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Derivative Instruments & Hedging Activities | 6 Months Ended
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Jul. 03, 2021
Derivative Instruments And Hedging Activities Disclosure [Abstract] |
DERIVATIVE INSTRUMENTS & HEDGING ACTIVITIES | 7. DERIVATIVE INSTRUMENTS & HEDGING ACTIVITIES The Company addresses certain financial exposures through a controlled program of risk management that includes the use of derivative financial instruments and hedging activities. The fair value of the Company’s derivative financial instruments included in the Consolidated Balance Sheets is presented as follows:
| Asset Derivatives |  |  | Liability Derivatives |
| Balance Sheet |  | Fair Value (1) |  | Fair Value (1) |  |  | Balance Sheet |  | Fair Value (1) |  | Fair Value (1) |
| Location |  | July 3, 2021 |  | January 2, 2021 |  |  | Location |  | July 3, 2021 |  | January 2, 2021 |
Derivatives designated as hedging instruments: |  |  |  |  |  |  |  |  |  |
Interest rate swap contracts | Other assets |  | $ | 612 |  | $ | — |  |  | Other non-current liabilities |  | $ | 5,389 |  | $ | 7,679 |
Derivatives not designated as hedging instruments: |  |  |  |  |  |  |  |  |  |
Forward foreign exchange contracts | Other current assets |  |  | 169 |  |  | 169 |  |  | Other current liabilities |  |  | 555 |  |  | 1,413 |
Forward foreign exchange contracts | Other assets |  |  | 29 |  |  | 42 |  |  | Other non-current liabilities |  |  | 20 |  |  | 138 |
Total derivatives |  |  | $ | 810 |  | $ | 211 |  |  |  |  | $ | 5,964 |  | $ | 9,230 |
(1) See Note 3 for information regarding the inputs used in determining the fair value of derivative assets and liabilities. |
The amount of gains and losses related to the Company’s derivative financial instruments for the six months ended July 3, 2021 and June 27, 2020, are presented as follows:
|  | Amount of Gain or (Loss) Recognized in Other Comprehensive Income on Derivatives (Effective Portion) |  |  | Location of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income | Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Earnings (Effective Portion) |
|  | July 3, 2021 |  | June 27, 2020 |  |  | into Earnings (Effective Portion) |  | July 3, 2021 |  | June 27, 2020 |
Derivatives in cash flow hedging relationships: |  |  |  |  |  |  |  |  |  |
Interest rate swap contracts |  | $ | 2,906 |  | $ | (3,731 | ) |  | Interest expense, net |  | $ | (2,170 | ) | $ | (1,558 | )
Interest expense presented in the Consolidated Statements of Operations, in which the effects of cash flow hedges are recorded, totaled $9,151 and $5,842 for the six months ended July 3, 2021 and June 27, 2020, respectively.
|  | Amount of Gain or (Loss) Recognized in Earnings on Derivatives |  |  | Location of Gain or (Loss) Recognized
|  | July 3, 2021 |  | June 27, 2020 |  |  | in Earnings on Derivatives
Derivatives not designated as hedging instruments: |  |  |
Forward foreign exchange contracts |  | $ | 1,909 |  | $ | 41 |  |  | Foreign currency transaction gain loss, net
Interest Rate Swap Contracts The Company has entered into interest rate swap transactions to hedge the variable interest rate payments on its credit facilities. In connection with these transactions, the Company pays interest based upon a fixed rate as agreed upon with the respective counterparties and receives variable rate interest payments based on the one-month LIBOR. The interest rate swaps are designated as hedging instruments and are accounted for as cash flow hedges. The aggregate notional amount of the swaps was $195,000 as of July 3, 2021. The notional amount decreases periodically through the dates of expiration in April 2023 and October 2025. The contracts are settled with the respective counterparties on a net basis at each settlement date. Forward Foreign Exchange Contracts The Company has entered into forward contracts to economically hedge translational and transactional exposure associated with various business units whose local currency differs from the Company’s reporting currency. The Company’s forward contracts are not designated as hedging instruments for accounting purposes. At July 3, 2021, the Company had nine forward foreign exchange contracts with an aggregate notional value of €52,112, maturing at various dates through December 2022. Net Investment Hedge The Company utilizes foreign currency denominated debt to hedge currency exposure in foreign operations. The Company has designated €90,000 of borrowings on the revolving credit facility as a net investment hedge of a portion of the Company’s European operations. The carrying value of the euro denominated debt totaled $106,777 as of July 3, 2021 and is included in the Revolving line of credit line item in the Consolidated Balance Sheets. The gain on the net investment hedge recorded in accumulated other comprehensive income (“AOCI”) as part of the currency translation adjustment was $2,416, net of tax, for the six months ended July 3, 2021.

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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