Derivative Financial Instruments

3 Months Ended

Jan. 24, 2014

Derivative Financial Instruments [Abstract]

Derivative Financial Instruments

NOTE 7 – DERIVATIVE FINANCIAL INSTRUMENTS

We use derivative financial instruments to manage 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 24, 2014.

At January 24, 2014, we had $21,133 notional amount of foreign currency contracts that mature during fiscal year 2014. 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 25, 2013, we had $6,412 notional amount of foreign currency contracts maturing in fiscal year 2013. There was no material ineffectiveness related to these hedges during the quarters ended January 24, 2014 or January 25, 2013.

At January 24, 2014 and January 25, 2013, we had no treasury lock contracts in place. The accumulated other comprehensive loss amount in our Condensed Consolidated Balance Sheets as of January 24, 2014 and January 25, 2013 represents the unamortized gains and losses, net of tax, from treasury lock contracts settled in the first quarter of 2012. Unamortized gains and loss are reclassified ratably to interest expense in our Condensed Consolidated Statements of Operations over the term of the related debt.

Our derivative assets and liabilities subject to fair value measurement (see Note 6) include the following:

		Fair Value at		Fair Value at		Fair Value at
		January 24, 2014		October 25, 2013		January 25, 2013
Assets
Prepaid expenses and other:
Foreign currency contracts	$	—	$	—	$	—
Total Assets	$	—	$	—	$	—
Liabilities
Accrued liabilities other:
Foreign currency contracts	$	398	$	145	$	5
Total Liabilities	$	398	$	145	$	5

Derivative gains (losses) recognized in AOCI¹ and on the Condensed Consolidated Statements of Operations for the quarters ended January 24, 2014 and January 25, 2013, respectively, were as follows:

		Amount of Gain
		(Loss)
		recognized in		Statement of Operations		Gain (Loss) in
Quarter Ended January 24, 2014		AOCI1		Classification		Income1
Derivatives designated as cash flow hedges
Foreign currency contracts	$	(253	)	Other income / (expense), net	$	(116	)
Treasury lock contracts		320		Interest expense		(320	)
Total derivatives designated as cash flow hedges	$	67		Total	$	(436	)
		Amount of Gain
		(Loss)
		recognized in		Statement of Operations		Gain (Loss) in
Quarter Ended January 25, 2013		AOCI1		Classification		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	)

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.