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Derivative Instruments and Hedging Activities | 9 Months Ended
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Sep. 30, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Instruments and Hedging Activities | 10. Derivative Instruments and Hedging Activities Commodity Price Risk Management The Company has arrangements with certain customers under which it has a firm commitment to deliver copper-based superconductors at a fixed price. In order to minimize the volatility that fluctuations in the price of copper have on the Company’s sales of these commodities, the Company enters into commodity hedge contracts. As commodity contracts settle, gains (losses) as a result of changes in fair values are adjusted to the contracts with the customers through revenues. Foreign Exchange Rate Risk Management The Company had the following notional amounts outstanding under foreign exchange contracts, cross-currency interest rate swap agreements and long-term debt designated as net investment hedges and the respective fair value of the financial instruments recorded in the consolidated balance sheets as follows (in millions):
|  | September 30, 2023 |  |  | December 31, 2022 |
|  | Notional (in USD) |  |  | Fair Value |  |  | Notional (in USD) |  |  | Fair Value |
Financial instruments designated as hedging instruments: |  |  |  |  |  |  |  |  |  |  |  |
Interest rate cross-currency swap agreements |  |  |  |  |  |  |  |  |  |  |  |
Other current assets |  |  |  |  | $ | 19.3 |  |  |  |  |  | $ | 14.8 |
Other assets |  |  |  |  |  | 18.9 |  |  |  |  |  |  | 23.0 |
Other long-term liabilities |  |  |  |  |  | (15.8 | ) |  |  |  |  |  | (12.2 | )
|  | $ | 382.0 |  |  | $ | 22.4 |  |  | $ | 393.3 |  |  | $ | 25.6 |
Long-term debt |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt |  |  | 810.9 |  |  |  | (20.2 | ) |  |  | 807.6 |  |  |  | (17.0 | )
Total financial instruments designated as hedging instruments |  | $ | 1,192.9 |  |  | $ | 2.2 |  |  | $ | 1,200.9 |  |  | $ | 8.6 |
Financial instruments not designated as hedging instruments: |  |  |  |  |  |  |  |  |  |  |  |
Forward currency contracts |  |  |  |  |  |  |  |  |  |  |  |
Other current assets |  | $ | 45.6 |  |  | $ | 0.1 |  |  | $ | 89.8 |  |  | $ | 0.6 |
Other current liabilities |  |  | 307.3 |  |  |  | (1.7 | ) |  |  | 97.4 |  |  |  | (0.3 | )
Embedded derivatives in purchase and delivery contracts |  |  |  |  |  |  |  |  |  |  |  |
Other current assets |  |  | 7.0 |  |  |  | 0.3 |  |  |  | 15.3 |  |  |  | 0.1 |
Other current liabilities |  |  | 10.3 |  |  |  | (0.1 | ) |  |  | — |  |  |  | — |
Fixed price commodity contracts |  |  |  |  |  |  |  |  |  |  |  |
Other current assets |  |  | — |  |  |  | — |  |  |  | 8.9 |  |  |  | 0.6 |
Other current liabilities |  |  | 0.9 |  |  |  | (0.2 | ) |  |  | — |  |  |  | — |
Total financial instruments not designated as hedging instruments |  | $ | 371.1 |  |  | $ | (1.6 | ) |  | $ | 211.4 |  |  | $ | 1.0 |
Total financial instruments |  | $ | 1,564.0 |  |  | $ | 0.6 |  |  | $ | 1,412.3 |  |  | $ | 9.6 |
In addition, the Company periodically enters into purchase and sales contracts denominated in currencies other than the functional currency of the Company's subsidiaries in the transaction. The Company accounts for these transactions separately valuing the “embedded derivative” component of these contracts. The contracts, denominated in currencies other than the functional currency of the transacting parties, amounted to approximately $17.3 million and $15.3 million for the purchase of products at September 30, 2023 and December 31, 2022 respectively. The Company records the changes in the fair value of these embedded derivatives in interest and other income (expense), net in the consolidated statements of income and comprehensive income. The following is a summary of the gain (loss) included in the consolidated statements of income and comprehensive income related to the financial instruments described above (in millions):
|  |  |  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | Financial Statement Classification |  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Financial instruments not designated as hedging instruments |  |  |  |  |  |  |  |  |  |  |  |  |  |
Forward currency contracts |  | Interest and other income (expense), net |  | $ | (5.5 | ) |  | $ | (2.8 | ) |  | $ | (4.2 | ) |  | $ | (6.9 | )
Embedded derivatives in purchase and delivery contracts |  | Interest and other income (expense), net |  |  | (0.6 | ) |  |  | 0.1 |  |  |  | 0.1 |  |  |  | 0.1 |
|  |  |  |  | (6.1 | ) |  |  | (2.7 | ) |  |  | (4.1 | ) |  |  | (6.8 | )
Financial instruments designated as cash flow hedging instruments |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate cross-currency swap agreements |  | Interest and other income (expense), net |  | $ | 2.7 |  |  | $ | 0.3 |  |  | $ | 7.6 |  |  | $ | (1.3 | )
Financial instruments designated as net investment hedging instruments |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate cross-currency swap agreements |  | Interest and other income (expense), net |  |  | 2.0 |  |  |  | 2.2 |  |  |  | 6.0 |  |  |  | 6.5 |
|  |  |  |  | 4.7 |  |  |  | 2.5 |  |  |  | 13.6 |  |  |  | 5.2 |
Total |  |  |  | $ | (1.4 | ) |  | $ | (0.2 | ) |  | $ | 9.5 |  |  | $ | (1.6 | )
|  |  |  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | Financial Statement Classification |  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Financial instruments designated as cash flow hedging instruments |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate cross-currency swap agreements |  | Accumulated other comprehensive income, net of tax |  | $ | 0.5 |  |  | $ | 7.5 |  |  | $ | 0.1 |  |  | $ | 22.6 |
|  |  |  |  | 0.5 |  |  |  | 7.5 |  |  |  | 0.1 |  |  |  | 22.6 |
Financial instruments designated as net investment hedging instruments |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate cross-currency swap agreements |  | Accumulated other comprehensive income, net of tax |  | $ | 5.5 |  |  | $ | 12.4 |  |  | $ | (2.8 | ) |  | $ | 27.4 |
Long-term debt |  | Accumulated other comprehensive income, net of tax |  |  | 15.5 |  |  |  | 23.0 |  |  |  | (2.4 | ) |  |  | 55.5 |
|  |  |  |  | 21.0 |  |  |  | 35.4 |  |  |  | (5.2 | ) |  |  | 82.9 |
Total |  |  |  | $ | 21.5 |  |  | $ | 42.9 |  |  | $ | (5.1 | ) |  | $ | 105.5 |

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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/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//815/tableOfContent + Details
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