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FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | 12 Months Ended
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Oct. 31, 2022
Fair Value Disclosures [Abstract] |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS Recurring Fair Value Measurements The following table presents the fair value of those assets and (liabilities) measured on a recurring basis as of October 31, 2022 and 2021:
| October 31, 2022
| Assets |  | Liabilities
(in millions) | Level 1 |  | Level 2 |  | Level 3 |  | Total |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Interest rate derivatives | $ | — |  |  | $ | 72.1 |  |  | $ | — |  |  | $ | 72.1 |  |  | $ | — |  |  | $ | (1.0) |  |  | $ | — |  |  | $ | (1.0) |
Foreign exchange hedges | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (0.2) |  |  | — |  |  | (0.2) |
Insurance annuity | — |  |  | — |  |  | 17.8 |  |  | 17.8 |  |  | — |  |  | — |  |  | — |  |  | — |
Cross currency swap | — |  |  | 46.8 |  |  | — |  |  | 46.8 |  |  | — |  |  | — |  |  | — |  |  | — |
| October 31, 2021
| Assets |  | Liabilities
(in millions) | Level 1 |  | Level 2 |  | Level 3 |  | Total |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Interest rate derivatives | $ | — |  |  | $ | 7.6 |  |  | $ | — |  |  | $ | 7.6 |  |  | $ | — |  |  | $ | (16.8) |  |  | $ | — |  |  | $ | (16.8) |
Foreign exchange hedges | — |  |  | 0.1 |  |  | — |  |  | 0.1 |  |  | — |  |  | (0.1) |  |  | — |  |  | (0.1) |
Insurance annuity | — |  |  | — |  |  | 20.9 |  |  | 20.9 |  |  | — |  |  | — |  |  | — |  |  | — |
Cross currency swap | — |  |  | 10.2 |  |  | — |  |  | 10.2 |  |  | — |  |  | (1.2) |  |  | — |  |  | (1.2) |
The carrying amounts of cash and cash equivalents, trade accounts receivable, accounts payable, current liabilities and short-term borrowings as of October 31, 2022 and 2021 approximate their fair values because of the short-term nature of these items and are not included in this table. Interest Rate Derivatives As of October 31, 2022, the Company has various interest rate swaps with a total notional amount of $1,150.0 million, maturing between March 11, 2024 and July 15, 2029. The Company will receive variable rate interest payments based upon one-month U.S. dollar SOFR, and in return the Company will be obligated to pay interest at a weighted average fixed interest rate of 2.50%. This effectively will convert the borrowing rate on an amount of debt equal to the notional amount of the interest rate swaps from a variable rate to a fixed rate. The Company is actively monitoring the interest rate market and will execute new interest rate swaps as appropriate. Subsequent to October 31, 2022, the Company entered into $100.0 million of additional interest rate swaps maturing March 1, 2028. These derivatives are designated as cash flow hedges for accounting purposes. Accordingly, the gain or loss on these derivative instruments are reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period during which the hedged transaction affects earnings. See Note 14 herein for additional disclosures of the aggregate gain or loss included within other comprehensive income. The assumptions used in measuring fair value of these interest rate derivatives are considered level 2 inputs, which are based upon observable market rates, including SOFR and interest paid based upon a designated fixed rate over the life of the swap agreements. Losses reclassified to earnings under these contracts were $8.4 million, $18.1 million and $16.5 million for the year ended October 31, 2022, 2021 and 2020. A derivative gain of $26.1 million, based upon interest rates at October 31, 2022, is expected to be reclassified from accumulated other comprehensive income (loss) to earnings in the next twelve months. Foreign Exchange Hedges The Company conducts business in various international currencies and is subject to risks associated with changing foreign exchange rates. The Company’s objective is to reduce volatility associated with foreign exchange rate changes. Accordingly, the Company enters into various contracts that change in value as foreign exchange rates change to protect the value of certain existing foreign currency assets and liabilities, commitments and anticipated foreign currency cash flows. As of October 31, 2022, the Company had outstanding foreign currency forward contracts in the notional amount of $132.1 million ($81.8 million as of October 31, 2021). Adjustments to fair value are recognized in earnings, offsetting the impact of the hedged profits. The assumptions used in measuring fair value of foreign exchange hedges are considered level 2 inputs, which were based on observable market pricing for similar instruments, principally foreign exchange futures contracts. Realized gains (losses) recorded in other expense, net under fair value contracts were $(6.2) million, $0.4 million and $(3.2) million for the years ended October 31, 2022, 2021 and 2020, respectively. Unrealized net loss recognized by the Company in other expense, net was $0.2 million, zero and $0.1 million for the years ended October 31, 2022, 2021 and 2020, respectively. Cross Currency Swap As of October 31, 2022, the Company has various cross currency interest rate swaps that synthetically swap $334.4 million of fixed rate debt to Euro denominated fixed rate debt. The Company receives a weighted average rate of 1.56% on these swaps. These agreements are designated as either net investment hedges or cash flow hedges for accounting purposes and will mature between March 6, 2023 and October 5, 2026. The gain or loss on the net investment hedge derivative instruments is included in the foreign currency translation component of other comprehensive income until the net investment is sold, diluted, or liquidated. See Note 14 herein for additional disclosure of the aggregate gain or loss included within other comprehensive income. The gain or loss on the cash flow hedge derivative instruments is included in the unrealized foreign exchange component of other expense, offset by the underlying gain or loss on the underlying cash flows that are being hedged. Interest payments received for the cross currency swap are excluded from the net investment hedge effectiveness assessment and are recorded in interest expense, net on the consolidated statements of income. The assumptions used in measuring fair value of the cross currency swap are considered