v3.19.3.a.u2

Fair value of financial instruments | 12 Months Ended
--- | ---
Dec. 31, 2019
Fair value of financial instruments |
Fair value of financial instruments | 14. Fair value of financial instruments The estimated carrying values and fair values of our recorded financial instruments related to operations are as follows:
|  | December 31, |
|  | 2019 |  | 2018 |
|  | Carrying |  |  |  | Carrying |  |  |
|  | Amount |  | Fair Value |  | Amount |  | Fair Value |
Cash and cash equivalents |  | $ | 74.9 |  | $ | 74.9 |  | $ | 68.3 |  | $ | 68.3 |
Restricted cash |  |  | 7.7 |  |  | 7.7 |  |  | 2.1 |  |  | 2.1 |
Derivative assets current |  |  | 0.7 |  |  | 0.7 |  |  | 4.2 |  |  | 4.2 |
Derivative assets non-current |  |  | — |  |  | — |  |  | 0.3 |  |  | 0.3 |
Derivative liabilities current |  |  | 12.0 |  |  | 12.0 |  |  | 4.5 |  |  | 4.5 |
Derivative liabilities non-current |  |  | 15.9 |  |  | 15.9 |  |  | 15.4 |  |  | 15.4 |
Long-term debt, including current portion |  |  | 560.4 |  |  | 589.5 |  |  | 625.0 |  |  | 607.6 |
Convertible debentures |  |  | 88.5 |  |  | 93.0 |  |  | 102.4 |  |  | 101.8 |
Our financial instruments that are recorded at fair value have been classified into levels using a fair value hierarchy. The three levels of the fair value hierarchy are defined below: Level 1—Unadjusted quoted prices available in active markets for identical assets or liabilities as of the reporting date. Financial assets utilizing Level 1 inputs include active exchange‑traded securities. Level 2—Quoted prices available in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are directly observable, and inputs derived principally from market data. Level 3—Unobservable inputs from objective sources. These inputs may be based on entity‑specific inputs. Level 3 inputs include all inputs that do not meet the requirements of Level 1 or Level 2. The following represents the recurring measurements of fair value hierarchy of our financial assets and liabilities that were recognized at fair value as of December 31, 2019 and December 31, 2018. Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement.
|  | December 31, 2019 |
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 74.9 |  | $ | — |  | $ | — |  | $ | 74.9 |
Restricted cash |  |  | 7.7 |  |  | — |  |  | — |  |  | 7.7 |
Derivative instruments asset |  |  | — |  |  | 0.7 |  |  | — |  |  | 0.7 |
Total |  | $ | 82.6 |  | $ | 0.7 |  | $ | — |  | $ | 83.3 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative instruments liability |  | $ | — |  | $ | 24.7 |  | $ | 3.2 |  | $ | 27.9 |
Total |  | $ | — |  | $ | 24.7 |  | $ | 3.2 |  | $ | 27.9 |
|  | December 31, 2018 |
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 68.3 |  | $ | — |  | $ | — |  | $ | 68.3 |
Restricted cash |  |  | 2.1 |  |  | — |  |  | — |  |  | 2.1 |
Derivative instruments asset |  |  | — |  |  | 4.5 |  |  | — |  |  | 4.5 |
Total |  | $ | 70.4 |  | $ | 4.5 |  | $ | — |  | $ | 74.9 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative instruments liability |  | $ | — |  | $ | 18.7 |  | $ | 1.2 |  | $ | 19.9 |
Total |  | $ | — |  | $ | 18.7 |  | $ | 1.2 |  | $ | 19.9 |
For cash and cash equivalents and restricted cash, the carrying amount approximates fair value because of the short-term maturity of those instruments and are classified as Level 1 within the fair value hierarchy. The fair values of our derivative instruments are based upon trades in liquid markets. Valuation model inputs can generally be verified and valuation techniques do not involve significant judgment. The fair values of such financial instruments are classified within Level 2 of the fair value hierarchy. We use our best estimates to determine the fair value of commodity and derivative contracts we hold. These estimates consider various factors including closing exchange prices, time value, volatility factors and credit exposure. The fair value of each contract is discounted using a risk free interest rate. We also adjust the fair value of financial assets and liabilities to reflect credit risk, which is calculated based on our credit rating and the credit rating of our counterparties. As of December 31, 2019, the credit valuation adjustments resulted in a $1.1 million net increase in fair value, which consists of a $0.1 million pre‑tax gain in other comprehensive income and a $1.0 million gain in change in fair value of derivative instruments. As of December 31, 2018, the credit valuation adjustments resulted in a $1.0 million net increase in fair value, which consists of a $0.1 million pre‑tax gain in other comprehensive income and a $0.9 million gain in change in fair value of derivative instruments. The carrying amounts for cash and cash equivalents and restricted cash approximate fair value due to their short‑term nature. The fair value of long‑term debt and convertible debentures was determined using quoted market prices, as well as discounting the remaining contractual cash flows using a rate at which we could issue debt with a similar maturity as of the balance sheet date. The conversion option derivative for the Series E Debentures is classified within Level 3 of the fair value hierarchy. The significant unobservable inputs used in developing fair value include the volatility of our common shares and the fair value of the host contract, which is derived from recent similar convertible debenture offerings from peer companies. A discounted cash flow valuation technique is utilized to calculate to fair value of the conversion option derivative. The following table reconciles, for the year ended December 31, 2019, the beginning and ending balances for the conversion option derivative liability that is recognized at fair value in the consolidated financial statements, using significant unobservable inputs:
|  | Fair value Measurement Using Significant Unobservable Inputs (Level 3)
|  | Year Ended
|  | December 31, 2019
Beginning balance of liability at January 1, 2019 |  | $ | 1.2
Total unrealized loss |  |  | 1.8
Currency transaction loss |  |  | 0.2
Ending balance of liability at December 31, 2019 |  | $ | 3.2

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration