XML 104 R27.htm IDEA: XBRL DOCUMENT v2.4.0.8
Derivative Financial Instruments (Tables)
 6 Months Ended
Mar. 31, 2014
Derivative [Line Items]  
Fair Value of Outstanding Derivative Contracts in Condensed Consolidated Balance Sheets
The fair value of outstanding derivative contracts recorded in the accompanying Condensed Consolidated Balance Sheets were as follows:
Asset Derivatives
 
Classification
 
March 31,
2014
 
September 30,
2013
Derivatives designated as hedging instruments:
 
 
 
 
 
 
Commodity swap and option agreements
 
Receivables, net
 
$
0.3

 
$
0.4

Commodity swap and option agreements
 
Other assets
 
0.1

 
—

Foreign exchange forward agreements
 
Receivables, net
 
2.0

 
1.7

Total asset derivatives designated as hedging instruments
 
 
 
2.4

 
2.1

Derivatives not designated as hedging instruments:
 
 
 
 
 
 
Commodity contracts
 
Receivables, net
 
—

 
3.7

Call options
 
Derivatives
 
271.5

 
221.8

Futures contracts
 
Derivatives
 
1.5

 
—

Foreign exchange contracts
 
Receivables, net
 
0.1

 
0.1

Foreign exchange embedded derivative included in asset-based loans
 
Receivables, net
 
1.2

 
—

Total asset derivatives
 
 
 
$
276.7

 
$
227.7
Pretax Impact of Derivative Instruments Designated as Cash Flow Hedges on Accompanying Condensed Consolidated Statements of Operations, and Within AOCI
The following table summarizes the pretax impact of derivative instruments designated as cash flow hedges on the accompanying Condensed Consolidated Statements of Operations, and within AOCI, for the three and six months ended March 31, 2014 and March 31, 2013:
Derivatives in Cash Flow Hedging Relationships
 
Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)
 
Amount of Gain (Loss) Reclassified from AOCI into Income (Effective Portion)
 
Amount of Gain ( Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing)
 
Classification
Three months ended
 
March 31,
2014
 
March 31,
2013
 
March 31,
2014
 
March 31,
2013
 
March 31,
2014
 
March 31,
2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
 
$
(1.0
)
 
$
(2.2
)
 
$
0.3

 
$
0.2

 
$
(0.2
)
 
$
(0.1
)
 
Consumer products cost of goods sold
Foreign exchange contracts
 
(0.1
)
 
0.1

 
—

 
0.2

 
—

 
—

 
Net consumer products sales
Foreign exchange contracts
 
(0.7
)
 
3.6

 
(0.3
)
 
(0.4
)
 
—

 
—

 
Consumer products cost of goods sold
Total
 
$
(1.8
)
 
$
1.5

 
$
—

 
$
—

 
$
(0.2
)
 
$
(0.1
)
 
 
Six months ended
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
 
$
0.1

 
$
(2.4
)
 
$
—

 
$
0.1

 
$
—

 
$
(0.1
)
 
Consumer products cost of goods sold
Foreign exchange contracts
 
0.1

 
0.6

 
0.1

 
0.3

 
—

 
—

 
Net consumer products sales
Foreign exchange contracts
 
(1.1
)
 
3.2

 
(1.0
)
 
(0.9
)
 
—

 
—

 
Consumer products cost of goods sold
Total
 
$
(0.9
)
 
$
1.4

 
$
(0.9
)
 
$
(0.5
)
 
$
—

 
$
(0.1
)
 
 
Summary of Gain (Loss) Recognized in Income on Derivatives
During the three and six months ended March 31, 2014 and March 31, 2013, the Company recognized the following gains (losses) on these derivatives:
Derivatives Not Designated as Hedging Instruments
 
Gain (Loss) Recognized in Income on Derivatives
 
Classification
 
 
Three months ended
 
Six months ended
 
 
 
