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Derivative Instruments | 9 Months Ended
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Sep. 30, 2021
Derivative Instrument Detail [Abstract] |
Derivative Instruments | NO TE 6. DERIVATIVE INSTRUMENTS From time to time, we enter into derivative financial instruments to manage certain cash flow and fair value risks. Derivatives designated and qualifying as a hedge of the exposure to variability in the cash flows of a specific asset or liability that is attributable to a particular risk, such as interest rate risk, are considered cash flow hedges. As of September 30, 2021, we have interest rate swaps associated with $403.5 million of term loan debt. These swaps are cash flow hedges that convert variable rates ranging from three-month and one-month LIBOR plus 1.85% to 2.10%, to fixed rates ranging from 3.04% to 4.77%. Our cash flow hedges are expected to be highly effective in achieving offsetting cash flows attributable to the hedged interest rate risk through the term of the hedges. At September 30, 2021, the amount of net losses expected to be reclassified into earnings in the next 12 months is approximately $8.0 million. However, this expected amount to be reclassified into earnings is subject to volatility as the ultimate amount recognized in earnings is based on the LIBOR rate at the time of net swap cash payments. We also hold $607.5 million of forward starting interest rate swaps designated as cash flow hedges. These forward starting interest rate swaps effectively hedge the variability in future benchmark interest payments attributable to changes in interest rates on $607.5 million of future debt refinances through January 2029 by converting the benchmark interest rates to fixed interest rates. In addition, the cash flow hedges for future debt refinances require settlement on the stated maturity date. At September 30, 2021, we have recorded derivative assets of $40.8 million associated with these forward starting interest rate swaps. The following table presents the gross fair values of derivative instruments on our Condensed Consolidated Balance Sheets:
|  |  |  | Asset Derivatives |  |  |  |  | Liability Derivatives |
(in thousands) |  | Location |  | September 30, 2021 |  |  | December 31, 2020 |  |  | Location |  | September 30, 2021 |  |  | December 31, 2020 |
Derivatives designated in cash flow hedging relationships: |  |  |  |  |  |  |  |  |
Interest rate contracts |  | Other assets, current 1 |  | $ | 1,890 |  |  | $ | 63 |  |  | Accounts payable and accrued liabilities 1 |  | $ | 189 |  |  | $ | 1,010 |
Interest rate contracts |  | Other assets, non-current |  |  | 40,480 |  |  |  | 18,466 |  |  | Other long-term obligations |  |  | 27,933 |  |  |  | 45,100 |
|  |  |  | $ | 42,370 |  |  | $ | 18,529 |  |  |  |  | $ | 28,122 |  |  | $ | 46,110 |
1 | Derivative instruments that mature within one year, as a whole, are classified as current.
The following table details the effect of derivatives on our Condensed Consolidated Statements of Operations:
|  |  |  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
(in thousands) |  | Location |  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
Derivatives designated in cash flow hedging relationships: |  |  |  |  |  |  |  |  |  |
Interest rate contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |
Income (loss) recognized in other comprehensive income, net of tax |  |  |  | $ | 4,310 |  |  | $ | 8,920 |  |  | $ | 32,741 |  |  | $ | (34,112 | )
Amounts reclassified from accumulated other comprehensive loss, net of tax 1 |  | Interest expense |  | $ | (2,326 | ) |  | $ | (2,412 | ) |  | $ | (6,839 | ) |  | $ | (5,072 | )
Interest expense, net |  |  |  | $ | 8,641 |  |  | $ | 8,557 |  |  | $ | 20,414 |  |  | $ | 20,594 |
1 | Realized losses on interest rate contracts consist of net cash received or paid and interest accruals on the interest rate swaps during the periods. Net cash received or paid is included in the supplemental cash flow information within interest, net of amounts capitalized in the Condensed Consolidated Statements of Cash Flows.

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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://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
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