategies. We use these measures to help us make budgeting decisions, for example, as between product development expenses and research and development, sales and marketing and general and administrative expenses and to facilitate our internal comparisons to our historical operating results. In addition, we believe these non-GAAP financial measures are useful because they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making. This allows institutional investors, the analyst community and others to better understand and evaluate our operating results and future prospects in the same manner as management and to compare operating results across accounting periods and to those of our peer companies.

As described above, we exclude the following items from one or more of our non-GAAP measures:

A.     Stock-based and deferred compensation expenses and related tax impact. Stock-based compensation expense consists of charges for employee restricted stock units, performance shares, stock options and employee stock purchases in accordance with current GAAP related to stock-based compensation including expense associated with stock-based compensation related to unvested options and restricted stock units assumed in connection with our acquisitions. As we apply current stock-based compensation standards, we believe that it is useful to investors to understand the impact of the application of these standards to our operational performance, liquidity and our ability to invest in research and development and fund acquisitions and capital expenditures. Although stock-based compensation expense is calculated in accordance with current GAAP and constitutes an ongoing and recurring expense, such expense is excluded from non-GAAP results because it is not an expense that typically requires or will require cash settlement by us and because such expense is not used by us to assess the core profitability of our business operations. Deferred compensation expense consists of charges associated with movements in our liability related to our deferred compensation plan. Although deferred compensation expense constitutes an ongoing and recurring expense, such expense is excluded from non-GAAP results because it is not an expense that typically requires current cash settlement by us and because such expense is not used by us to assess the core profitability of our business operations. We further believe these measures are useful to investors in that they allow for greater transparency to certain line items in our financial statements. In addition, excluding these items from various non-GAAP measures facilitates comparisons to our competitors’ operating results.

B.     Restructuring and other charges and related tax impact. During the past several years, we have initiated certain restructuring activities in order to align our costs in connection with both our operating plans and our business strategies based on then-current economic conditions. As a result, we recognized costs related to termination benefits for former Adobe employees whose positions were eliminated and the consolidation of leased facilities. Restructuring and other charges are

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excluded from non-GAAP results because such expense is not used by us to assess the core profitability of our business operations.

C.     Amortization of purchased intangibles and related tax impact. We incur amortization of purchased intangibles in connection with our acquisitions. Purchased intangibles include (i) purchased technology, (ii) trademarks, (iii) customer contracts and relationships and (iv) other intangibles. We expect to amortize for accounting purposes the fair value of the purchased intangibles based on the pattern in which the economic benefits of the intangible assets will be consumed as revenue is generated. Although the intangible assets generate revenue for us, we exclude this item because this expense is non-cash in nature and because we believe the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding our operational performance, liquidity and our ability to invest in research and development and fund acquisitions and capital expenditures. In addition, excluding this item from various non-GAAP measures facilitates our internal comparisons to our historical operating results and comparisons to our competitors’ operating results.

D.     Investment gains and losses and related tax impact. We incur investment gains and losses principally from realized gains or losses from the sale and exchange of marketable equity investments, other-than-temporary declines in the value of marketable and non-marketable equity securities, unrealized holding gains and losses associated with our deferred compensation plan assets (classified as trading securities) and gains and losses on the sale of equity securities held indirectly through investment partnerships. We do not actively trade publicly held securities nor do we rely on these securities positions for funding our ongoing operations. We exclude gains and losses and the related tax impact on these equity securities because these items are unrelated to our ongoing business and operating results.

E.     Gain on sale of property assets and related tax impact. During the fourth quarter of fiscal 2015, we sold land and an unoccupied building located in San Jose, California. We exclude such gains and the related tax impact as they are unrelated to our ongoing business and operating results.

F.     Accrued loss contingencies associated with one-time litigation events and related tax impact.  In connection with ongoing litigation or similar events, we accrue losses in the event such losses are determined to be both probable and estimable in accordance with Accounting Standards Codification (ASC) 450-20, Loss Contingencies. Upon resolution of the litigation or event, we adjust the accrual to reflect final resolution. From time to time we exclude such losses and the related tax impact when they relate to one-time events that are unrelated to our ongoing business and operating results.

