XML 34 R20.htm IDEA: XBRL DOCUMENT v3.10.0.1
FAIR VALUE MEASUREMENTS
 12 Months Ended
Dec. 31, 2018
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS
The Company’s fair value measurements are based upon a three-level valuation hierarchy. These valuation techniques are based upon the transparency of inputs (observable and unobservable) to the valuation of an asset or liability as of the measurement date. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs create the following fair value hierarchy:
▪
Level 1 — Valuation is based on quoted prices for identical assets or liabilities in active markets;
▪
Level 2 — Valuation is based on quoted prices for similar assets or liabilities in active markets, or other inputs that are observable for the asset or liability, either directly or indirectly, for the full term of the financial instrument; and
▪
Level 3 — Valuation is based upon other unobservable inputs that are significant to the fair value measurement.
Recurring Fair Value Measurements
The Company maintains a non-qualified deferred compensation plan which is offered to senior management and other key employees. The amount owed to participants is an unfunded and unsecured general obligation of the Company. Participants are offered various investment options with which to invest the amount owed to them, and the plan administrator maintains a record of the liability owed to participants by investment. To minimize the impact of the change in market value of this liability, the Company has elected to purchase a separate portfolio of investments through the plan administrator similar to those chosen by the participant.
The investments purchased by the Company include mutual funds, which are classified as Level 1, and life-insurance contracts valued based on the performance of underlying mutual funds, which are classified as Level 2. Additionally, upon the Company’s acquisition of Supreme, the Company acquired a pool of investments made by a wholly owned captive insurance subsidiary. These investments are comprised of mutual funds, which are classified as Level 1.
The fair value of the Company’s derivatives is estimated with a market approach using third-party pricing services, which have been corroborated with data from active markets or broker quotes.
Fair value measurements and the fair value hierarchy level for the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2018 are shown below (in thousands):
 
 
Frequency
 
Asset / (Liability)
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
December 31, 2018
 
 
 
 
 
 
 
 
 
 
Commodity swap contracts
 
Recurring
 
$
(1,129
)
 
$
—

 
$
(1,129
)
 
$
—

Mutual funds
 
Recurring
 
$
4,140

 
$
4,140

 
$
—

 
$
—

Life-insurance contracts
 
Recurring
 
$
15,333

 
$
—

 
$
15,333

 
$
—

December 31, 2017
 
 
 
 
 
 
 
 
 
 
Commodity swap contracts
 
Recurring
 
$
—

 
$
—

 
$
—

 
$
—

Mutual funds
 
Recurring
 
$
4,284

 
$
4,284

 
$
—

 
$
—

Life-insurance contracts
 
Recurring
 
$
13,806

 
$
—

 
$
13,806

 
$
—


Estimated Fair Value of Debt
The estimated fair value of debt at December 31, 2018 consists primarily of the Senior Notes due 2025 and borrowings under the Term Loan Credit Agreement (see Note 10). The fair value of the Senior Notes due 2025, Term Loan Credit Agreement, and the Revolving Credit Facility are based upon third party pricing sources, which generally do not represent daily market activity or represent data obtained from an exchange, and are classified as Level 2. The interest rates on the Company’s borrowings under the Revolving Credit Facility are adjusted regularly to reflect current market rates and thus carrying value approximates fair value for these borrowings. All other debt and capital lease obligations approximate their fair value as determined by discounted cash flows and are classified as Level 3.
The Company’s carrying and estimated fair value of debt at December 31, 2018 and December 31, 2017 were as follows (in thousands):
 
December 31, 2018
 
December 31, 2017
 
 
 
Fair Value
 
 
 
Fair Value
 
Carrying
Value
 
Level 1
 
Level 2
 
Level 3
 
Carrying
Value
 
Level 1
 
Level 2
 
Level 3
Instrument
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior notes due 2025
$
319,941

 
$
—

 
$
278,688

 
$
—

 
$
319,377

 
$
—

 
$
328,250

 
$
—

Term loan credit agreement
184,957

 
—

 
181,985

 
—

 
186,620

 
—

 
188,048

 
—

Convertible senior notes due 2018
—

 
—

 
—

 
—

 
44,046

 
—

 
83,605

 
—

Other debt
—

 
—

 
—

 
—

 
67

 
—

 
—

 
67

Capital lease obligations
1,013

 
—

 
—

 
1,013

 
1,302

 
—

 
—

 
1,302

 
$
505,911

 
$
—

 
$
460,673

 
$
1,013

 
$
551,412

 
$
—

 
$
599,903

 
$
1,369


The fair value of debt is based on current public market prices for disclosure purposes only. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at the carrying value, net of unamortized premium or discount and unamortized deferred financing costs in the financial statements.