 
March 31,
2014
 
March 31,
2013
 
March 31,
2014
 
March 31,
2013
 
 
Equity conversion feature of preferred stock
 
$
(3.5
)
 
$
(39.6
)
 
$
(50.7
)
 
$
29.3

 
(Loss) gain from the change in the fair value of the equity conversion feature of preferred stock
Oil and natural gas commodity contracts
 
(6.8
)
 
(8.8
)
 
(10.2
)
 
(8.8
)
 
Other expense, net
Commodity contracts
 
—

 
—

 
(0.1
)
 
—

 
Consumer products cost of goods sold
Foreign exchange contracts
 
(0.2
)
 
1.8

 
0.6

 
(2.3
)
 
Other expense, net
Foreign exchange embedded derivative included in asset-based loans
 
1.2

 
—

 
1.2

 
—

 
Other expense, net
Call options
 
21.2

 
118.5

 
135.5

 
97.6

 
Net investment gains
Futures contracts
 
1.3

 
13.7

 
14.4

 
9.0

 
Net investment gains
FIA embedded derivatives

 
74.0

 
(122.6
)
 
174.3

 
(88.8
)
 
Benefits and other changes in policy reserves
Total
 
$
87.2

 
$
(37.0
)
 
$
265.0

 
$
36.0

 
 
Volumes and Fair Value of Oil and Natural Gas Derivative Financial Instruments
The following table presents our proportionate share of the EXCO/HGI JV’s volumes and fair value of the oil and natural gas derivative financial instruments as of March 31, 2014 (presented on a calendar-year basis) : 
(in millions, except volumes and prices)
 
Volume Mmmbtus/Mbbls
 
Weighted average strike price per Mmbtu/Bbl
 
March 31,
2014
Natural gas:
 
 
 
 
 
 
Swaps:
 
 
 
 
 
 
Remainder of 2014
 
12,272.0

 
$
4.15

 
$
(3.8
)
Total natural gas
 
12,272.0

 
 
 
$
(3.8
)
Oil:
 
 
 
 
 
 
Swaps:
 
 
 
 
 
 
Remainder of 2014
 
205.0

 
$
91.87

 
$
(1.2
)
Total oil
 
205.0

 
 
 
$
(1.2
)
Total oil and natural gas derivatives
 
 
 
 
 
$
(5.0
)
Call options [Member]
  
Derivative [Line Items]  
FGL's Exposure to Credit Loss on Call Options Held
Information regarding FGL’s exposure to credit loss on the call options it holds is presented in the following table:
 
 
 
 
March 31, 2014
 
September 30, 2013
Counterparty
 
Credit Rating
(Moody's/S&P) (a)
 
Notional
Amount
 
Fair Value
 
Collateral
 
Net Credit Risk
 
Notional
Amount
 
Fair Value
 
Collateral
 
Net Credit Risk
Merrill Lynch
 
A/A
 
$
2,018.2

 
$
83.0

 
$
41.1

 
$
41.9

 
$
2,037.8

 
$
70.7

 
$
—

 
$
70.7

Deutsche Bank
 
A2/A
 
2,265.3

 
81.9

 
45.7

 
36.2

 
1,620.4

 
51.7

 
23.0

 
28.7

Morgan Stanley
 
A3/A
 
2,143.3

 
89.9

 
63.2

 
26.7

 
2,264.1

 
75.7

 
49.0

 
26.7

Royal Bank of Scotland
 
BBB+/Baa2
 
114.7

 
8.1

 
—

 
8.1

 
364.3

 
20.3

 
—

 
20.3

Barclay's Bank
 
A2/A
 
260.4

 
8.6

 
—

 
8.6

 
120.8

 
3.4

 
—

 
3.4

 
 
 
 
$
6,801.9

 
$
271.5

 
$
150.0

 
$
121.5

 
$
6,407.4

 
$
221.8

 
$
72.0

 
$
149.8