XML 37 R13.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Derivative Instruments | 12 Months Ended
--- | ---
Dec. 31, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Instruments | Derivative Instruments The following describes our derivative classifications: Cash Flow Hedges. Includes certain derivative contracts we execute to mitigate the risk of price volatility in forecasted transactions. Fair Value Hedges. Includes derivative contracts we hold to hedge the risk of changes in the price of our inventory. Non-designated Derivatives. Includes derivatives we primarily transact to mitigate the risk of market price fluctuations in the form of swap or futures contracts as well as certain forward fixed price purchase and sale contracts, and for portfolio optimization. In addition, non-designated derivatives are held to hedge the risk of currency rate fluctuations. The following table presents the gross fair value of our derivative instruments and their locations on the consolidated balance sheets (in millions):
|  |  | Gross Derivative Assets |  | Gross Derivative Liabilities
|  |  | As of December 31, |  | As of December 31,
Derivative Instruments |  | Balance Sheet Location |  | 2017 |  | 2016 |  |  | 2017 |  | 2016
Derivatives designated as hedging instruments |  |  |  |  |  |  |  |  |
Commodity contracts |  | Short-term derivative assets, net |  | $ | 0.4 |  |  | $ | 2.2 |  |  |  | $ | 0.5 |  |  | $ | 5.4 |
|  | Identifiable intangible and other non-current assets |  | — |  |  | — |  |  |  | — |  |  | — |
|  | Accrued expenses and other current liabilities |  | 2.3 |  |  | 86.0 |  |  |  | 43.1 |  |  | 93.5 |
|  | Other long-term liabilities |  | — |  |  | 5.1 |  |  |  | — |  |  | 10.1 |
Total derivatives designated as hedging instruments |  | $ | 2.7 |  |  | $ | 93.3 |  |  |  | $ | 43.6 |  |  | $ | 108.9 |
Derivatives not designated as hedging instruments |  |  |  |  |  |  |  |  |
Commodity contracts | Short-term derivative assets, net |  | $ | 191.4 |  |  | $ | 160.3 |  |  |  | $ | 123.3 |  |  | $ | 86.7 |
|  | Identifiable intangible and other non-current assets |  | 18.2 |  |  | 17.1 |  |  |  | 5.2 |  |  | 6.2 |
|  | Accrued expenses and other current liabilities |  | 86.1 |  |  | 52.5 |  |  |  | 138.2 |  |  | 112.2 |
|  | Other long-term liabilities |  | 5.2 |  |  | 8.1 |  |  |  | 13.5 |  |  | 12.1 |
|  |  |  | $ | 300.9 |  |  | $ | 238.0 |  |  |  | $ | 280.2 |  |  | $ | 217.2 |
Foreign currency contracts | Short-term derivative assets, net |  | $ | 4.5 |  |  | $ | 13.5 |  |  |  | $ | 2.8 |  |  | $ | 3.4 |
|  | Identifiable intangible and other non-current assets |  | — |  |  | 0.9 |  |  |  | — |  |  | 0.1 |
|  | Accrued expenses and other current liabilities |  | 3.9 |  |  | 1.6 |  |  |  | 5.7 |  |  | 2.8 |
|  | Other long-term liabilities |  | — |  |  |  |  |  | 0.2 |  |  |
|  |  |  | $ | 8.5 |  |  | $ | 16.0 |  |  |  | $ | 8.7 |  |  | $ | 6.4 |
Total derivatives not designated as hedging instruments |  | $ | 309.4 |  |  | $ | 253.9 |  |  |  | $ | 288.9 |  |  | $ | 223.6 |
Total derivatives |  |  |  | $ | 312.0 |  |  | $ | 347.2 |  |  |  | $ | 332.5 |  |  | $ | 332.5 |
For information regarding our derivative instruments measured at fair value after netting and collateral see Note 12. The following table summarizes the gross notional values of our commodity and foreign currency exchange derivative contracts used for risk management purposes that were outstanding as of December 31, 2017 (in millions):
| As of December 31,
Derivative Instruments |  | Units |  | 2017
Commodity contracts |  |  |  |
Buy / Long |  | BBL |  | 66.5 |
Sell / Short |  | BBL |  | (75.9 | )
Foreign currency exchange contracts |  |  |  |
Sell U.S. dollar, buy other currencies |  | USD |  | (255.8 | )
Buy U.S. dollar, sell other currencies |  | USD |  | 485.5 |
For additional information about our use of derivative instruments, see Item 7A. Quantitative and Qualitative Disclosures About Market Risk. The following table presents the effect and financial statement location of our derivative instruments and related hedged items in fair value hedging relationships on our consolidated statements of income and comprehensive income (in millions):
Realized and Unrealized Gain (Loss) | For the Year Ended |  | Realized and Unrealized Gain (Loss) | For the Year Ended
|  | December 31, |  |  |  | December 31,
Derivative Instruments | Location |  | 2017 |  | 2016 |  | 2015 |  | Hedged Items | Location |  | 2017 |  | 2016 |  | 2015
Commodity contracts |  |  |  |  |  |  |  |  | Inventories |  |  |  |  |  |  |
