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Derivative Instruments

3 Months Ended

Jun. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative Instruments

Changes in interest rates expose us to risks. To help us manage these risks, in January 2020 we entered into two interest rate swaps to hedge a total of $400.0 million of our variable interest debt. One swap settled on January 31, 2021 and, as of June 30, 2021, one interest rate swap to hedge $200.0 million remained outstanding. The fair value of this interest rate swap is reflected in our Consolidated Balance Sheets in other accrued liabilities. We do not use derivatives for trading purposes.

The following tables summarize the fair values of our derivative instrument as of the end of the periods shown:

						June 30, 2021
(In thousands)						Hedge Type						Final Settlement Date						Notional Amount						Other Accrued Liabilities						Other Long-Term Liabilities
Interest rate swap						Cash flow						1/31/2022						$	200,000					(1,688)						—
Total fair value																								$	(1,688)					$	—

						March 31, 2021
(In thousands)						Hedge Type						Final Settlement Date						Notional Amount						Other Accrued Liabilities						Other Long-Term Liabilities
Interest rate swap						Cash flow						1/31/2022						$	200,000					(2,363)						—
Total fair value																								$	(2,363)					$	—

The following table summarizes our interest rate swaps, net of tax, for the periods shown:

																		Three Months Ended June 30,
(In thousands)						Location																		2021						2020
Gain Recognized in Other Comprehensive Loss (effective portion)						Other comprehensive income (loss)																		$	520					$	309
Loss Reclassified from Accumulated Other Comprehensive Loss into Income						Interest expense																		$	(718)					$	(1,026)

We expect pre-tax losses of $1.7 million associated with interest rate swaps, currently reported in accumulated other comprehensive loss, to be reclassified into income over the next twelve months. The amount ultimately realized, however, will differ as interest rates change and the underlying contracts settle.

Counterparty Credit Risk:Interest rate swaps expose us to counterparty credit risk for non-performance. We manage our exposure to counterparty credit risk by only dealing with counterparties who are substantial international financial institutions with significant experience using such derivative instruments.

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- References

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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

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