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Derivative Financial Instruments and Risk Management

9 Months Ended

Oct. 29, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments and Risk Management

Note 10 – Derivative Financial Instruments and Risk Management

In 2017, we entered into a cross-currency interest rate swap and an interest rate swap to manage the interest rate risk.

On July 30, 2020, we terminated these two swaps. The terms of the A&R Credit Agreement caused those swaps to cease to be effective hedges of the underlying exposures. The termination of the swaps was contracted immediately prior to the end of the second quarter of fiscal 2021 at a cash cost of approximately $0.7 million which was settled in the third quarter of fiscal 2021. Upon termination, the remaining balance of $58,000 in accumulated other comprehensive loss related to the cross-currency interest rate swap was reclassified into earnings as the forecasted foreign currency interest payments will not occur.

The $0.2 million remaining balance in accumulated other comprehensive loss related to the interest rate swap is being amortized into earnings through the original term of the hedge relationship as the underlying floating interest rate debt still exists.

At October 29, 2022, we have fully reclassified all of the net losses on the frozen OCI balance from accumulated other comprehensive loss to earnings associated with the terminated interest rate swap due to the payment of variable interest associated with the floating interest rate debt.

The following table presents the impact of our derivative instruments in our condensed consolidated financial statements for the three and nine months ended October 29, 2022 and October 30, 2021:

		Three Months Ended
		Amount of Gain (Loss) Recognized in OCI on Derivative								Location of Gain (Loss) Reclassified from Accumulated OCI into Income				Amount of Gain (Loss) Reclassified from Accumulated OCI into Income
Cash Flow Hedge (In thousands)		October 29, 2022				October 30, 2021								October 29, 2022				October 30, 2021
Swap contracts		$	—			$	—				Other Expense			$	(19	)		$	(20	)

		Nine Months Ended
		Amount of Gain (Loss) Recognized in OCI on Derivative								Location of Gain (Loss) Reclassified from Accumulated OCI into Income				Amount of Gain (Loss) Reclassified from Accumulated OCI into Income
Cash Flow Hedge (In thousands)		October 29, 2022				October 30, 2021								October 29, 2022				October 30, 2021
Swap contracts		$	—			$	—				Other Expense			$	(59	)		$	(60	)

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- References

No definition available.

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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://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-URI https://asc.fasb.org/topic&trid=2229140

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 50
-Paragraph 5
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=126731327&loc=d3e90205-114008

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