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Derivative Financial Instruments | 3 Months Ended
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Mar. 31, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Financial Instruments | Derivative Financial Instruments The Company’s risk management objective is to ensure that business exposures to risks that have been identified and measured, and are capable of being controlled, are minimized using the most effective and efficient methods to eliminate, reduce, or transfer such exposures. Operating decisions consider these associated risks and structure transactions to avoid these risks whenever possible. Use of derivative instruments is consistent with the overall business and risk management objectives of the Company. Derivative instruments may be used to manage business risk within limits specified by the Company’s risk policy and manage exposures that have been identified through the risk identification and measurement process, provided that they clearly qualify as “hedging” activities as defined in the risk policy. Use of derivative instruments is not automatic, nor is it necessarily the only response to managing pertinent business risk. Use is permitted only after the risks that have been identified are determined to exceed defined tolerance levels and are considered to be unavoidable. The primary risks managed by the Company by using derivative instruments are commodity price risk and foreign currency exchange risk. Swap contracts on various commodities are entered into to help manage the price risk associated with forecasted purchases of materials used in the Company’s manufacturing process. The Company also enters into various foreign currency derivative instruments to help manage foreign currency risk associated with the Company’s projected purchases and sales and foreign currency denominated receivable and payable balances. ASC Topic 815-10 requires companies to recognize all derivative instruments as either assets or liabilities at fair value in the statement of financial position. In accordance with ASC Topic 815-10, the Company designates commodity swaps and foreign currency exchange contracts as cash flow hedges of forecasted purchases of commodities and currencies. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income (loss) and is reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative instruments representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. In the next twelve months, the Company estimates that $0.2 million of unrealized losses, net of tax, related to commodity price and currency rate hedging will be reclassified from other comprehensive income into earnings. Foreign currency and commodity hedging is generally completed prospectively on a rolling basis for 12 and 24 months, respectively, depending on the type of risk being hedged. As of March 31, 2017 and December 31, 2016, the Company had the following outstanding commodity and foreign currency exchange contracts that were intended to hedge forecasted transactions:
Designated Hedging Instruments |  | Units Hedged |  |  |  |
Commodity |  | March 31, 2017 |  | December 31, 2016 |  | Unit |  | Type
Natural Gas |  | 3,579 |  |  | 26,807 |  |  | MMBtu |  | Cash Flow
Steel |  | 1,945 |  |  | 3,190 |  |  | Tons |  | Cash Flow
Designated Hedging Instruments |  | Units Hedged |  |
Currency |  | March 31, 2017 |  | December 31, 2016 |  | Type
Australian Dollar |  | 1,380,374 |  |  | 611,143 |  |  | Cash Flow
European Euro |  | 4,609,005 |  |  | 9,834,120 |  |  | Cash Flow
South Korean Won |  | 83,579,000 |  |  | 218,408,100 |  |  | Cash Flow
Singapore Dollar |  | 300,000 |  |  | 900,000 |  |  | Cash Flow
United States Dollar |  | — |  |  | 2,311,697 |  |  | Cash Flow
Japanese Yen |  | 43,867,400 |  |  | 65,502,800 |  |  | Cash Flow
For derivative instruments that are not designated as hedging instruments under ASC Topic 815-10, the gains or losses on the derivatives are recognized in current earnings within Other (expense) income, net in the Condensed Consolidated Statements of Operations. As of March 31, 2017 and December 31, 2016, the Company had the following outstanding foreign currency exchange contracts that were not designated as hedging instruments:
Non Designated Hedging Instruments |  | Units Hedged |  |  |  |
Currency |  | March 31, 2017 |  | December 31, 2016 |  | Recognized Location |  | Purpose
European Euro |  | 4,929,005 |  |  | 10,502,111 |  |  | Other income, net |  | Accounts Payable and Receivable Settlement
United States Dollar |  | 5,550,000 |  |  | 15,318,000 |  |  | Other income, net |  | Accounts Payable and Receivable Settlement
The fair value of outstanding derivative contracts recorded as assets in the accompanying Condensed Consolidated Balance Sheets as of March 31, 2017 and December 31, 2016 was as follows:
Designated Hedging Instruments |  |  |  | ASSET DERIVATIVES
|  |  |  | March 31, 2017 |  | December 31, 2016
(in millions) |  | Balance Sheet Location |  | Fair Value
Derivatives designated as hedging instruments |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Other current assets |  | $ | — |  |  | $ | 0.1 |
Commodity contracts |  | Other current assets |  | 0.1 |  |  | 0.2 |
Total derivatives designated as hedging instruments |  |  |  | $ | 0.1 |  |  | $ | 0.3 |
|  |  |  | ASSET DERIVATIVES
|  |  |  | March 31, 2017 |  | December 31, 2016
(in millions) |  | Balance Sheet Location |  | Fair Value
Derivatives NOT designated as hedging instruments |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Other current assets |  | $ | — |  |  | $ | 0.1 |
Total derivatives NOT designated as hedging instruments |  |  |  | $ | — |  |  | $ | 0.1 |
Total asset derivatives |  |  |  | $ | 0.1 |  |  | $ | 0.4 |
The fair value of outstanding derivative contracts recorded as liabilities in the accompanying Condensed Consolidated Balance Sheets as of March 31, 2017 and December 31, 2016 was as follows:
|  |  |  | LIABILITY DERIVATIVES
|  |  |  | March 31, 2017 |  | December 31, 2016
(in millions) |  | Balance Sheet Location |  | Fair Value
Derivatives designated as hedging instruments |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Accounts payable and accrued expenses |  | $ | 0.3 |  |  | $ | 0.9 |
Total derivatives designated as hedging instruments |  |  |  | $ | 0.3 |  |  | $ | 0.9 |
|  |  |  | LIABILITY DERIVATIVES
|  |  |  | March 31, 2017 |  | December 31, 2016
(in millions) |  | Balance Sheet Location |  | Fair Value
Derivatives NOT designated as hedging instruments |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Accounts payable and accrued expenses |  | $ | — |  |  | $ | 0.1 |
Total derivatives NOT designated as hedging instruments |  |  |  | $ | — |  |  | $ | 0.1 |
Total liability derivatives |  |  |  | $ | 0.3 |  |  | $ | 1.0 |

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 45 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6441202&loc=d3e80720-113993 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624171-113959 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41620-113959 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4B -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624163-113959 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5579240-113959 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4D -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624177-113959 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=35736893&loc=d3e80784-113994 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41641-113959 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5579245-113959 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4H -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624258-113959 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=35736893&loc=d3e80748-113994 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4K -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5708775-113959 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4J -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5708773-113959 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4A -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5618551-113959 Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5580258-113959 Reference 16: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4E -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624181-113959 Reference 17: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 25 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6886632&loc=d3e76258-113986 Reference 18: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41638-113959 Reference 19: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(n)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 + Details
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