level 2 inputs, which are based upon the Euro to United States dollar exchange rate market. For the years ended October 31, 2022, 2021 and 2020, gains recorded in interest expense, net under the cross currency swap agreements were $5.8 million, $2.2 million and $2.4 million, respectively. Other Financial Instruments The fair values of the Company’s 2022 Credit Agreement, the U.S. Receivables Facility and European RFA do not materially differ from carrying value as the Company’s cost of borrowing is variable and approximates current borrowing rates. The fair values of the Company’s long-term obligations are estimated based on either the quoted market prices for the same or similar issues or the current interest rates offered for the debt of the same remaining maturities, which are considered level 2 inputs in accordance with ASC Topic 820, “Fair Value Measurements and Disclosures.” Pension Plan Assets On an annual basis the Company compares the asset holdings of its pension plan to targets it previously established. The pension plan assets are categorized as equity securities, debt securities, fixed income securities, insurance annuities or other assets, which are considered level 1, level 2 and level 3 fair value measurements. The typical asset holdings include: •Common stock: Valued based on quoted prices and are primarily exchange-traded. •Mutual funds: Valued at the Net Asset Value (“NAV”) available daily in an observable market. •Common collective trusts: Unit value calculated based on the observable NAV of the underlying investment. •Pooled separate accounts: Unit value calculated based on the observable NAV of the underlying investment. •Government and corporate debt securities: Valued based on readily available inputs such as yield or price of bonds of comparable quality, coupon, maturity and type. •Insurance annuity: Value is derived based on the value of the corresponding liability. Non-Recurring Fair Value Measurements The Company recognized asset impairment charges of $71.0 million and $8.9 million for the years ended October 31, 2022 and 2021. The following table presents quantitative information about the significant unobservable inputs used to determine the fair value of the impairment of long-lived assets held and used and net assets held for sale for the twelve months ended October 31, 2022 and 2021:
| Quantitative Information about Level 3 Fair Value Measurements
(in millions) | Fair Value of Impairment |  | Valuation Technique |  | Unobservable Input |  | Range of Input Values
October 31, 2022 |  |  |  |  |  |  |
Impairment of Net Assets Held for Sale | $ | 62.4 |  |  | Indicative Bids |  | Indicative Bids |  | N/A
Impairment of Long Lived Assets | $ | 8.6 |  |  | Discounted Cash Flows, Indicative Bids |  | Discounted Cash Flows, Indicative Bids |  | N/A
Total | $ | 71.0 |  |  |  |  |  |  |
October 31, 2021 |  |  |  |  |  |  |
Impairment of Net Assets Held for Sale | $ | 1.0 |  |  | Indicative Bids |  | Indicative Bids |  | N/A
Impairment of Long Lived Assets | $ | 7.9 |  |  | Discounted Cash Flows, Indicative Bids |  | Discounted Cash Flows, Indicative Bids |  | N/A
Total | $ | 8.9 |  |  |  |  |  |  |
Long-Lived Assets and Assets and Liabilities Held for Sale On January 3, 2022, the Company entered into a definitive agreement to divest approximately 50% equity interest in the Flexible Products & Services business. This agreement triggered the reclassification of the Flexible Products & Services business to assets and liabilities held for sale, which further resulted in recognized impairment charges of $62.4 million in the first quarter of 2022. See Note 4 herein for additional disclosures of the FPS Divestiture. During the year ended October 31, 2022, the Company wrote off long-lived assets with a carrying value of $4.0 million, resulting in recognized asset impairment charges of $4.0 million. These charges include $2.3 million related to properties, plants and equipment, net, in the Global Industrial Packaging reportable segment and $1.7 million related to properties, plants and equipment, net, in the Paper Packaging & Services reportable segment. During the year ended October 31, 2021, the Company wrote down long-lived assets and net assets held for sale with a carrying value of $9.9 million to a fair value of $1.0 million, resulting in recognized asset impairment charges of $8.9 million. These charges include $2.7 million related to properties, plants and equipment, net, and net assets held for sale in the Global Industrial Packaging reportable segment, $1.2 million related properties, plants and equipment, net in the Land Management reportable segment, and $5.0 million related to properties, plants and equipment, net, in the Paper Packaging & Services reportable segment. During the year ended October 31, 2020, the Company wrote down long-lived assets with a carrying value of $36.4 million to a fair value of $17.9 million, resulting in recognized asset impairment charges of $18.5 million. These charges include $5.1 million related to properties, plants and equipment, net, in the Global Industrial Packaging reportable segment, $0.9 million related to definite-lived intangibles in the Global Industrial Packaging reportable segment, and $12.5 million related to properties, plants and equipment, net, in the Paper Packaging & Services reportable segment. The assumptions used in measuring fair value of long-lived assets are considered level 3 inputs, which include bids received from third parties, recent purchase offers, market comparable information and discounted cash flows based on assumptions that market participants would use. Goodwill and Indefinite-Lived Intangibles On an annual basis or when events or circumstances indicate impairment may have occurred, the Company performs impairment tests for goodwill and indefinite-lived intangibles as defined under ASC 350, “Intangibles-Goodwill and Other.” During the year ended October 31, 2020, the Company allocated $35.6 million of goodwill to the Consumer Packaging Group ("CPG") divestiture in April 2020, on a relative fair value basis. There was no goodwill impairment for the years ended October 31, 2022, 2021 and 2020. There was $4.6 million indefinite-lived intangibles impairment for the years ended October 31, 2022. There was no indefinite-lived intangibles impairment for the years ended October 31, 2021 and October 31, 2020.

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