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Hedging Transactions And Derivative Financial Instruments
 3 Months Ended
Mar. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Hedging Transactions and Derivative Financial Instruments HEDGING TRANSACTIONS AND DERIVATIVE FINANCIAL INSTRUMENTS
The Company uses cross-currency swap derivative contracts to partially hedge its net investments in foreign operations against adverse movements in exchange rates between the U.S. dollar and the euro. The cross-currency swap derivative contracts are agreements to exchange fixed-rate payments in one currency for fixed-rate payments in another currency. On January 17, 2023, the Company entered into a two-year cross-currency swap derivative contract, with a notional value of $150.0 million, with respect to its $650.0 million senior term loan facility. This contract effectively converts a portion of the $650.0 million senior term loan facility to an obligation denominated in euros and partially offsets the impact of changes in currency rates on foreign currency denominated net investments. This instrument matures on January 17, 2025.

The Company also has foreign currency denominated long-term debt in the amount of €208.0 million. This senior euro term loan facility represents a partial hedge of the Company’s net investment in foreign operations against adverse movements in exchange rates between the U.S. dollar and the euro. The senior euro term loan facility is designated and qualifies as a non-derivative hedging instrument. The senior euro term loan facility matures in September 2024. Refer to Note 13 for further discussion of the senior euro term loan facility.

The change in the fair value of the cross-currency swap instrument and the foreign currency translation of the senior euro term loan facility are recorded in accumulated other comprehensive loss in equity, in the accompanying Condensed Consolidated Balance Sheets, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in accumulated other comprehensive loss as reflected in Note 14.

The Company has also used interest rate swap derivative contracts to reduce its variability of cash flows related to interest payments with respect to its senior term and senior euro term loan facilities. The interest rate swap contracts exchanged interest payments based on variable rates for interest payments based on fixed rates. The changes in the fair value of these instruments were recorded in accumulated other comprehensive loss in equity (see Note 14). The Company did not have any outstanding interest rate swap contracts as of March 31, 2023.

Any ineffective portions of the above net investment and cash flow hedges were reclassified from accumulated other comprehensive loss into income during the period of change. Additionally, the interest income or expense from the cross-currency and interest rate swaps were recorded in interest expense, net in the Company’s Condensed Consolidated Statements of Operations consistent with the classification of interest expense attributable to the underlying debt.
The following table summarizes the notional values as of March 31, 2023 and April 1, 2022 and pretax impact of changes in the fair values of instruments designated as net investment and cash flow hedges in accumulated other comprehensive loss (“OCI”) for the three months ended March 31, 2023 and April 1, 2022 ($ in millions):
Notional AmountLoss Recognized in OCI
Three Months Ended March 31, 2023
Foreign currency denominated debt$225.5 $(2.8)
Foreign currency contracts150.0 — 
Total$375.5 $(2.8)
Notional AmountGain Recognized in OCI
Three Months Ended April 1, 2022
Foreign currency denominated debt$229.7 $6.8 
Foreign currency contracts650.0 17.9 
Interest rate contracts250.0 1.8 
Total$1,129.7 $26.5 

The Company did not reclassify any deferred gains or losses related to net investment and cash flow hedges from accumulated other comprehensive loss to income during the three months ended March 31, 2023 and April 1, 2022. In addition, the Company did not have any ineffectiveness related to net investment and cash flow hedges during the three months ended March 31, 2023 and April 1, 2022. The cash inflows and outflows associated with the Company’s derivative contracts designated as net investment hedges are classified in investing activities in the accompanying Condensed Consolidated Statements of Cash Flows.

The Company’s derivative instruments, as well as its non-derivative debt instruments designated and qualifying as net investment hedges, were classified in the Company’s Condensed Consolidated Balance Sheets as follows ($ in millions):
March 31, 2023December 31, 2022
Derivative liabilities:
Accrued expenses and other liabilities$— $— 
Nonderivative hedging instruments:
Long-term debt$225.5 $222.7 
Amounts related to the Company’s derivatives expected to be reclassified from accumulated other comprehensive loss to net income during the next 12 months are not significant.