Annual report pursuant to Section 13 and 15(d)

Derivative Instruments and Hedging Activities (Tables)

v3.24.0.1
Derivative Instruments and Hedging Activities (Tables)
 12 Months Ended
Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Summary of Foreign Currency Forward Contracts Outstanding

The tables below provide information about the details of all foreign currency forward contracts that were outstanding as of December 31, 2023 and 2022:

 

 

 

Weighted-
Average
Contract Rate

 

 

Notional
Amount

 

 

Fair Value
Gain (Loss)

 

 

 

(in millions, except weighted-average contract rate)

 

As of December 31, 2023

 

 

 

 

 

 

 

 

 

Buy Chinese yuan sell U.S. dollar

 

 

7.13

 

 

$

21.8

 

 

$

—

 

Buy Danish krone sell U.S. dollar

 

 

6.79

 

 

 

0.9

 

 

 

—

 

Buy Euro sell Chilean peso

 

 

956.26

 

 

 

2.3

 

 

 

—

 

Buy Euro sell British pound

 

 

0.87

 

 

 

1.3

 

 

 

—

 

Buy Euro sell Hong Kong dollar

 

 

8.58

 

 

 

5.8

 

 

 

—

 

Buy Euro sell Indonesian rupiah

 

 

17,045.60

 

 

 

3.9

 

 

 

—

 

Buy Euro sell Kazakhstani tenge

 

 

508.75

 

 

 

8.9

 

 

 

—

 

Buy Euro sell Mexican peso

 

 

20.10

 

 

 

70.0

 

 

 

(2.9

)

Buy Euro sell Peruvian nuevo sol

 

 

4.06

 

 

 

1.1

 

 

 

—

 

Buy Euro sell Taiwan dollar

 

 

34.12

 

 

 

1.0

 

 

 

—

 

Buy Euro sell U.S. dollar

 

 

1.11

 

 

 

19.8

 

 

 

(0.1

)

Buy Euro sell Vietnamese dong

 

 

26,800.00

 

 

 

6.2

 

 

 

—

 

Buy Kazakhstani tenge sell U.S. dollar

 

 

457.70

 

 

 

9.6

 

 

 

—

 

Buy Korean won sell U.S. dollar

 

 

1,296.13

 

 

 

22.2

 

 

 

0.1

 

Buy Mexican peso sell U.S. dollar

 

 

17.18

 

 

 

12.5

 

 

 

0.1

 

Buy Norwegian krone sell U.S. dollar

 

 

10.30

 

 

 

1.8

 

 

 

—

 

Buy Polish zloty sell U.S. dollar

 

 

3.97

 

 

 

1.0

 

 

 

—

 

Buy Romanian leu sell U.S. dollar

 

 

4.54

 

 

 

1.3

 

 

 

—

 

Buy Swedish krona sell U.S. dollar

 

 

10.13

 

 

 

1.1

 

 

 

—

 

Buy Taiwan dollar sell U.S. dollar

 

 

31.05

 

 

 

8.7

 

 

 

0.2

 

Buy U.S. dollar sell Brazilian real

 

 

4.91

 

 

 

7.4

 

 

 

(0.1

)

Buy U.S. dollar sell Colombian peso

 

 

3,970.58

 

 

 

—

 

 

 

—

 

Buy U.S. dollar sell Euro

 

 

1.10

 

 

 

144.2

 

 

 

(1.0

)

Buy U.S. dollar sell British pound

 

 

1.27

 

 

 

1.3

 

 

 

—

 

Buy U.S. dollar sell Indian rupee

 

 

83.30

 

 

 

9.0

 

 

 

—

 

Buy U.S. dollar sell Japanese yen

 

 

143.00

 

 

 

2.6

 

 

 

—

 

Buy U.S. dollar sell Malaysian ringgit

 

 

4.64

 

 

 

7.4

 

 

 

(0.1

)

Buy U.S. dollar sell Mexican peso

 

 

17.18

 

 

 

6.6

 

 

 

(0.1

)

Buy U.S. dollar sell Philippine peso

 

 

55.70

 

 

 

3.6

 

 

 

—

 

Total forward contracts

 

 

 

 

$

383.3

 

 

$

(3.9

)

 

 

 

Weighted-
Average
Contract Rate

 

 

Notional
Amount

 

 

Fair Value
Gain (Loss)

 

 

 

(in millions, except weighted-average contract rate)

 

As of December 31, 2022

 

 

 

 

 

 

 

 

 

Buy British pound sell U.S. dollar

 

 

1.18

 

 

$

1.2

 

 

$

—

 

Buy Chinese yuan sell U.S. dollar

 

 

6.76

 

 

 

67.1

 

 

 

(0.7

)

