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Fair Value Measurements | 3 Months Ended
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Mar. 31, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Fair Value Measurements | Fair Value Measurements The fair value of our financial assets and liabilities is determined by reference to market data and other valuation techniques as appropriate. We believe the fair value of our financial instruments, which are principally cash and cash equivalents, restricted cash, accounts receivable, other current assets, accounts payable and accrued liabilities, approximates their recorded values. Our assets and liabilities measured at fair value on a recurring basis are described below. Derivative Financial Instruments We record derivative financial instruments on the balance sheet at their respective fair values. As described in Note 1, during the first quarter of 2018, we adopted ASU 2017-12. As of March 31, 2018, we held the following derivative instruments that were accounted for pursuant to ASC 815: Interest Rate Swap Contracts We currently use interest rate swap contracts as described below to mitigate gains or losses associated with the change in expected cash flows due to fluctuations in interest rates on our variable rate debt. Our interest rate swaps that we held as of December 31, 2017 expired in January 2018. In February 2018, we entered into interest rate swap contracts to hedge a portion of our interest expense associated with our variable rate debt to effectively fix the interest rate that we pay. These interest rate swap contracts are designated as cash flow hedges under ASC 815. We pay interest at a weighted-average fixed rate of 2.4418% and receive interest at a variable rate equal to one-month LIBOR. The total notional amount of interest rate swaps outstanding was $800.0 million as of March 31, 2018. These hedges mature in February 2022. These hedges are highly effective in offsetting changes in our future expected cash flows due to the fluctuation in the one-month LIBOR rate associated with our variable rate debt. Going forward, we expect to qualitatively monitor the effectiveness of these hedges on a quarterly basis in accordance with ASU 2017-12. As a result of the effective matching of the critical terms on our variable rate interest expense being hedged to the hedging instruments being used, we expect these hedges to remain highly effective. All gains and losses from these hedges are recorded in Other comprehensive income (loss) until the future underlying payment transactions occur. Any realized gains or losses resulting from the hedges are recognized (together with the hedged transaction) as interest expense. We estimate the fair value of our interest rate swap contracts by discounting the future cash flows of both the fixed rate and variable rate interest payments based on market yield curves. The inputs used to measure the fair value of our interest rate swap contracts are categorized as Level 2 in the fair value hierarchy. The following table shows the gains and interest expense recognized on our interest rate swap contracts:
|  | Three Months Ended
|  | March 31,
|  | 2018 |  | 2017
Gains recorded in accumulated other comprehensive loss, net of tax |  | $ | (2.6 | ) |  | $ | (2.8 | )
Interest expense recorded related to interest rate swap contracts |  | 0.5 |  |  | 2.1 |
Ineffectiveness recorded in interest expense |  | — |  |  | 0.6 |
We do not expect to reclassify material amounts from accumulated other comprehensive loss to interest expense in the next twelve months. The following table shows the effect of interest rate swap contracts designated as cash flow hedges on the consolidated statements of operations and comprehensive loss:
|  | Three Months Ended
|  | March 31,
|  | 2018
|  | Interest expense
Total amounts of expense line item presented in the statements of operations and comprehensive loss in which the effects of cash flow hedges are recorded |  | $ | (154.8 | )
Hedged item |  | (1.6 | )
Derivative designated as hedging instrument |  | 1.1 |
Cross-Currency Interest Rate Swaps In connection with the February 2018 Refinancing (see Note 11), we entered into certain cross-currency interest rate swap agreements to achieve more attractive interest rates by effectively converting $460.0 million of our fixed-rate U.S. Dollar-denominated 2025 Secured Notes, including the semi-annual interest payments through October 2023, to fixed-rate Euro-denominated debt, with a fixed annual weighted average interest rate of approximately 2.946%. We have designated these cross-currency interest rate swap agreements as a net investment hedge of our investments in certain of our international subsidiaries that use the Euro as their functional currency in order to reduce the volatility in our operating results caused by the changes in foreign currency exchange rates of the Euro relative to the U.S. Dollar. We use the spot method to measure the effectiveness of our net investment hedge. Under this method, for each reporting period, the change in the fair value of the $460.0 million cross-currency interest rate swaps is reported in foreign currency translation gain (loss) in Accumulated Other Comprehensive Loss. The cross-currency basis spread (along with other components of the cross-currency swap's fair value excluded from the spot method effectiveness assessment) are amortized and recorded to interest expense. We evaluate the effectiveness of our net investment hedge at the beginning of each quarter. The following table shows the fair value of our hedges:
| Balance Sheet Line Item |  | March 31, 2018 |  | December 31, 2017
Interest rate swaps (1)(3) | Other assets/(accrued liabilities) |  | $ | 2.6 |  |  | $ | (0.2 | )
Cross-currency interest rate swaps(2)(3) | Other long-term liabilities |  | 20.8 |  |  | — |
(1) The respective gain of $2.6 million for the quarter ended March 31, 2018 is reflected in Derivative financial instrument unrealized gain, net of tax in Other comprehensive income. (2) The respective loss of $20.8 million for the quarter ended March 31, 2018 is reflected in Foreign currency translation loss in Other comprehensive income. (3) The inputs used to measure the fair value of our interest rate swap contracts are categorized as Level 2 in the fair value hierarchy.
Net Investment Non-derivative Hedge - 2026 Secured Euro Notes In February 2018, we designated $125.0 million of our 2026 Secured Euro Notes as a net investment non-derivative hedge of our investments in certain of our international subsidiaries that use the Euro as their functional currency in order to reduce the volatility in our results caused by the changes in foreign currency exchange rates of the Euro relative to the U.S. Dollar. We use the spot method to measure the effectiveness of our net investment non-derivative hedge. Under this method, for each reporting period, the change in the hedged portion of the carrying value of the 2026 Secured Euro Notes due to remeasurement is reported in foreign currency translation gain (loss) in Other comprehensive income, and the remaining remeasurement change is recognized in Loss on remeasurement of debt in our consolidated statements of operations and comprehensive loss. We evaluate the effectiveness of our net investment non-derivative hedge at the beginning of each quarter and the inputs used to measure the fair value of this non-derivative hedge are categorized as Level 2 in the fair value hierarchy. Contingent Considerations In connection with our 2017 acquisitions, we have recorded certain contingent considerations, of which the values are primarily based on reaching certain earnings-based metrics, with a maximum payout of up to $38.5 million. The related liabilities were recorded at fair value on the acquisition date as part of the consideration transferred and are remeasured each reporting period. The inputs used to measure the fair value of our contingent considerations are categorized as Level 3 in the fair value hierarchy. Based on the first quarter of 2018 remeasurement and as a result of changes in significant unobservable inputs primarily consisting of projected earnings-based measures and probability of achievement (categorized as Level 3 in the hierarchy as established by ASC 820), we increased the fair value of certain long-term contingent consideration by $18.0 million, which change was included in Restructuring and other. Contingent considerations as of March 31, 2018 and December 31, 2017 were $25.5 million and $7.5 million, respectively, and are primarily included in other long-term liabilities. We did not have assets and liabilities measured at fair value on a non-recurring basis as of March 31, 2018 other than those acquired as a part of the NYX acquisition (see Note 1) and the fair value of assets held for sale (see Note 7).

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- 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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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