13. ACCUMULATED OTHER COMPREHENSIVE LOSS AND OTHER COMPREHENSIVE LOSS
Accumulated other comprehensive loss includes foreign currency translation of assets and liabilities of foreign subsidiaries, effects of exchange rate changes on intercompany balances of a long-term nature, unrealized gains and losses on derivative financial instruments designated as cash flow hedges and adjustments to pension liabilities. Amounts recorded in accumulated other comprehensive loss, net of tax, as of June 30, 2013 and December 31, 2012, and changes within the period are as follows:
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(In millions) |
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Foreign
Currency
Items |
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Derivative
Cash Flow
Hedges |
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Accrued
Pension
Benefit
Liability |
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Accumulated
Other
Comprehensive
Loss |
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Balance at December 31, 2012 |
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$ |
26.7 |
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$ |
- |
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$ |
(48.6 |
) |
$ |
(21.9 |
) |
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Other comprehensive income (loss) before reclassifications |
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(17.7 |
) |
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(0.9 |
) |
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1.2 |
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(17.4 |
) |
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Less: amounts reclassified from accumulated other comprehensive income into net income |
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- |
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- |
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0.4 |
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0.4 |
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Net current period other comprehensive income (loss) |
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(17.7 |
) |
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(0.9 |
) |
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0.8 |
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(17.8 |
) |
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Balance at June 30, 2013 |
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$ |
9.0 |
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$ |
(0.9 |
) |
$ |
(47.8 |
) |
$ |
(39.7 |
) |
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Other comprehensive loss is derived from adjustments to reflect the unrealized loss on derivatives, change in pension liability adjustment and change in foreign currency translation adjustment. The components of other comprehensive loss for the three and six month periods ended June 30, 2013 and 2012 are as follows:
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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(In millions) |
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2013 |
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2012 |
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2013 |
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2012 |
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Affected Line Items on the
Condensed Consolidated
Statements of Income |
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Change in foreign currency translation adjustment: |
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Currency translation adjustments |
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$ |
(15.0 |
) |
$ |
(8.7 |
) |
$ |
(26.6 |
) |
$ |
(1.8 |
) |
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Tax benefit |
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(5.5 |
) |
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(4.3 |
) |
$ |
(8.9 |
) |
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(0.8 |
) |
Provision for income taxes |
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Change in foreign currency translation adjustment, net of tax |
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$ |
(9.5 |
) |
$ |
(4.4 |
) |
$ |
(17.7 |
) |
$ |
(1.0 |
) |
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Unrealized gain on derivatives: |
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Commodity hedge contracts |
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$ |
- |
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$ |
2.1 |
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$ |
- |
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$ |
0.7 |
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Cost of sales |
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Interest rate swaps |
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(0.9 |
) |
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- |
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$ |
(0.9 |
) |
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- |
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Pre-tax amount |
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$ |
(0.9 |
) |
$ |
2.1 |
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$ |
(0.9 |
) |
$ |
0.7 |
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Tax expense |
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- |
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0.8 |
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$ |
- |
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0.3 |
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Provision for income taxes |
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Change in unrealized gain (loss) on derivatives, |
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$ |
(0.9 |
) |
$ |
1.3 |
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$ |
(0.9 |
) |
$ |
0.4 |
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Change in pension liability adjustment: |
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Adjustments to pension liabilities |
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$ |
0.5 |
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$ |
0.4 |
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$ |
1.1 |
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$ |
0.8 |
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Cost of sales/selling, general and administrative expenses |
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Tax expense |
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0.2 |
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0.2 |
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$ |
0.3 |
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0.2 |
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Provision for income taxes |
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Pension liability adjustment, net of tax |
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$ |
0.3 |
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$ |
0.2 |
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$ |
0.8 |
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$ |
0.6 |
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Other comprehensive loss, before income taxes |
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$ |
(15.4 |
) |
$ |
(6.2 |
) |
$ |
(26.4 |
) |
$ |
(0.3 |
) |
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Total tax benefit for the period |
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(5.3 |
) |
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(3.3 |
) |
$ |
(8.6 |
) |
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(0.3 |
) |
Provision for income taxes |
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Other comprehensive loss, net of tax |
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$ |
(10.1 |
) |
$ |
(2.9 |
) |
$ |
(17.8 |
) |
$ |
- |
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