Buy Danish krone sell U.S. dollar

 

 

7.18

 

 

 

0.8

 

 

 

—

 

Buy Euro sell Australian dollar

 

 

1.58

 

 

 

2.2

 

 

 

—

 

Buy Euro sell British pound

 

 

0.88

 

 

 

2.9

 

 

 

—

 

Buy Euro sell Canadian dollar

 

 

1.45

 

 

 

2.4

 

 

 

—

 

Buy Euro sell Chilean peso

 

 

923.81

 

 

 

5.0

 

 

 

—

 

Buy Euro sell Hong Kong dollar

 

 

8.30

 

 

 

4.1

 

 

 

—

 

Buy Euro sell Indonesian rupiah

 

 

16,539.00

 

 

 

14.8

 

 

 

0.1

 

Buy Euro sell Japanese yen

 

 

140.08

 

 

 

1.8

 

 

 

—

 

Buy Euro sell Kazakhstani tenge

 

 

505.00

 

 

 

1.9

 

 

 

—

 

Buy Euro sell Korean won

 

 

1,349.36

 

 

 

1.1

 

 

 

—

 

Buy Euro sell Malaysian ringgit

 

 

4.70

 

 

 

13.6

 

 

 

—

 

Buy Euro sell Mexican peso

 

 

21.95

 

 

 

58.1

 

 

 

(1.2

)

Buy Euro sell Peruvian nuevo sol

 

 

4.06

 

 

 

1.8

 

 

 

—

 

Buy Euro sell Philippine peso

 

 

58.83

 

 

 

1.8

 

 

 

—

 

Buy Euro sell Taiwan dollar

 

 

32.43

 

 

 

1.3

 

 

 

—

 

Buy Euro sell U.S. dollar

 

 

1.07

 

 

 

42.3

 

 

 

0.2

 

Buy Euro sell Vietnamese dong

 

 

25,485.00

 

 

 

6.9

 

 

 

—

 

Buy Indonesian rupiah sell U.S. dollar

 

 

15,782.00

 

 

 

6.3

 

 

 

0.1

 

Buy Mexican peso sell Euro

 

 

20.76

 

 

 

6.7

 

 

 

—

 

Buy Mexican peso sell U.S. dollar

 

 

19.77

 

 

 

24.8

 

 

 

0.2

 

Buy Norwegian krone sell U.S. dollar

 

 

10.25

 

 

 

1.9

 

 

 

0.1

 

Buy Polish zloty sell U.S. dollar

 

 

4.66

 

 

 

0.8

 

 

 

—

 

Buy Swedish krona sell U.S. dollar

 

 

10.62

 

 

 

1.1

 

 

 

—

 

Buy Taiwan dollar sell U.S. dollar

 

 

30.42

 

 

 

7.3

 

 

 

—

 

Buy U.S. dollar sell Brazilian real

 

 

5.38

 

 

 

2.5

 

 

 

—

 

Buy U.S. dollar sell Chinese yuan

 

 

6.86

 

 

 

50.8

 

 

 

(0.2

)

Buy U.S. dollar sell Colombian peso

 

 

4,784.57

 

 

 

1.7

 

 

 

—

 

Buy U.S. dollar sell Euro

 

 

1.07

 

 

 

196.4

 

 

 

(1.8

)

Buy U.S. dollar sell Indian rupee

 

 

82.58

 

 

 

2.9

 

 

 

—

 

Buy U.S. dollar sell Mexican peso

 

 

20.02

 

 

 

12.4

 

 

 

(0.1

)

Buy U.S. dollar sell Philippine peso

 

 

57.66

 

 

 

4.3

 

 

 

(0.1

)

Total forward contracts

 

 

 

 

$

551.0

 

 

$

(3.4

)
Gains (Losses) Relating to Derivative Instruments Recorded in Other Comprehensive Loss

The following table summarizes gains (losses) relating to derivative instruments recorded in other comprehensive loss during the years ended December 31, 2023, 2022, and 2021:

 

 

 

Amount of (Loss) Gain Recognized in
Other Comprehensive Income (Loss)

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

 

2021

 

 

 

(in millions)

 

Derivatives designated as hedging instruments:

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts relating to inventory and intercompany management fee hedges

 

$

(7.7

)

 

$

(5.5

)

 

$

0.1

 

Interest rate swaps

 

 

—

 

 

 

0.5

 

 

 

—

 
Effect of Cash Flow Hedging Relationships on Condensed Consolidated Statements of Income

The effect of cash flow hedging relationships on the Company’s consolidated statements of income for the years ended December 31, 2023, 2022, and 2021 was as follows:

 

 

 

Location and Amount of (Loss) Gain
Recognized in Income on Cash Flow Hedging Relationships

