Derivative Financial Instruments

3 Months Ended

Jan. 25, 2013

Derivative Financial Instruments [Abstract]

Derivative Financial Instruments

NOTE 8 – DERIVATIVE FINANCIAL INSTRUMENTS

We use derivative financial instruments to manage well-defined interest rate and foreign currency exchange risks. We enter into derivative financial instruments with high-credit quality counterparties and diversify our positions among such counterparties to reduce our exposure to credit losses. We do not have any credit-risk-related contingent features in our derivative contracts as of January 25, 2013.

At January 25, 2013, we had $6,412notional amount of foreign currency contracts that mature during fiscal year 2013. These foreign currency contracts have been designated as cash flow hedges with unrealized gains or losses recorded in accumulated other comprehensive income (loss). Gains and losses are reclassified from accumulated other comprehensive income (loss) to other expense (income) in the Statement of Operations when the underlying hedged item is realized. At January 27, 2012, we had $10,010 notional amount of foreign currency contracts maturing in fiscal year 2012. There was no material ineffectiveness related to these hedges during the quarters ended January 25, 2013 or January 27, 2012.

At January 25, 2013, we had no treasury lock contracts in place. During the first quarter of 2012, we settled $200,000 notional amount of treasury lock contracts as a result of issuing $400,000 of Senior Notes, yielding a pretax loss of $27,875. This loss was recognized net of tax, in accumulated other comprehensive income (loss) in the first quarter of fiscal year 2012. The accumulated other comprehensive loss amount in our Condensed Consolidated Balance Sheets as of January 25, 2013 and January 27, 2012 represents the unamortized gains and losses, net of tax, from our settled contracts. Unamortized gains and loss are reclassified ratably to interest expense in our Condensed Consolidated Statements of Operations over the term of the related debt. There was no material ineffectiveness related to these hedges for the quarters ended January 25, 2013 and January 27, 2012.

Our derivative assets and liabilities subject to fair value measurement (see Note 7) include the following:

	Fair Value at January 25, 2013		Fair Value at October 26, 2012		Fair Value at January 27, 2012
Assets
Prepaid expenses and other:
Foreign currency contracts	$	—	$	16	$	157
Total Assets	$	—	$	16	$	157
Liabilities
Accrued liabilities other:
Foreign currency contracts	$	5	$	—	$	—
Total Liabilities	$	5	$	—	$	—

Derivative gains (losses) recognized in AOCI¹ and on the Condensed Consolidated Statements of Operations for the quarters ended January 25, 2013 and January 27, 2012, respectively, are as follows:

Quarter Ended January 25, 2013	Amount of Gain (Loss) recognized in AOCI1			Statement of Operations Classification	Gain (Loss) in Income1
Derivatives designated as cash flow hedges
Foreign currency contracts	$	(20	)	Other income / (expense), net	$	(55	)
Treasury lock contracts		319		Interest expense		(319	)
Total derivatives designated as cash flow hedges	$	299		Total	$	(374	)
Quarter Ended January 27, 2012	Amount of Gain (Loss) recognized in AOCI1			Statement of Operations Classification	Gain (Loss) in Income1
Derivatives designated as cash flow hedges
Foreign currency contracts	$	154		Other income / (expense), net	$	182
Treasury lock contracts		(8,028	)	Interest expense		157
Total derivatives designated as cash flow hedges	$	(7,874	)	Total	$	339

¹ Accumulated other comprehensive income (loss) (AOCI) is included in the Condensed Consolidated Balance Sheets in the Stockholders' Equity section and is reported net of tax. The amounts disclosed in the above table are reported pretax and represent the quarterly derivative activity.