G.     Income Tax Adjustments. Our Income tax expense is based on our GAAP taxable income and actual tax rates in effect, which can differ significantly from the long-term non-GAAP tax rate applied to our non-GAAP financial results. In arriving at our long-term non-GAAP tax rate, certain non-recurring and period specific income tax adjustments, such as a one-time tax charge in connection with an acquisition, reenactment of the Federal Research and Development tax credit and resolution of an income tax audit, are made to help us to assess the core profitability of our business operations. We evaluate this long-term non-GAAP tax rate only on an annual basis. This long-term non-GAAP tax rate could be subject to change for a number of reasons including significant changes in our geographic earnings mix or fundamental tax law changes in major jurisdictions in which we operate. Based on our long-term projections, a long-term non-GAAP tax rate of 21% has been applied to our non-GAAP financial results in both fiscal 2014 and fiscal 2015.

H.     Income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes. Excluding the income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes assists investors in understanding the tax provision associated with those adjustments and the effective tax rate related to our ongoing operations.

We believe that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our financial results as determined in accordance with GAAP and that these measures should only be used to evaluate our financial results in conjunction with the corresponding GAAP measures and that is why we qualify the use of non-GAAP financial information in a statement when non-GAAP information is presented.

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Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press release issued on December 10, 2015 entitled “Adobe Reports Record Quarterly and Annual Revenue”

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

ADOBE SYSTEMS INCORPORATED
By:	/s/ MARK GARRETT
	Mark Garrett
	Executive Vice President and Chief Financial Officer

Date: December 10, 2015

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release issued on December 10, 2015 entitled “Adobe Reports Record Quarterly and Annual Revenue”

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EX-99.1

Exhibit 99.1

Investor Relations Contact

Mike Saviage

Adobe

408-536-4416

ir@adobe.com

Public Relations Contact

Edie Kissko

Adobe

408-536-3034

kissko@adobe.com

FOR IMMEDIATE RELEASE

Adobe Reports Record Quarterly and Annual Revenue

SAN JOSE, Calif. - Dec. 10, 2015- Adobe (Nasdaq:ADBE) today reported financial results for its fourth quarter and fiscal year 2015 ended Nov. 27, 2015.

Fourth Quarter Financial Highlights

• Adobe achieved record quarterly revenue of $1.31 billion, representing year-over-year growth of 22 percent.

• Diluted earnings per share were $0.44 on a GAAP-basis, and $0.62 on a non-GAAP basis.

• Digital Media Annualized Recurring Revenue (“ARR”) grew to $2.99 billion exiting the quarter, an increase of $350 million. Creative ARR grew to $2.60 billion, an increase of $310 million driven by enterprise adoption and the addition of 833 thousand net new individual and team Creative Cloud subscriptions.

• Adobe Marketing Cloud achieved revenue of $352 million with strong bookings growth and a stronger-than-expected shift in customer adoption to SaaS-based solutions.

• Year-over-year operating income grew 133 percent and net income grew 153 percent on a GAAP-basis; operating income grew 58 percent and net income grew 59 percent on a non-GAAP basis.

• Cash flow from operations was $455 million, and deferred revenue grew to a record $1.49 billion.

• The company repurchased approximately 1.4 million shares during the quarter, returning $122 million of cash to stockholders.

Fiscal Year 2015 Financial Highlights

• Adobe achieved record revenue of $4.80 billion in fiscal year 2015, representing year-over-year growth of 16 percent.

• The company reported annual GAAP diluted earnings per share of $1.24 and non-GAAP diluted earnings per share of $2.08.

• Adobe grew Digital Media ARR by approximately $1.12 billion during the year and exited the year with $2.99 billion. Net new Creative Cloud individual and team subscriptions grew by more than 2.71 million during fiscal year 2015 to 6.17 million.

• Adobe Marketing Cloud achieved a record $1.36 billion in annual revenue and its goal of approximately 30 percent annual bookings growth.

• Adobe generated $1.47 billion in operating cash flow during the year.

• The company repurchased 8.1 million shares during the year, returning approximately $627 million of cash to stockholders.

A reconciliation between GAAP and non-GAAP results is provided at the end of this press release and on Adobe’s website.

Executive Quotes

“Adobe is driving digital experiences that are fundamental to the transformation of every global brand, government and educational institution,” said Shantanu Narayen, president and chief executive officer, Adobe. “Our record revenue and strong momentum are a reflection of our industry-leading content and data solutions in Digital Media and Digital Marketing.”

