XML 43 R26.htm IDEA: XBRL DOCUMENT
v3.22.0.1

Derivative Financial Instruments | 12 Months Ended
--- | ---
Dec. 26, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Financial Instruments | Derivative Financial Instruments Hasbro uses foreign currency forward contracts to mitigate the impact of currency rate fluctuations on firmly committed and projected future foreign currency transactions. These over-the-counter contracts, which hedge future currency requirements related to purchases of inventory, product sales, television and film production cost and production financing loans (see note 11) as well as other cross-border transactions not denominated in the functional currency of the business unit, are primarily denominated in United States and Hong Kong dollars, and Euros. All contracts are entered into with a number of counterparties, all of which are major financial institutions. The Company believes that a default by a single counterparty would not have a material adverse effect on the financial condition of the Company. Hasbro does not enter into derivative financial instruments for speculative purposes. Cash Flow Hedges All of the Company’s designated foreign currency forward contracts are considered to be cash flow hedges. These instruments hedge a portion of the Company’s currency requirements associated with anticipated inventory purchases, product sales, certain production financing loans and other cross-border transactions, primarily in years 2022 and 2023, and to a lesser extent, 2024. At December 26, 2021 and December 27, 2020, the notional amounts and fair values of the Company’s foreign currency forward contracts designated as cash flow hedging instruments were as follows:
| 2021 |  | 2020
(In millions) | Notional Amount |  | Fair Value |  | Notional Amount |  | Fair Value
Hedged transaction |  |  |  |  |  |  |
Inventory purchases | 199.1 |  |  | 10.4 |  |  | 316.8 |  |  | (10.0) |
Sales | 104.5 |  |  | (1.9) |  |  | 111.6 |  |  | 1.3 |
Production financing and other | 217.0 |  |  | 2.3 |  |  | 89.9 |  |  | 0.4 |
Total | $ | 520.6 |  |  | 10.8 |  |  | 518.3 |  |  | (8.3) |
The Company has a master agreement with each of its counterparties that allows for the netting of outstanding forward contracts. The fair values of the Company’s foreign currency forward contracts designated as cash flow hedges are recorded in the consolidated balance sheets at December 26, 2021 and December 27, 2020 as follows:
(In millions) | 2021 |  | 2020
Prepaid expenses and other current assets |  |  |
Unrealized gains | $ | 13.8 |  |  | 2.3 |
Unrealized losses | (3.1) |  |  | (1.6) |
Net unrealized gains | $ | 10.7 |  |  | 0.7 |
Other assets |  |  |
Unrealized gains | $ | 0.2 |  |  | 1.1 |
Unrealized losses | — |  |  | — |
Net unrealized gains | $ | 0.2 |  |  | 1.1 |
Accrued liabilities |  |  |
Unrealized gains | $ | — |  |  | 3.0 |
Unrealized losses | (0.1) |  |  | (12.9) |
Net unrealized losses | $ | (0.1) |  |  | (9.9) |
Other liabilities |  |  |
Unrealized gains | $ | — |  |  | — |
Unrealized losses | — |  |  | (0.2) |
Net unrealized losses | $ | — |  |  | (0.2) |
Net gains (losses) on cash flow hedging activities have been reclassified from other comprehensive earnings (loss) to net earnings for the years ended December 26, 2021, December 27, 2020 and December 29, 2019 as follows:
(In millions) | 2021 |  | 2020 |  | 2019
Consolidated Statements of Operations Classification |  |  |  |  |
Cost of sales | $ | (4.7) |  |  | 21.2 |  |  | 16.7 |
Net revenues | 1.0 |  |  | 2.9 |  |  | 5.6 |
Other | 2.0 |  |  | 1.2 |  |  | 0.2 |
Net realized (losses) gains | $ | (1.7) |  |  | 25.3 |  |  | 22.5 |
Undesignated Hedges The Company also enters into foreign currency forward contracts to minimize the impact of changes in the fair value of intercompany loans due to foreign currency changes. The Company does not use hedge accounting for these contracts as changes in the fair values of these contracts are substantially offset by changes in the fair value of the intercompany loans. Additionally, to manage transactional exposure to fair value movements on certain monetary assets and liabilities denominated in foreign currencies, the Company has implemented a balance sheet hedging program. The Company does not use hedge accounting for these contracts as changes in the fair values of these contracts are offset by changes in the fair value of the balance sheet items. As of December 26, 2021 and December 27, 2020, the total notional amounts of the Company’s undesignated derivative instruments were $632.0 million and $590.6 million, respectively. At December 26, 2021 and December 27, 2020, the fair value of the Company’s undesignated derivative financial instruments are recorded in the consolidated balance sheets as follows:
(In millions) | 2021 |  | 2020
Prepaid expenses and other current assets |  |  |
Unrealized gains | $ | — |  |  | 3.5 |
Unrealized losses | — |  |  | (0.5) |
Net unrealized gains | $ | — |  |  | 3.0 |
Accrued liabilities |  |  |
Unrealized gains | $ | 3.5 |  |  | — |
Unrealized losses | (6.0) |  |  | (2.6) |
Net unrealized losses | $ | (2.5) |  |  | (2.6) |
Total unrealized (losses) gains, net | $ | (2.5) |  |  | 0.4 |
The Company recorded net gains (losses) gains of $4.6 million, $(27.7) million and $13.4 million on these instruments to other (income) expense, net for 2021, 2020 and 2019, respectively, relating to the change in fair value of such derivatives, substantially offsetting gains and losses from the change in fair value of intercompany loans to which the instruments relate. eOne Purchase Hedges During the third quarter of 2019, the Company hedged a portion of its exposure to fluctuations in the British pound sterling and other transactions in relation to the eOne acquisition using a series of both foreign exchange forward and option contracts. These contracts did not qualify for hedge accounting and as such, were marked to market through the Company's Consolidated Statement of Operations. For tax purposes these contracts qualified as nontaxable integrated tax hedges. The Company recorded realized gains of $80.0 million on matured contracts to other (income) expense, net for the year ended December 29, 2019. These contracts matured on December 30, 2019 (the closing date of the transaction) and the related net gains or losses recognized in the Company's 2020 results were immaterial to the Company's consolidated financial statements. For additional information related to the Company’s derivative financial instruments see notes 4 and 14.

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

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 40 -Section 50 -Paragraph 5 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123477628&loc=d3e90205-114008 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration