10.

Derivative Financial Instruments

Interest Rate Swaps

In order to manage our interest rate exposure, we are party to

$85.0

million of active floating to fixed rate swaps. These swaps convert our interest payments from LIBOR to a weighted average rate of

2.11%

June 30,

2019

The fair value of the swaps recognized in accrued liabilities and in other comprehensive income (loss) at

June 30,

2019

and

2018

is as follows (in thousands):

Effective Date	Notional		Fixed	Maturity	Fair Value at June 30,
	Amount		Interest Rate		2019			2018
December 18, 2015		15,000	1.46%	December 19, 2018	$	-		$	55
December 19, 2015		10,000	2.01%	December 19, 2019		3			74
May 24, 2017		25,000	1.88%	April 24, 2022		(190	)		764
May 24, 2017		25,000	1.67%	May 24, 2020		49			432
August 6, 2018		25,000	2.83%	August 6, 2023		(1,242	)		-
					$	(1,380	)	$	1,325

The Company reported

losses for the years ended

June 30, 2019,

2018,

and

2017,

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 between subsidiaries. The Company enters into such contracts for hedging purposes only. The Company has designated certain of these currency contracts as hedges, and changes in the fair value of these contracts are recognized in other comprehensive income until the hedged items are recognized in earnings. Hedge ineffectiveness, if any, associated with these contracts will be reported in net income. At

June 30, 2019

and

2018,

the Company had outstanding forward contracts related to hedges of intercompany loans with net unrealized gain / (losses) of

$3.1

million and

$2.9

million, respectively, which approximate the unrealized gains or losses on the related loans. The contracts have maturity dates ranging from

2019

2023,

which correspond to the related intercompany loans. The notional amounts of these instruments, by currency in thousands, are as follows:

Currency	2019		2018
USD		55,015		64,558
Euro		5,750		21,300
Pound Sterling		-		6,826
Peso		-		54,000
Canadian		20,600		20,600

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
	2019			2018
Derivative designated as	Balance			Balance
hedging instruments	Sheet			Sheet
	Line Item	Fair Value		Line Item	Fair Value
Interest rate swaps	Other Assets	$	52	Other Assets	$	1,325
Foreign exchange contracts	Other Assets		-	Other Assets		1,357
		$	52		$	2,682

	Liability Derivatives
	2019			2018
Derivative designated as	Balance			Balance
hedging instruments	Sheet			Sheet
	Line Item	Fair Value		Line Item	Fair Value
Interest rate swaps	Accrued Liabilities	$	1,432	Accrued Liabilities	$	-
Foreign exchange contracts	Accrued Liabilities		3,052	Accrued Liabilities		4,204
		$	4,484		$	4,204

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):

	2019			2018		2017
Interest rate swaps	$	1,703		$	1,367	$	282
Foreign exchange contracts		(3,279	)		1,174		(3,178	)
	$	(1,576	)	$	2,541	$	(2,896	)

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	2019			2018		2017			of Operations
Interest rate swaps	$	(321	)	$	171	$	399		Interest expense
Foreign exchange contracts		-			-		75		Cost of goods sold
Foreign exchange contracts		1,730			121		(861	)	Interest expense
Net investment hedge		(285	)		-		-		Other Non-Operating Income
	$	1,124		$	292	$	(387	)