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DERIVATIVE INSTRUMENTS | 3 Months Ended
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Mar. 31, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
DERIVATIVE INSTRUMENTS | 17. DERIVATIVE INSTRUMENTS Interest Rate Swap Agreements — The Company manages its exposure to changes in interest rates by optimizing the use of variable-rate and fixed-rate debt and by utilizing interest rate swaps to hedge our exposure to changes in interest rates, to reduce the volatility of our financing costs, and to achieve a desired proportion of fixed versus floating-rate debt, based on current and projected market conditions. The Company has entered into long-term interest rate swap agreements to lock into a fixed interest rate base that have a notional value of $875.0 million as of March 31, 2025 and $1,750.0 million as of December 31, 2024. Under the terms of the agreements, $875.0 million in variable-rate debt is swapped for a weighted average fixed interest rate base of approximately 3.69% through February 29, 2028. Commodity Contracts — Certain commodities the Company uses in the production and distribution of its products are exposed to market price risk. The Company utilizes derivative contracts to manage this risk. The majority of commodity forward contracts are not derivatives, and those that are generally qualify for the normal purchases and normal sales scope exception under the guidance for derivative instruments and hedging activities and, therefore, are not subject to its provisions. For derivative commodity contracts that do not qualify for the normal purchases and normal sales scope exception, the Company accounts for the contracts as derivatives. The Company's derivative commodity contracts may include contracts for diesel, oil, plastics, resin, and other commodity contracts that do not meet the requirements for the normal purchases and normal sales scope exception. Diesel contracts are used to manage the Company's risk associated with the underlying cost of diesel fuel used to deliver products. Contracts for oil, plastics, and resin are used to manage the Company's risk associated with the underlying commodity cost of a significant component used in packaging materials. Other commodity contracts that are derivatives that do not meet the normal purchases and normal sales scope exception are used to manage the price risk associated with raw material costs. As of March 31, 2025 and December 31, 2024, the notional value of the commodity contracts outstanding was $90.4 million and $61.5 million, respectively. These commodity contracts have maturities expiring throughout 2025 and 2026 as of March 31, 2025. The following table identifies the fair value of each derivative instrument:
|  | Balance Sheet Location |  | March 31, 2025 |  | December 31, 2024
|  |  |  | (In millions)
Asset derivatives |  |  |  |  |  |
Commodity contracts |  | Prepaid expenses and other current assets |  | $ | 3.6 |  |  | $ | 9.1 |
Interest rate swap agreements |  | Prepaid expenses and other current assets |  | — |  |  | 2.2 |
Interest rate swap agreements |  | Other assets, net |  | 2.1 |  |  | 7.6 |
|  |  |  | $ | 5.7 |  |  | $ | 18.9 |
Liability derivatives |  |  |  |  |  |
Commodity contracts |  | Accrued expenses |  | $ | 0.5 |  |  | $ | — |
Interest rate swap agreements |  | Accrued expenses |  | 3.7 |  |  | 0.4 |
|  |  |  | $ | 4.2 |  |  | $ | 0.4 |
The fair values of the commodity contracts and interest rate swap agreements are determined using Level 2 inputs. Level 2 inputs are inputs other than quoted market prices that are observable for an asset or liability, either directly or indirectly. The fair values of the commodity contracts and interest rate swap agreements are based on an analysis comparing the contract rates to the market rates at the balance sheet date. We recognized the following gains and losses on our derivative contracts in the Condensed Consolidated Statements of Operations:
|  | Location of (Loss) Gain |  | Three Months Ended March 31, |  |
|  | Recognized in Net Loss |  | 2025 |  | 2024 |  |  |  |
|  |  |  | (In millions) |  |
Mark-to-market unrealized (loss) gain |  |  |  |  |  |  |  |
Commodity contracts |  | Other expense (income), net |  | $ | (6.0) |  |  | $ | (0.4) |  |  |  |  |
Interest rate swap agreements |  | Other expense (income), net |  | (11.0) |  |  | 7.4 |  |  |  |  |
Total unrealized (loss) gain |  |  |  | $ | (17.0) |  |  | $ | 7.0 |  |  |  |  |
Realized gain |  |  |  |  |  |  |  |  |  |
Commodity contracts |  | Manufacturing-related to Cost of sales and transportation-related to Selling and distribution |  | $ | 11.1 |  |  | $ | 1.5 |  |  |  |  |
Interest rate swap agreements |  | Interest expense |  | 2.7 |  |  | 5.6 |  |  |  |  |
Total realized gain |  |  |  | $ | 13.8 |  |  | $ | 7.1 |  |  |  |  |
Total (loss) gain |  |  |  | $ | (3.2) |  |  | $ | 14.1 |  |  |  |  |

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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://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/815/tableOfContent + Details
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