| Revenue |  | $ | — |  |  | $ | — |  |  | $ | 49.3 |  |  |  | Revenue |  | $ | — |  |  | $ | — |  |  | $ | — |
| Cost of revenue |  | (35.7 | ) |  | (25.3 | ) |  | 37.5 |  |  |  | Cost of revenue |  | 13.0 |  |  | 10.8 |  |  | (70.7 | )
Total gain (loss) |  | $ | (35.7 | ) |  | $ | (25.3 | ) |  | $ | 86.8 |  |  | Total gain (loss) |  | $ | 13.0 |  |  | $ | 10.8 |  |  | $ | (70.7 | )
We recognized net losses in income representing hedge ineffectiveness of $22.7 million and $14.5 million for the years ended December 31, 2017 and 2016, respectively, and net gains of $16.1 million for the year ended December 31, 2015. There were no gains or losses for the year ended December 31, 2017, 2016 and 2015 that were excluded from the assessment of the effectiveness of our fair value hedges. The following table presents the effect and financial statement location of our derivative instruments in cash flow hedging relationships on our accumulated other comprehensive income and consolidated statements of income and comprehensive income (in millions):
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Effective Portion) | For the Year Ended |  | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Effective Portion) | For the Year Ended
| December 31, |  |  | December 31,
Derivative Instruments |  | 2017 |  | 2016 |  | 2015 |  | Location |  | 2017 |  | 2016 |  | 2015
Commodity contracts |  | $ | (7.8 | ) |  | $ | (145.8 | ) |  | $ | 106.5 |  |  | Revenue |  | $ | (41.3 | ) |  | $ | 18.1 |  |  | $ | 7.2 |
Commodity contracts |  | (0.1 | ) |  | 178.1 |  |  | (105.4 | ) |  | Cost of revenue |  | 33.7 |  |  | 20.8 |  |  | (5.3 | )
Total gain (loss) |  | $ | (7.9 | ) |  | $ | 32.3 |  |  | $ | 1.0 |  |  | Total gain (loss) |  | $ | (7.6 | ) |  | $ | 38.8 |  |  | $ | 1.8 |
Amount of Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) | For the Year Ended
| December 31,
Location |  | 2017 |  | 2016 |  | 2015
Revenue |  | $ | 0.7 |  |  | $ | (13.7 | ) |  | $ | 28.6 |
Cost of revenue |  | (15.4 | ) |  | 9.4 |  |  | (17.8 | )
Total gain (loss) |  | $ | (14.8 | ) |  | $ | (4.4 | ) |  | $ | 10.8 |
The effective portion of the gains or losses on derivative instruments designated as cash flow hedges of forecasted transactions are initially reported as a component of accumulated other comprehensive income and subsequently reclassified into earnings once the future transaction affects earnings. The following table presents the effect and financial statement location of our derivative instruments not designated as hedging instruments on our consolidated statements of income and comprehensive income (in millions):
Amount of Realized and Unrealized Gain (Loss) |  | For the Year Ended
|  | December 31,
Derivative Instruments - Non-designated | Location |  | 2017 |  | 2016 |  | 2015
Commodity contracts |  |  |  |  |  |
| Revenue |  | $ | (0.5 | ) |  | $ | 29.7 |  |  | $ | 171.7 |
| Cost of revenue |  | 62.3 |  |  | (31.6 | ) |  | (139.0 | )
|  |  | $ | 61.8 |  |  | $ | (1.9 | ) |  | $ | 32.7 |
Foreign currency contracts |  |  |  |  |  |
| Revenue |  | $ | (3.2 | ) |  | $ | 10.0 |  |  | $ | 4.1 |
| Other (expense) income, net |  | (7.8 | ) |  | (0.8 | ) |  | 9.5 |
|  |  | $ | (11.0 | ) |  | $ | 9.2 |  |  | $ | 13.6 |
Total gain |  |  | $ | 50.8 |  |  | $ | 7.3 |  |  | $ | 46.3 |
Credit-Risk-Related Contingent Features We enter into derivative contracts which may require us to post collateral periodically. Certain of these derivative contracts contain credit-risk-related contingent clauses which are triggered by credit events. These credit events may include the requirement to post additional collateral or the immediate settlement of the derivative instruments upon the occurrence of a credit downgrade or if certain defined financial ratios fall below an established threshold. The following table presents the potential collateral requirements for derivative liabilities with credit-risk-contingent features (in millions):
| Potential Collateral Requirements for Derivative Liabilities with Credit-Risk-Contingent Features
|  |  | As of December 31,
|  |  | 2017 |  |  | 2016
Net derivative liability positions with credit contingent features |  |  | $ | 11.8 |  |  |  | $ | 15.2 |
Maximum potential collateral requirements |  |  | $ | 11.8 |  |  |  | $ | 15.2 |
At December 31, 2017 and 2016, there was no collateral held by our counterparties on these derivative contracts with credit-risk-contingent features.

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

X
- 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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration