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Derivatives
 9 Months Ended
Sep. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivatives

Note 7. Derivatives

To reduce exposure to variability in expected future cash outflows on variable rate debt attributable to the changes in one-month SOFR, the Company has historically entered into interest rate derivative instruments to economically offset a portion of this risk and may do so in the future.

As of September 30, 2025, the Company had the following outstanding derivatives that were not designated as a hedge in qualifying hedging relationships:

Product

 

Effective Date

 

Maturity Date

 

Notional

 

Rate

Interest rate swap

 

June 30, 2023

 

February 28, 2026

 

$100.0 million

 

4.32%

Interest rate swap

 

December 29, 2023

 

December 31, 2026

 

$150.0 million

 

3.86%

Interest rate swap

 

March 1, 2024

 

December 31, 2026

 

$150.0 million

 

3.76%

Interest rate swap

 

August 31, 2024

 

December 31, 2026

 

$160.0 million

 

3.72%

Interest rate swap

 

October 31, 2024

 

October 31, 2027

 

$275.0 million

 

3.94%

Interest rate swap

 

April 30, 2025

 

April 30, 2028

 

$250.0 million

 

3.56%

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to interest rate movements; however, the Company has not elected to apply hedge accounting for these instruments.

The following is a summary of location and fair value of the financial positions recorded related to the derivative instruments as of September 30, 2025 and December 31, 2024 (in thousands):

 

 

 

 

Fair Value

 

Derivatives not designated
as hedging instruments

 

Balance Sheet Location

 

September 30, 2025

 

 

December 31, 2024

 

Interest rate swaps

 

Prepaid expenses and other current assets

 

$

—

 

 

$

3,110

 

Interest rate swaps

 

Accrued liabilities

 

$

6,330

 

 

$

247

 

The following is a summary of location and amount of gains and losses recorded related to the derivative instruments (in thousands):

 

 

 

 

Gain (Loss)

 

 

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

Derivatives not designated
as hedging instruments

 

Income Statement Location

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Interest rate collars

 

Interest expense, net

 

$

—

 

 

$

—

 

 

$

—

 

 

$

951

 

Interest rate swaps

 

Interest expense, net

 

$

812

 

 

$

(8,171

)

 

$

(5,607

)

 

$

55