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

 

Cost of sales

 

 

Selling, general, and administrative expenses

 

 

Interest expense

 

 

 

(in millions)

 

Total amounts presented in the consolidated statements of income

 

$

1,191.0

 

 

$

1,866.0

 

 

$

165.9

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts relating to inventory hedges:

 

 

 

 

 

 

 

 

 

Amount of loss reclassified from accumulated other comprehensive loss to income

 

 

(7.6

)

 

 

—

 

 

 

—

 

Amount of loss excluded from assessment of effectiveness recognized in income

 

 

(5.7

)

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts relating to intercompany management fee hedges:

 

 

 

 

 

 

 

 

 

Amount of loss reclassified from accumulated other comprehensive loss to income

 

 

—

 

 

 

(0.8

)

 

 

—

 

Amount of gain excluded from assessment of effectiveness recognized in income

 

 

—

 

 

 

0.4

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

Interest rate swaps:

 

 

 

 

 

 

 

 

 

Amount of gain reclassified from accumulated other comprehensive loss to income

 

 

—

 

 

 

—

 

 

 

0.3

 

Amount of gain excluded from assessment of effectiveness recognized in income

 

 

—

 

 

 

—

 

 

 

—

 

 

 

 

Location and Amount of (Loss) Gain
Recognized in Income on Cash Flow Hedging Relationships

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

 

Cost of sales

 

 

Selling, general, and administrative expenses

 

 

Interest expense

 

 

 

(in millions)

 

Total amounts presented in the consolidated statements of income

 

$

1,173.6

 

 

$

1,810.4

 

 

$

139.3

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts relating to inventory hedges:

 

 

 

 

 

 

 

 

 

Amount of loss reclassified from accumulated other comprehensive loss to income

 

 

(5.3

)

 

 

—

 

 

 

—

 

Amount of loss excluded from assessment of effectiveness recognized in income

 

 

(6.2

)

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts relating to intercompany management fee hedges:

 

 

 

 

 

 

 

 

 

Amount of gain reclassified from accumulated other comprehensive loss to income

 

 

—

 

 

 

2.1

 

 

 

—

 

Amount of gain excluded from assessment of effectiveness recognized in income

 

 

—

 

 

 

0.4

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

Interest rate swaps:

 

 

 

 

 

 

 

 

 

Amount of gain reclassified from accumulated other comprehensive loss to income

 

 

—

 

 

 

—

 

 

 

0.2

 

Amount of gain excluded from assessment of effectiveness recognized in income

 

 

—

 

 

 

—

 

 

 

—

 

 

 

 

Location and Amount of (Loss) Gain
Recognized in Income on Cash Flow Hedging Relationships

 

 

 

Year Ended December 31,

 

 

 

2021

 

 

 

Cost of sales

 

 

Selling, general, and administrative expenses

 

 

Interest expense

 

 

 

(in millions)

 

Total amounts presented in the consolidated statements of income

 

$

1,239.3

 

 

$

2,012.1

 

 

$

153.1

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts relating to inventory hedges:

 

 

 

 

 

 

 

 

 

Amount of loss reclassified from accumulated other comprehensive loss to income

 

 

(2.4

)

 

 

—

 

 

 

—

 

Amount of loss excluded from assessment of effectiveness recognized in income

 

 

(3.6

)

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts relating to intercompany management fee hedges:

 

 

 

 

 

 

 

 

 

Amount of loss reclassified from accumulated other comprehensive loss to income

 

 

—

 

 

 

(0.2

)

 

 

—

 

Amount of gain excluded from assessment of effectiveness recognized in income

 

 

—

 

 

 

0.1

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

Interest rate swaps:

 

 

 

 

 

 

 

 

 

Amount of loss reclassified from accumulated other comprehensive loss to income

 

 

—

 

 

 

—

 

 

 

(0.9

)

Amount of gain excluded from assessment of effectiveness recognized in income

 

 

—

 

 

 

—

 

 

 

—

 
Gains Relating to Derivative Instruments Not Designated As Hedging Instruments Recorded to Income

The following table summarizes gains (losses) recorded to income relating to derivative instruments not designated as hedging instruments during the December 31, 2023, 2022, and 2021:

 

 

 

Amount of (Loss) Gain Recognized in Income

 

 

 

 

 

Year Ended December 31,

 

 

 

 

 

2023

 

 

2022

 

 

2021

 

 

Location of (Loss) Gain
Recognized in Income

 

 

(in millions)

 

 

 

Derivatives not designated as hedging instruments:

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange currency contracts

 

$

(5.9

)

 

$

(6.5

)

 

$

5.9

 

 

Selling, general, and administrative expenses