XML 26 R17.htm IDEA: XBRL DOCUMENT
v3.23.1

Derivatives | 3 Months Ended
--- | ---
Apr. 01, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives | Derivatives Interest Rate Swap Agreement In 2018, the Company entered into an interest rate swap agreement (2018 Swap Agreement) with Citizens Bank to hedge its exposure to movements in USD LIBOR on its U.S. dollar-denominated debt. The 2018 Swap Agreement has a $15,000,000 notional value and expires on June 30, 2023. On a quarterly basis, the Company receives three-month USD LIBOR, which is subject to a zero percent floor, and pays a fixed rate of interest of 3.15% plus an applicable margin as defined in the Credit Agreement. The Company designated its 2018 Swap Agreement as a cash flow hedge and structured it to be 100% effective. Unrealized gains and losses related to the fair value of the 2018 Swap Agreement are recorded to AOCI, net of tax. In the event of early termination, the Company will receive from or pay to the counterparty the fair value of the 2018 Swap Agreement, and the unrealized gain or loss outstanding will be recognized in earnings. The counterparty to the 2018 Swap Agreement could demand an early termination of that agreement if the Company were to be in default under the Credit Agreement, or any agreement that amends or replaces the Credit Agreement in which the counterparty is a member, and if it were to be unable to cure the default. See Note 5, Short- and Long-Term Obligations, for further details. Forward Currency-Exchange Contracts The Company uses forward currency-exchange contracts that generally have maturities of twelve months or less to hedge exposures resulting from fluctuations in currency exchange rates. Such exposures result from assets and liabilities that are denominated in currencies other than the functional currencies of the Company's subsidiaries. Forward currency-exchange contracts that hedge forecasted accounts receivable or accounts payable are designated as cash flow hedges and unrecognized gains and losses are recorded to AOCI, net of tax. Deferred gains and losses are recognized in the statement of income in the period in which the underlying transaction occurs. The fair values of forward currency-exchange contracts that are designated as fair value hedges and forward currency-exchange contracts that are not designated as hedges are recognized currently in earnings. Gains and losses reported within SG&A expenses in the accompanying condensed consolidated statement of income associated with the Company's forward currency-exchange contracts that were not designated as hedges were not material for the three-month periods ended April 1, 2023 and April 2, 2022. The following table summarizes the fair value of derivative instruments in the accompanying condensed consolidated balance sheet:
|  |  |  | April 1, 2023 |  | December 31, 2022
|  | Balance Sheet Location |  | Asset (Liability) (a) |  | Notional Amount (b) |  | Asset (Liability) (a) |  | Notional Amount
(In thousands) |  |  |  |  |
Derivatives Designated as Hedging Instruments: |  |  |  |  |  |  |  |
Derivative in an Asset Position: |  |  |  |  |  |  |  |
2018 Swap Agreement |  | Other Current Assets |  | $ | 75 |  |  | $ | 15,000 |  |  | $ | 131 |  |  | $ | 15,000 |
Derivatives in a Liability Position: |  |  |  |  |  |  |  |
Forward currency-exchange contracts |  | Other Current Liabilities |  | $ | (51) |  |  | $ | 430 |  |  | $ | (54) |  |  | $ | 430 |
Derivatives Not Designated as Hedging Instruments: |  |  |  |  |  |  |  |
Derivatives in an Asset Position: |  |  |  |  |  |  |  |
Forward currency-exchange contracts |  | Other Current Assets |  | $ | 2 |  |  | $ | 189 |  |  | $ | 15 |  |  | $ | 647 |
(a) See Note 9, Fair Value Measurements and Fair Value of Financial Instruments, for the fair value measurements relating to these financial instruments. (b) The 2023 notional amounts are indicative of the level of the Company's recurring derivative activity. The following table summarizes the activity in AOCI associated with the Company's derivative instruments designated as cash flow hedges as of and for the three months ended April 1, 2023:
(In thousands) |  | Interest Rate Swap Agreement |  | Forward Currency- Exchange Contract |  | Total
Unrealized Gain (Loss), Net of Tax, at December 31, 2022 |  | $ | 99 |  |  | $ | (41) |  |  | $ | 58 |
Gain reclassified to earnings (a) |  | (46) |  |  | — |  |  | (46) |
Gain recognized in AOCI |  | 4 |  |  | 3 |  |  | 7 |
Unrealized Gain (Loss), Net of Tax, at April 1, 2023 |  | $ | 57 |  |  | $ | (38) |  |  | $ | 19 |
(a) See Note 7, Accumulated Other Comprehensive Items, for the income statement classification. As of April 1, 2023, the Company expects to reclassify gains of $19,000 from AOCI to earnings over the next twelve months based on the estimated cash flows of the 2018 Swap Agreement and the maturity date of the forward currency-exchange contract.

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 https://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 https://asc.fasb.org/extlink&oid=126731327&loc=d3e90205-114008 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration