Derivative Instruments

12 Months Ended

Dec. 31, 2024

Derivative Instruments

Derivative Instruments

17. Derivative Instruments

Derivatives Designated as Hedging Instruments

Net Investment Hedges

In September 2022 and November 2024, we entered into cross-currency interest rate swaps, which effectively convert a portion of our U.S. dollar-denominated fixed-rate debt to foreign currency-denominated fixed-rate debt in order to hedge the currency exposure associated with our net investment in foreign subsidiaries. As of December 31, 2024 and 2023, we had cross-currency interest rate swaps outstanding with notional amounts of approximately $2.1 billion and maturity dates ranging through 2029.

The effect of these net investment hedges on accumulated other comprehensive loss and the consolidated income statements for the years ended December 31, 2024, 2023 and 2022 was as follows (in thousands):

		Year Ended December 31,
		2024		2023		2022
Cross-currency interest rate swaps (included component) (1)		$	136,880	$	(22,703)	$	(116,550)
Cross-currency interest rate swaps (excluded component) (2)			(22,841)		(25,428)		7,929
Total		$	114,039	$	(48,131)	$	(108,621)
	Location of	Year Ended December 31,
	gain or (loss)	2024		2023		2022
Cross-currency interest rate swaps (excluded component) (2)	Interest expense	$	25,037	$	21,836	$	6,260

(1) Included component represents foreign exchange spot rates.

(2) Excluded component represents cross-currency basis spread and interest rates.

Cash Flow Hedges  

As of December 31, 2024, we had derivatives designated as cash flow hedges on 100% of the Euro Term Loan Facilities (€375 million notional amount). Amounts reported in Accumulated other comprehensive loss related to interest rate swaps are reclassified to interest expense as interest payments are made on our debt. As of December 31, 2023, we estimate that an additional $0.5 million will be reclassified as a decrease to interest expense during the year ending December 31, 2025, when the hedged forecasted transactions impact earnings.

The effect of these cash flow hedges on accumulated other comprehensive loss and the consolidated income statements for the years ended December 31, 2024, 2023 and 2022, was as follows (in thousands):

	Year Ended December 31,
	2024		2023		2022
Interest rate swaps	$	(5,439)	$	(7,221)	$	7,774

Location of Year Ended December 31, 

	gain or (loss)	2024		2023		2022
Interest rate swaps	Interest expense	$	15,027	$	10,953	$	819

Fair Value of Derivative Instruments

The subsequent table presents the fair value of derivative instruments recognized in our consolidated balance sheets as of December 31, 2024 and 2023 (in thousands):

	December 31, 2024				December 31, 2023
	Assets (1)		Liabilities (2)		Assets (1)		Liabilities (2)
Cross-currency interest rate swaps	$	32,883	$	75,597	$	—	$	156,753
Interest rate swaps		6,130		11,253		8,538		—
	$	39,013	$	86,850	$	8,538	$	156,753

(1) As presented in our consolidated balance sheets within Other assets.

(2) As presented in our consolidated balance sheets within Accounts payable and other Accrued liabilities.

Credit-Risk Related Contingent Features

Upon entering into derivatives, we have agreements with each of our derivative counterparties that contain a provision where we could be declared in default on our derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to our default on the indebtedness.