“Strong growth across key financial metrics reflect the amazing performance we've achieved in fiscal 2015,” said Mark Garrett, executive vice president and chief financial officer, Adobe. “Our long-term financial targets, including a 20% revenue CAGR through fiscal 2018, show that the benefits of our move to the cloud are just beginning.”

Adobe to Webcast Earnings Conference Call

Adobe will webcast its fourth quarter and fiscal year 2015 earnings conference call today at 2:00 p.m. Pacific Time from its investor relations website: www.adobe.com/ADBE. Earnings documents, including Adobe management’s prepared conference call remarks with slides, financial targets and an investor datasheet are posted to Adobe’s investor relations website in advance of the conference call for reference. A reconciliation between GAAP and non-GAAP earnings results and financial targets is also provided on the website.

Forward-Looking Statements Disclosure

This press release contains forward-looking statements, including those related to business momentum, product adoption and innovation, revenue, annualized recurring revenue, bookings, earnings per share and operating cash flow, all of which involve risks and uncertainties that could cause actual results to differ materially. Factors that might cause or contribute to such differences include, but are not limited to: failure to develop, market and distribute products and services that meet customer requirements, introduction of new products and business models by competitors, failure to successfully manage transitions to new business models and markets, fluctuations in subscription renewal rates, risks associated with cyber-attacks and information security, potential interruptions or delays in hosted services provided by us or third parties, uncertainty in economic conditions and the financial markets, and failure to realize the anticipated benefits of past or future acquisitions. For a discussion of these and other risks and uncertainties, please refer to Adobe’s Annual Report on Form 10-K for our fiscal year 2014 ended Nov. 28, 2014, and Adobe's Quarterly Reports on Form 10-Q issued in fiscal year 2015.

The financial information set forth in this press release reflects estimates based on information available at this time. These amounts could differ from actual reported amounts stated in Adobe’s Annual Report on Form 10-K for our year ended Nov. 27, 2015, which Adobe expects to file in Jan. 2016.

Adobe assumes no obligation to, and does not currently intend to, update these forward-looking statements.

About Adobe Systems Incorporated

Adobe is changing the world through digital experiences. For more information, visit www.adobe.com.

###

© 2015 Adobe Systems Incorporated. All rights reserved. Adobe, the Adobe logo and Creative Cloud are either registered trademarks or trademarks of Adobe Systems Incorporated in the United States and/or other countries. All other trademarks are the property of their respective owners.

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Condensed Consolidated Statements of Income

(In thousands, except per share data; unaudited)

	Three Months Ended						Year Ended
	November 27, 2015			November 28, 2014			November 27, 2015			November 28, 2014
Revenue:
Subscription	$	907,434		$	628,954		$	3,223,904		$	2,076,584
Product	284,496			327,951			1,125,146			1,627,803
Services and support	114,474			116,423			446,461			442,678
Total revenue	1,306,404			1,073,328			4,795,511			4,147,065
Cost of revenue:
Subscription	106,368			87,883			409,194			335,432
Product	24,320			21,930			90,035			97,099
Services and support	70,673			51,130			245,088			189,549
Total cost of revenue	201,361			160,943			744,317			622,080
Gross profit	1,105,043			912,385			4,051,194			3,524,985
Operating expenses:
Research and development	220,514			213,687			862,730			844,353
Sales and marketing	441,472			408,862			1,683,242			1,652,308
General and administrative	134,052			133,534			531,919			543,332
Restructuring and other charges	521			19,385			1,559			19,883
Amortization of purchased intangibles	18,050			12,412			68,649			52,424
Total operating expenses	814,609			787,880			3,148,099			3,112,300
Operating income	290,434			124,505			903,095			412,685
Non-operating income (expense):
Interest and other income (expense), net	22,399			105			33,909			7,267
Interest expense	(16,515		)	(12,678		)	(64,184		)	(59,732		)
Investment gains (losses), net	622			343			961			1,156
Total non-operating income (expense), net	6,506			(12,230		)	(29,314		)	(51,309		)
Income before income taxes	296,940			112,275			873,781			361,376
Provision for income taxes	74,235			24,139			244,230			92,981
Net income	$	222,705		$	88,136		$	629,551		$	268,395
Basic net income per share	$	0.45		$	0.18		$	1.26		$	0.54
Shares used to compute basic net income per share	498,384			498,124			498,764			497,867
Diluted net income per share	$	0.44		$	0.17		$	1.24		$	0.53
Shares used to compute diluted net income per share	506,012			507,451			507,164			508,480

