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Derivatives | 9 Months Ended
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Sep. 30, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives | Derivatives: The Company periodically enters into derivative financial instruments; typically interest rate swaps, interest rate caps and foreign currency contracts, to reduce its exposure to fluctuations in interest rates on variable-rate debt and foreign currency exchange rates. The Company does not utilize derivative financial instruments with a level of complexity or with a risk greater than the exposure to be managed, nor does it enter into or hold derivatives for trading or speculative purposes. The Company periodically reviews the creditworthiness of the counterparty to assess the counterparty's ability to honor its obligations. Counterparty default would expose the Company to fluctuations in interest and currency rates. Derivative financial instruments are recognized at fair value in the Company's Consolidated Balance Sheets. The following table summarizes the fair value of derivative instruments as of September 30, 2023 and December 31, 2022 (amounts in thousands):
|  | September 30, 2023 |  | December 31, 2022
|  | Balance Sheet Location |  | Fair Value |  | Balance Sheet Location |  | Fair Value
Derivatives designated as hedging instruments: |  |  |  |  |  |  |  |
Interest rate contracts |  | Other assets |  | $ | 32,482 |  |  | Other assets |  | $ | 37,305 |
Interest rate contracts |  | Other liabilities |  | 3,195 |  |  | Other liabilities |  | — |
Derivatives not designated as hedging instruments: |  |  |  |  |  |  |  |
Foreign currency contracts |  | Other assets |  | 10,380 |  |  | Other assets |  | 487 |
Foreign currency contracts |  | Other liabilities |  | 206 |  |  | Other liabilities |  | 19,120 |
Derivatives Designated as Hedging Instruments: Changes in fair value of derivative contracts designated as cash flow hedging instruments are recognized in other comprehensive income ("OCI"). As of September 30, 2023 and December 31, 2022, the notional amount of interest rate contracts designated as cash flow hedging instruments w as $878.2 million and $719.7 million, respectively. Derivatives designated as cash flow hedging instruments were evaluated and remained highly effective at September 30, 2023 and have remaining terms of three months to five years. The Co mpany estimates that approxi mately $16.6 million of net derivative gains included in OCI w ill be reclassified into earnings within the next 12 months. The following tables summarize the effects of derivatives designated as cash flow hedging instruments on the Company's Consolidated Financial Statements for the three and nine months ended September 30, 2023 and 2022 (amounts in thousands):
|  | Gain/(loss) recognized in OCI, net of tax
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
Derivatives designated as cash flow hedging instruments |  | 2023 |  | 2022 |  | 2023 |  | 2022
Interest rate contracts |  | $ | (2,712) |  |  | $ | 19,983 |  |  | $ | 7,430 |  |  | $ | 41,106 |
|  | Gain/(loss) reclassified from OCI into income
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
Location of gain/(loss) reclassified from OCI into income |  | 2023 |  | 2022 |  | 2023 |  | 2022
Interest expense, net |  | $ | 6,498 |  |  | $ | 383 |  |  | $ | 18,666 |  |  | $ | (3,819) |
During the three months ended September 30, 2023, with the discontinuation of LIBOR on June 30, 2023, and transition of the Company's interest rate swaps from LIBOR to SOFR, the Company discontinued the prior elections under ASU 2021-01, "Reference Rate Reform (Topic 848): Overall" ("ASU 2021-01"). Derivatives Not Designated as Hedging Instruments: The Company enters into foreign currency contracts to economically hedge foreign currency re-measurement exposure related to certain balances denominated in currencies other than the functional currency of the entity. Changes in fair value of derivative contracts not designated as hedging instruments are recognized in earnings. As of September 30, 2023 and December 31, 2022, the notional amount of foreign currency contracts w as $412.0 million and $460.8 million, respectively. The following table summarizes the effects of derivatives not designated as hedging instruments on the Company's Consolidated Income Statements for the three and nine months ended September 30, 2023 and 2022 (amounts in thousands):
|  |  |  | Gain/(loss) recognized in income
|  |  |  | Three Months Ended September 30,
Derivatives not designated as hedging instruments |  | Location of gain/(loss) recognized in income |  | 2023 |  | 2022
Foreign currency contracts |  | Foreign exchange gain, net |  | $ | 8,137 |  |  | $ | 33,019 |
Foreign currency contracts |  | Interest expense, net |  | 204 |  |  | 313 |
|  |  |  | Gain/(loss) recognized in income
|  |  |  | Nine Months Ended September 30,
Derivatives not designated as hedging instruments |  | Location of gain/(loss) recognized in income |  | 2023 |  | 2022
Foreign currency contracts |  | Foreign exchange gain/(loss), net |  | $ | (7,149) |  |  | $ | 72,371 |
Foreign currency contracts |  | Interest expense, net |  | 1,357 |  |  | (638) |

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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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