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Derivative Instruments and Hedging Activities
 3 Months Ended
Mar. 30, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities Disclosure
The Company is exposed to various market risks, including risks associated with interest rates and foreign currency exchange rates. One objective of the Company's risk management program is to mitigate these risks using derivative instruments.
Cash Flow Hedges - Interest Rate Swap Contract
In July 2022, the Company entered into a floating-to-fixed swap agreement on its variable rate debt under our senior secured term loan facility due 2029 (the “Term Loan Facility”). The interest rate swap was designated specifically to the Term Loan Facility and qualifies as a cash flow hedge. The notional amount is scheduled to decrease quarterly and will expire on December 30, 2025. As cash flow hedges, unrealized gains are recognized as assets and unrealized losses are recognized as liabilities. Unrealized gains and losses are designated as effective or ineffective based on a comparison of the changes in fair value of the interest rate swaps and changes in fair value of the underlying exposures being hedged. The effective portion is recorded as a component of accumulated other comprehensive income (loss) and will be reflected in earnings during the period the hedged transaction effects earnings, while the ineffective portion is recorded as a component of interest expense.
Foreign Currency Contracts Not Designated as Hedges
The Company enters into foreign exchange contracts in an effort to mitigate the risks associated with currency fluctuations on certain foreign currency balance sheet exposures. These foreign exchange contracts do not qualify for hedge accounting. The Company recognizes the change in fair value of its foreign currency forward contracts in the condensed consolidated statement of operations.
The notional amounts of our derivative instruments are as follows:
(In thousands)
Derivatives designated as hedging instruments:March 30, 2024December 31, 2023
Interest rate swap contract - cash flow hedge$955,000 $1,350,000 
The fair values of our derivative instruments included in the condensed consolidated balance sheets are as follows:
(In thousands)
Condensed Consolidated Balance Sheet LocationDerivative Assets
Derivatives designated as hedging instruments - Interest rate swap contract - cash flow hedgeMarch 30, 2024December 31, 2023
Other current assets$18,135 $21,451 
Other assets - long-term 4,548 2,618 
The following table summarizes the effects of our derivative instruments on our condensed consolidated statements of operations:
(Gain) Loss Recognized in Condensed Consolidated Statements of Income
(In thousands)Three months ended
Derivatives designated as hedging instruments:
Condensed Consolidated Statements of Operations Location
March 30, 2024April 1, 2023
Interest rate swap contract-cash flow hedgeInterest expense, net$(11,301)$(7,913)
Derivatives not designated as hedging instruments:
Foreign exchange contractsOther expense, net$— $129 
The following table summarizes the effects of our derivative instruments on Accumulated Other Comprehensive Income:
Gain (Loss) recognized in Other Comprehensive Income (Loss)
(In thousands)Three months ended
Derivatives designated as hedging instruments:March 30, 2024April 1, 2023
Interest rate swap contract - Cash flow hedge$(1,073)$(9,955)
We expect approximately $18.1 to be reclassified from accumulated other comprehensive income into interest expense, net during the next twelve months related to our interest rate swap based on projected rates of the SOFR forward curve as of March 30, 2024.