XML 88 R17.htm IDEA: XBRL DOCUMENT v3.2.0.727
Note 9 - Derivative Financial Instruments
 12 Months Ended
Jun. 30, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities Disclosure [Text Block]

9. Derivative Financial Instruments


Interest Rate Swaps


In order to manage our interest rate exposure, we are party to $35.0 million of active floating to fixed rate swaps. These swaps convert our interest payments from LIBOR to a weighted average rate of 1.63% at June 30, 2015.


The fair value of the swaps recognized in accrued liabilities and in other comprehensive income (loss) at June 30, 2015 and 2014 is as follows (in thousands):


                     

Fair Value at June 30,

  

Effective Date

  

Notional Amount

    

Fixed Interest Rate

  

Maturity

  

2015

    

2014

  

June 1, 2010

   $ 5,000       2.495 %

May 26, 2015

   $ -     $ (108 )

June 1, 2010

     5,000       2.495 %

May 26, 2015

     -       (108 )

June 4, 2010

     10,000       2.395 %

May 26, 2015

     -       (206 )

June 9, 2010

     5,000       2.34 %

May 26, 2015

     -       (100 )

June 18, 2010

     5,000       2.38 %

May 26, 2015

     -       (103 )

September 21, 2011

     5,000       1.60 %

September 22, 2014

     -       (18 )

March 15, 2012

     10,000       2.75 %

March 15, 2016

     (186 )     (418 )

December 19, 2014

     20,000       1.18 %

December 19, 2017

     (140 )     -  

December 19, 2014

     5,000       1.20 %

December 19, 2017

     (36 )     -  

December 19, 2015

     10,000       2.01 %

December 19, 2019

     (150 )     -  

December 18, 2015

     15,000       1.46 %

December 19, 2018

     (39 )     -  
                      $ (551 )   $ (1,061 )

The Company reported no losses for the years ended June 30, 2015, 2014, and 2013, as a result of hedge ineffectiveness. Future changes in these swap arrangements, including termination of the agreements, may result in a reclassification of any gain or loss reported in accumulated other comprehensive income (loss) into earnings as an adjustment to interest expense. Accumulated other comprehensive income (loss) related to these instruments is being amortized into interest expense concurrent with the hedged exposure.


Foreign Exchange Contracts


Forward foreign currency exchange contracts are used to limit the impact of currency fluctuations on certain anticipated foreign cash flows, such as foreign purchases of materials and loan payments to and from subsidiaries. The Company enters into such contracts for hedging purposes only. For hedges of intercompany loan payments, the Company has not elected hedge accounting due to the general short-term nature and predictability of the transactions, and records derivative gains and losses directly to the consolidated statement of operations. At June 30, 2015 and 2014 the Company had outstanding forward contracts related to hedges of intercompany loans with net unrealized gain / (losses) of $0.7 million and ($1.2) million, respectively, which approximate the unrealized gains or losses on the related loans. The contracts have maturity dates ranging from 2016-2019, which correspond to the related intercompany loans. The notional amounts of these instruments, by currency, are as follows:


Currency

  

2015

    

2014

  

Euro

     10,134,797       24,289,064  

Canadian Dollar

     -       3,600,000  

Pound Sterling

     1,730,542       3,975,192  

The table below presents the fair value of derivative financial instruments as well as their classification on the balance sheet at June 30, (in thousands):


 

Asset Derivatives

  
 

2015

  

2014

  

Derivative designated as

Balance

        

Balance

        

hedging instruments

Sheet

        

Sheet

        
 

Line Item

  

Fair Value

  

Line Item

  

Fair Value

  

Foreign exchange contracts

Other Assets

   $ 844  

Other Assets

   $ 356  

 

Liability Derivatives

  
 

2015

  

2014

  

Derivative designated as

Balance

        

Balance

        

hedging instruments

Sheet

        

Sheet

        
 

Line Item

  

Fair Value

  

Line Item

  

Fair Value

  

Interest rate swaps

Accrued Liabilities

   $ 551  

Accrued Liabilities

   $ 1,061  

Foreign exchange contracts

Accrued Liabilities

     193  

Accrued Liabilities

     1,552  
      $ 744       $ 2,613  

The table below presents the amount of gain (loss) recognized in comprehensive income on our derivative financial instruments (effective portion) designated as hedging instruments and their classification within comprehensive income for the periods ended (in thousands):


   

2015

    

2014

    

2013

  

Interest rate swaps

   $ (533 )   $ (194 )   $ (195 )

Foreign exchange contracts

     (154 )      -       -  
    $  (687 )   $ (194 )   $ (195 )

The table below presents the amount reclassified from accumulated other comprehensive income (loss) to Net Income for the periods ended (in thousands): 


Details about Accumulated

                       

Affected line item

Other Comprehensive

                        

in the Statements

Income (Loss) Components

  

2015

    

2014

    

2013

  

of Operations

Interest rate swaps

   $ 1,034     $ 1,031     $ 1,050  

Interest expense

Foreign exchange contracts

     -       -       -  

Cost of goods sold
    $ 1,034     $ 1,031       1,050