XML 27 R16.htm IDEA: XBRL DOCUMENT v3.24.2
FINANCIAL DERIVATIVE INSTRUMENTS
 6 Months Ended
Jun. 30, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
FINANCIAL DERIVATIVE INSTRUMENTS FINANCIAL DERIVATIVE INSTRUMENTS
Commodity Pricing Risk
As of June 30, 2024, the Company was party to commodity swap contracts for specific commodities with notional amounts of approximately $36.7 million. The Company uses commodity swap contracts to mitigate the risks associated with fluctuations in commodity prices impacting its cash flows related to inventory purchases from suppliers. The Company does not hedge all commodity price risk.
At inception, the Company designated the commodity swap contracts as cash flow hedges. The contracts mature at specified monthly settlement dates and will be recognized into earnings through December 2024. The effective portion of the hedging transaction is recognized in Accumulated Other Comprehensive Income (Loss) (“AOCI”) and transferred to earnings when the forecasted hedged transaction takes place or when the forecasted hedged transaction is no longer probable to occur.
Financial Statement Presentation
As of June 30, 2024 and December 31, 2023, the fair value carrying amount of the Company’s derivative instruments were recorded as follows (in thousands):
Asset / (Liability) Derivatives
Balance Sheet CaptionJune 30,
2024		December 31,
2023
Derivatives designated as hedging instruments
Commodity swap contractsPrepaid expenses and other$1,940 $1,511 
Commodity swap contractsAccounts payable and Other accrued liabilities(1,818)(1,045)
Total derivatives designated as hedging instruments$122 $466 

The following table summarizes the gain or loss recognized in AOCI as of June 30, 2024 and December 31, 2023 and the amounts reclassified from AOCI into earnings for the three and six months ended June 30, 2024 and 2023 (in thousands):
Amount of (Loss) Gain Recognized in AOCI on Derivatives (Effective Portion, net of tax)Location of Gain (Loss) Reclassified from AOCI into Earnings
(Effective Portion)		Amount of Gain (Loss)
Reclassified from AOCI into Earnings
June 30,
2024		December 31,
2023		Three Months Ended
June 30,		Six Months Ended
June 30,
2024202320242023
Derivatives instruments
Commodity swap contracts$(277)$388 Cost of sales$624 $(369)$(124)$117 
Over the next 12 months, the Company expects to reclassify approximately $0.4 million of pretax deferred losses, related to the commodity swap contracts, from AOCI to cost of sales as inventory purchases are settled.