XML 28 R13.htm IDEA: XBRL DOCUMENT
v3.25.1

FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | 6 Months Ended
--- | ---
Apr. 30, 2025
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 for those assets and (liabilities) measured on a recurring basis as of April 30, 2025 and October 31, 2024:
| April 30, 2025
| Assets |  | Liabilities
(in millions) | Level 1 |  | Level 2 |  | Level 3 |  | Total |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Interest rate derivatives | $ | — |  |  | $ | 26.1 |  |  | $ | — |  |  | $ | 26.1 |  |  | $ | — |  |  | $ | (12.7) |  |  | $ | — |  |  | $ | (12.7) |
Foreign exchange hedges | — |  |  | 0.7 |  |  | — |  |  | 0.7 |  |  | — |  |  | (1.4) |  |  | — |  |  | (1.4) |
Insurance annuity | — |  |  | — |  |  | 20.0 |  |  | 20.0 |  |  | — |  |  | — |  |  | — |  |  | — |
Cross currency swap | — |  |  | 6.4 |  |  | — |  |  | 6.4 |  |  | — |  |  | (39.5) |  |  | — |  |  | (39.5) |
| October 31, 2024
| Assets |  | Liabilities
(in millions) | Level 1 |  | Level 2 |  | Level 3 |  | Total |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Interest rate derivatives | $ | — |  |  | $ | 40.4 |  |  | $ | — |  |  | $ | 40.4 |  |  | $ | — |  |  | $ | (5.6) |  |  | $ | — |  |  | $ | (5.6) |
Foreign exchange hedges | — |  |  | 0.2 |  |  | — |  |  | 0.2 |  |  | — |  |  | (0.1) |  |  | — |  |  | (0.1) |
Insurance annuity | — |  |  | — |  |  | 18.9 |  |  | 18.9 |  |  | — |  |  | — |  |  | — |  |  | — |
Cross currency swap | — |  |  | 17.6 |  |  | — |  |  | 17.6 |  |  | — |  |  | (6.4) |  |  | — |  |  | (6.4) |
The carrying amounts of cash and cash equivalents, trade accounts receivable, accounts payable, current liabilities and short-term borrowings as of April 30, 2025 and October 31, 2024 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 April 30, 2025, the Company has various interest rate swaps with a total notional amount of $1,362.5 million ($1,400.0 million as of October 31, 2024), maturing between March 1, 2027 and July 16, 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 2.99%. This effectively converted 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. These derivatives are designated as cash flow hedges for accounting purposes. Accordingly, the gain or loss on these derivative instruments is reported as a component of other comprehensive income (loss) 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 12 to the interim condensed consolidated financial statements for additional disclosures of the aggregate gain or loss included within other comprehensive income (loss). 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. Gains reclassified to earnings under these contracts were $4.6 million and $8.9 million for the three months ended April 30, 2025, and 2024, respectively. Gains reclassified to earnings under these contracts were $10.2 million and $18.6 million for the six months ended April 30, 2025, and 2024, respectively. A derivative gain of $10.0 million, based upon interest rates at April 30, 2025, is expected to be reclassified from accumulated other comprehensive income 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 April 30, 2025, and October 31, 2024, the Company had outstanding foreign currency forward contracts in the notional amount of $112.5 million and $74.1 million, respectively. 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 are based on observable market pricing for similar instruments, principally foreign exchange futures contracts. For the three months ended April 30, 2025, and 2024, the Company recorded realized gains of $1.1 million and $2.9 million, respectively, under fair value contracts in other expense, net. For the six months ended April 30, 2025, and 2024, the Company recorded realized gains of $0.9 million and $2.9 million, respectively, under fair value contracts in other expense, net. For the three months ended April 30, 2025, and 2024, the Company recorded unrealized net losses of $0.8 million and $2.8 million, respectively, in other expense, net. For the six months ended April 30, 2025, and 2024, the Company recorded unrealized net losses of $0.7 million and $0.4 million, respectively, in other expense, net. Cross Currency Swap The Company has operations and investments in various international locations and is subject to risks associated with changing foreign exchange rates. As of April 30, 2025, the Company has various cross currency interest rate swaps that synthetically swap $534.9 million ($447.6 million as of October 31, 2024) of U.S. fixed rate debt to Euro denominated fixed rate debt. The Company receives a weighted average rate of 1.64% on these swaps. These agreements are designated as either net investment hedges or cash flow hedges for accounting purposes and will mature between October 5, 2026 and November 3, 2028. The gain or loss on these net investment hedge derivative instruments is included in the foreign currency translation component of other comprehensive income (loss) until the net investment is sold, diluted, or liquidated. See Note 12 to the interim condensed consolidated financial statements for additional disclosures of the aggregate gain or loss included within other comprehensive income (loss). 