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Derivative Instruments and Hedging Activities | 12 Months Ended
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Sep. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company uses derivative instruments to mitigate certain exposures. The Company does not enter into derivative financial instruments for trading or speculative purposes. The effects these derivative instruments and hedged items had on the Company’s balance sheets and the fair values of the derivatives outstanding at September 30, 2025 and 2024 were not material. The effects on the Company’s financial performance and cash flows are provided below. Foreign Currency Risks and Related Strategies The Company has foreign currency exposures throughout Europe, Greater Asia, Canada and Latin America. Transactional currency exposures that arise from entering into transactions, generally on an intercompany basis, in non-hyperinflationary countries that are denominated in currencies other than the functional currency are mitigated primarily through the use of forward contracts. In order to mitigate transactional foreign currency exposures resulting from anticipated intercompany purchases and sales denominated in a currency other than local functional currencies, the Company has hedged a portion of this currency risk with certain instruments such as foreign exchange forward and option contracts, which are designated as cash flow hedges. In order to mitigate foreign currency exposure relating to its investments in certain foreign subsidiaries, the Company has hedged the currency risk associated with those investments with certain instruments such as foreign currency-denominated debt and cross-currency swaps, which are designated as net investment hedges, as well as currency exchange contracts. The notional amounts of the Company’s foreign currency-related derivative instruments as of September 30, 2025 and 2024 were as follows:
(Millions of dollars) | Hedge Designation |  | 2025 |  | 2024
Foreign exchange contracts (a) | Undesignated |  | $ | 5,710 |  |  | $ | 4,521 |
Foreign exchange contracts (b) | Cash flow hedges |  | 1,170 |  |  | 543 |
Foreign currency-denominated debt (c) | Net investment hedges |  | 2,630 |  |  | 3,065 |
Cross-currency swaps (d) | Net investment hedges |  | 1,054 |  |  | 1,366 |
(a)Represents hedges of transactional foreign exchange exposures resulting primarily from intercompany payables and receivables. Gains and losses on these instruments are recognized immediately in income. These gains and losses are largely offset by gains and losses on the underlying hedged items, as well as the hedging costs associated with the derivative instruments. Net amounts recognized in Other expense, net, during the years ending September 30, 2025, 2024 and 2023 are detailed in Note 19. (b)Represents foreign exchange contracts related to anticipated intercompany purchases and sales, which generally have durations of less than eighteen months. (c)Represents foreign currency-denominated long-term notes outstanding, which were effective as economic hedges of net investments in certain of the Company's foreign subsidiaries. (d)Represents cross-currency swaps, which were effective as economic hedges of net investments in certain of the Company’s foreign subsidiaries. Net gains or losses resulting from the change in fair value of the foreign exchange contracts designated as cash flow hedges are initially recorded within Other comprehensive income (loss) and reclassified into earnings upon the occurrence of the related underlying third-party transaction. If foreign exchange contracts designated as cash flow hedges are terminated prematurely as a result of the hedged transaction being probable of not occurring, the balance in Accumulated other comprehensive income (loss) attributable to those derivatives is immediately reclassified into Revenues or Cost of products sold (depending on whether the hedged item is an intercompany sale or purchase). Net after tax gains of $27 million were recognized in Other comprehensive income (loss) during 2025, and amounts recognized during 2024 were immaterial. Amounts reclassified from Accumulated other comprehensive income (loss) into earnings relating to these cash flow hedges were immaterial during 2025, and no amounts were reclassified from Accumulated other comprehensive income (loss) into earnings relating to these cash flow hedges during 2024. The Company did not have foreign exchange contracts designated as cash flow hedges during 2023. The amounts expected to be reclassified from accumulated other comprehensive income into earnings within the next 12 months are not material to the Company's consolidated financial results. Net gains or losses relating to the net investment hedges, which are attributable to changes in the foreign currencies to U.S. dollar spot exchange rates, are recorded as foreign currency translation in Other comprehensive income (loss), net of tax. Upon the termination of a net investment hedge, any net gain or loss included in Accumulated other comprehensive income (loss) relative to the investment hedge remains until the foreign subsidiary investment is disposed of or is substantially liquidated. Net losses recorded to Accumulated other comprehensive income (loss) relating to the Company’s net investment hedges as of September 30, 2025, 2024 and 2023 were as follows:
(Millions of dollars) | 2025 |  | 2024 |  | 2023
Foreign currency-denominated debt | (107) |  |  | (96) |  |  | (155) |
Cross-currency swaps (a) | (18) |  |  | (71) |  |  | (70) |
(a)The amounts in 2025, 2024 and 2023 include net of tax (losses) gains recognized on terminated cross-currency swaps of $(42) million, $9 million, and $13 million, respectively. Interest Rate Risks and Related Strategies The Company uses a mix of fixed and variable rate debt, which is further discussed in Note 16, to manage its interest rate exposure, and periodically uses interest rate swaps to manage such exposures. Under these interest rate swaps, the Company exchanges, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount. These swaps are designated as either cash flow or fair value hedges. Changes in the fair value of the interest rate swaps designated as cash flow hedges (i.e., hedging the exposure to variability in expected future cash flows that is attributable to a particular risk) are recorded in Other comprehensive income (loss), net of tax. If interest rate derivatives designated as cash flow hedges are terminated, the balance in Accumulated other comprehensive income (loss) attributable to those derivatives is reclassified into earnings, within Interest expense, over the remaining life of the hedged debt. The amounts reclassified from Accumulated other comprehensive income (loss) relating to cash flow hedges during 2025, 2024 and 2023, as well as the amounts expected to be reclassified within the next 12 months, are not material to the Company’s consolidated financial results. Net after-tax (losses) gains were recorded in Other comprehensive income (loss) relating to interest rate cash flow hedges of $(10) million, and $23 million in fiscal years 2024 and 2023, respectively. Net after-tax gains (losses) recorded in Other comprehensive income relating to interest rate cash flow hedges during fiscal year 2024 included a net after-tax gain of $67 million that was realized upon the Company’s termination of its forward starting interest rate swaps in fiscal year 2024. For interest rate swaps designated as fair value hedges (i.e., hedges against the exposure to changes in the fair value of an asset or a liability or an identified portion thereof that is attributable to a particular risk), changes in the fair value of the interest rate swaps offset changes in the fair value of the fixed rate debt due to changes in market interest rates. Amounts recorded during the years ended September 30, 2025 and 2024 were immaterial to the Company’s consolidated financial results. The notional amounts of the Company’s interest rate-related derivative instruments as of September 30, 2025 and 2024 were as follows:
(Millions of dollars) | Hedge Designation |  | 2025 |  | 2024
Interest rate swaps (a) | Fair value hedges |  | $ | 700 |  |  | $ | 700 |
(a)Represents fixed-to-floating interest rate swap agreements the Company entered into to convert the interest payments on certain long-term notes from the fixed rate to a floating interest rate based on secured overnight financing rates (“SOFR”). Other Risk Exposures The Company purchases resins, which are oil-based components used in the manufacture of certain products. Significant increases in world oil prices that lead to increases in resin purchase costs could impact future operating results. From time to time, the Company has managed price risks associated with these commodity purchases through commodity derivative forward contracts. The Company’s commodity derivative forward contracts at September 30, 2025 and 2024 were immaterial to the Company's consolidated financial results.

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