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Condensed Consolidated Balance Sheets

(In thousands, except par value; unaudited)

	November 27, 2015(*)			November 28, 2014
ASSETS
Current assets:
Cash and cash equivalents	$	876,560		$	1,117,400
Short-term investments	3,111,524			2,622,091
Trade receivables, net of allowances for doubtful accounts of $7,293 and $7,867, respectively	672,006			591,800
Deferred income taxes	—			95,279
Prepaid expenses and other current assets	161,802			175,758
Total current assets	4,821,892			4,602,328
Property and equipment, net	787,421			785,123
Goodwill	5,366,881			4,721,962
Purchased and other intangibles, net	510,007			469,662
Investment in lease receivable	80,439			80,439
Other assets	159,832			126,315
Total assets	$	11,726,472		$	10,785,829
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade payables	$	93,307		$	68,377
Accrued expenses	678,364			683,866
Debt and capital lease obligations	—			603,229
Accrued restructuring	1,520			17,120
Income taxes payable	6,165			23,920
Deferred revenue	1,434,200			1,097,923
Total current liabilities	2,213,556			2,494,435
Long-term liabilities:
Debt	1,907,231			911,086
Deferred revenue	51,094			57,401
Accrued restructuring	3,214			5,194
Income taxes payable	256,129			125,746
Deferred income taxes	208,209			342,315
Other liabilities	85,459			73,747
Total liabilities	4,724,892			4,009,924
Stockholders' equity:
Preferred stock, $0.0001 par value; 2,000 shares authorized	—			—
Common stock, $0.0001 par value	61			61
Additional paid-in-capital	4,184,883			3,778,495
Retained earnings	7,253,431			6,924,294
Accumulated other comprehensive income (loss)	(169,080		)	(8,094		)
Treasury stock, at cost(103,025 and 103,350 shares, respectively), net of reissuances	(4,267,715		)	(3,918,851		)
Total stockholders' equity	7,001,580			6,775,905
Total liabilities and stockholders' equity	$	11,726,472		$	10,785,829

^{_________________________________________} 

(*) During the fourth quarter of fiscal 2015, we early-adopted Accounting Standards Update No. 2015-17, Balance Sheet Classification of Deferred Taxes. This standard requires that all deferred tax assets and liabilities, and any related valuation allowance, be classified as non-current on the balance sheets. As of November 27, 2015, our deferred tax assets were netted against non-current deferred income tax liabilities.

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Condensed Consolidated Statements of Cash Flows

(In thousands; unaudited)

	Three Months Ended
	November 27, 2015			November 28, 2014
Cash flows from operating activities:
Net income	$	222,705		$	88,136
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	86,359			78,147
Stock-based compensation expense	81,022			84,950
Gain on sale of property	(21,415		)	—
Unrealized investment gains, net	(662		)	(121		)
Changes in deferred revenue	179,265			158,712
Changes in other operating assets and liabilities	(92,759		)	(10,071		)
Net cash provided by operating activities	454,515			399,753
Cash flows from investing activities:
Purchases, sales and maturities of short-term investments, net	(277,566		)	(8,474		)
Purchases of property and equipment	(64,676		)	(36,775		)
Proceeds from the sale of property	57,779			—
Purchases and sales of long-term investments, intangibles and other assets, net	(1,524		)	(2,908		)
Acquisitions, net of cash	—			(29,802		)
Net cash used for investing activities	(285,987		)	(77,959		)
Cash flows from financing activities:
Purchases of treasury stock	(125,000		)	(125,000		)
Proceeds from reissuance of treasury stock, net	42			3,618
Repayment of debt and capital lease obligations	—			(3,253		)
Excess tax benefits from stock-based compensation	9,808			21,282
Net cash used for financing activities	(115,150		)	(103,353		)
Effect of exchange rate changes on cash and cash equivalents	(6,110		)	(4,370		)
Net increase in cash and cash equivalents	47,268			214,071
Cash and cash equivalents at beginning of period	829,292			903,329
Cash and cash equivalents at end of period	$	876,560		$	1,117,400

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Non-GAAP Results

(In thousands, except per share data)

The following tables show Adobe's GAAP results reconciled to non-GAAP results included in this release.

	Three Months Ended									Year Ended
	November 27, 2015			November 28, 2014			August 28, 2015			November 27, 2015			November 28, 2014
Operating income:
GAAP operating income	$	290,434		$	124,505		$	246,019		$	903,095		$	412,685
Stock-based and deferred compensation expense	81,705			85,025			84,371			338,047			335,856
Restructuring and other charges	521			19,385			(751		)	1,559			19,883
Amortization of purchased intangibles	37,678			31,331			41,041			152,590			127,000
Loss contingency (reversal)	—			—			(10,000		)	(10,000		)	10,000
Non-GAAP operating income	$	410,338		$	260,246		$	360,680		$	1,385,291		$	905,424
Net income:
GAAP net income	$	222,705		$	88,136		$	174,465		$	629,551		$	268,395
Stock-based and deferred compensation expense	81,705			85,025			84,371			338,047			335,856
Restructuring and other charges	521			19,385			(751		)	1,559			19,883
Amortization of purchased intangibles	37,678			31,331			41,041			152,590			127,000
Investment (gains) losses	(622		)	(343		)	1,314			(961		)	(1,156		)
Gain on sale of property assets	(21,415		)	—			—			(21,415		)	—
Loss contingency (reversal)	—			—			(10,000		)	(10,000		)	10,000
Income tax adjustments	(8,674		)	(27,872		)	(15,051		)	(35,826		)	(86,140		)
Non-GAAP net income	$	311,898		$	195,662		$	275,389		$	1,053,545		$	673,838
Diluted net income per share:
GAAP diluted net income per share	$	0.44		$	0.17		$	0.34		$	1.24		$	0.53
Stock-based and deferred compensation expense	0.16			0.17			0.17			0.67			0.65
Restructuring and other charges	—			0.04			—			—			0.04
Amortization of purchased intangibles	0.07			0.06			0.08			0.30			0.24
Gain on sale of property assets	(0.04		)	—			—			(0.04		)	—
Loss contingency (reversal)	—			—			(0.02		)	(0.02		)	0.02
Income tax adjustments	(0.01		)	(0.05		)	(0.03		)	(0.07		)	(0.15		)
Non-GAAP diluted net income per share	$	0.62		$	0.39		$	0.54		$	2.08		$	1.33
Shares used in computing diluted net income per share	506,012			507,451			505,809			507,164			508,480

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Non-GAAP Results (continued)

	Three Months Ended
	November 27, 2015
Effective income tax rate:
GAAP effective income tax rate	25.0	%
Stock-based and deferred compensation expense	(1.0	)
Amortization of purchased intangibles	(0.5	)
Income tax adjustments	(2.5	)
Non-GAAP effective income tax rate	21.0	%

Use of Non-GAAP Financial Information

Adobe continues to provide all information required in accordance with GAAP, but believes evaluating its ongoing operating results may not be as useful if an investor is limited to reviewing only GAAP financial measures. Adobe uses non-GAAP financial information to evaluate its ongoing operations and for internal planning and forecasting purposes. Adobe's management does not itself, nor does it suggest that investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Adobe presents such non-GAAP financial measures in reporting its financial results to provide investors with an additional tool to evaluate Adobe's operating results. Adobe believes these non-GAAP financial measures are useful because they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making. This allows institutional investors, the analyst community and others to better understand and evaluate our operating results and future prospects in the same manner as management.

Adobe's management believes it is useful for itself and investors to review, as applicable, both GAAP information that may include items such as stock-based and deferred compensation expenses, restructuring and other charges, amortization of purchased intangibles and certain activity in connection with technology license arrangements, investment gains and losses and the related tax impact of all of these items, income tax adjustments, the income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes, and the non-GAAP measures that exclude such information in order to assess the performance of Adobe's business and for planning and forecasting in subsequent periods. Whenever Adobe uses such a non-GAAP financial measure, it provides a reconciliation of the non-GAAP financial measure to the most closely applicable GAAP financial measure. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure as detailed above.

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