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 three months ended April 30, 2025 and 2024, gains recorded in interest expense, net under the cross currency swap agreements were $1.7 million and $1.6 million, respectively. For the six months ended April 30, 2025 and 2024, gains recorded in interest expense, net under the cross currency swap agreements were $3.3 million and $3.5 million, respectively. During the first quarter of 2025, the Company executed a cash settlement of certain cross-currency swap contracts and simultaneously entered into new cross-currency swaps at prevailing market rates. The net cash settlement from restriking these swaps resulted in a cash receipt of $22.5 million of which $11.5 million related to cross-currency swap contracts designated as net investment hedges and $11.0 million related to cross-currency swap contracts designated as cash flow hedges. The net investment hedges that were settled resulted in a final gain of $11.3 million, which is included in the foreign currency translation component of other comprehensive income (“OCI”) and the final OCI balance on these transactions is maintained on the balance sheet until the underlying hedged subsidiary is either sold or substantially liquidated. For the cash flow hedges that were settled, the gain will be recognized to income, through interest expense, over time through an amortization of the remaining OCI balance at termination. This OCI balance amounted to $1.8 million and will be recognized on a straight-line basis to the income statement through the transaction’s original maturity date of October 5, 2026. Other Financial Instruments The fair values of the Company’s 2022 Credit Agreement, the 2023 Credit Agreement, the U.S. RFA, and the 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 Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures.” Non-Recurring Fair Value Measurements 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 three months ended April 30, 2025 and 2024:
| Quantitative Information about Level 3 Fair Value Measurements
(in millions) | Impairment Amount |  | Valuation Technique |  | Unobservable Input |  | Range of Input Values
April 30, 2025 |  |  |  |  |  |  |
Net Assets Held for Sale | $ | 4.7 |  |  | Indicative Bids |  | Indicative Bids |  | N/A
Long Lived Assets | $ | 19.7 |  |  | Discounted Cash Flows; Indicative Bids |  | Discounted Cash Flows; Indicative Bids |  | N/A
Total | $ | 24.4 |  |  |  |  |  |  |
April 30, 2024 |  |  |  |  |  |  |
Long Lived Assets | $ | 1.7 |  |  | Discounted Cash Flows; Indicative Bids |  | Discounted Cash Flows; Indicative Bids |  | N/A
Total | $ | 1.7 |  |  |  |  |  |  |
For six months ended April 30, 2025, the Company wrote down long-lived assets with a carrying value of $44.3 million to a fair value of $24.6 million, resulting in recognized asset impairment charges of $19.7 million. These charges include $0.7 million related to properties, plants and equipment, net, in the Customized Polymer Solutions reportable segment, $2.2 million related to properties, plants and equipment, net, in the Durable Metal Solutions reportable segment, $16.4 million related to properties, plants and equipment, net, in the Sustainable Fiber Solutions reportable segment, $0.2 million related to properties, plants and equipment, net in the Integrated Solutions reportable segment and $0.2 million related to definite-lived intangibles in the Integrated Solutions reportable segment. For six months ended April 30, 2025, the Company also recognized impairment charges of $4.7 million related to net assets held for sale in the Sustainable Fiber Solutions reportable segment. For six months ended April 30, 2024, the Company wrote down long-lived assets with a carrying value of $4.0 million to a fair value of $2.3 million, resulting in recognized asset impairment charges of $1.7 million. These charges include $0.4 million related to properties, plants and equipment, net, in the Durable Metal Solutions reportable segment and $1.3 million related to properties, plants and equipment, net, in the Sustainable Fiber Solutions 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.

X
- Definition The entire disclosure for derivatives and fair value of assets and liabilities. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 820 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/820/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/815/tableOfContent + Details
Name: | us-gaap_DerivativesAndFairValueTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration