Derivative Instruments and Hedging Activities (Tables)

9 Months Ended

Oct. 03, 2021

Schedule of Interest Rate Derivative Agreements

The following tables summarize the Company’s interest rate derivative agreements as of October 3, 2021:

Effective date	Expiration date	Interest rate cap amount	Notional amount		Hedge designation
December 31, 2020	December 31, 2023	3.5%	$	1,500.0	Non-designated

Effective date	Expiration date	Description	Fixed rate	Floating rate	Notional amount(a)		Hedge designation
September 27, 2019	December 31, 2023	Pay fixed, receive float	1.635%	1-month LIBOR rate	$	1,500.0	Cash Flow Hedge

(a)The notional value of this instrument is expected to be $1,000 million in fiscal 2022 and $500 million in fiscal 2023.

Schedule of Currency Hedging Instruments Outstanding

The following table provides details of the currency hedging instruments outstanding as of October 3, 2021:

Description	Notional amount		Hedge designation
Foreign Currency Forward Contracts	$	161.5	Cash Flow Hedge
Foreign Currency Forward Contracts		262.2	Non-designated

Schedule of Gains and Losses from Designated Derivative and Non-derivative Instruments

Gains and losses from designated derivative and non-derivative instruments within AOCI during the fiscal quarter and nine months ended October 3, 2021 and September 27, 2020 were recorded as follows:

Designated Hedging Instruments	Amount of loss (gain) recognized in OCI on hedges			Location of amounts reclassified from AOCI into income	Amount of loss (gain) reclassified from AOCI into income
Fiscal Quarter Ended October 3, 2021
Cash flow hedges:
Foreign currency forward contracts	$	(1.0	)	Cost of revenue, excluding amortization of intangible assets	$	1.1
Interest rate derivative contracts		—		Interest expense, net		5.9
Net investment hedges:
Foreign currency-denominated debt(a)		0.8		N/A	N/A
Fiscal Nine Months Ended October 3, 2021
Cash flow hedges:
Foreign currency forward contracts	$	(3.7	)	Cost of revenue, excluding amortization of intangible assets	$	2.7
Interest rate derivative contracts		(1.8	)	Interest expense, net		20.9
Net investment hedges:
Foreign currency-denominated debt(a)		3.8		N/A	N/A

(a)The amount of loss (gain) recognized in OCI for the foreign-currency denominated debt is presented within the CTA component of OCI. These gains and losses will remain in CTA until the related hedged item affects earnings, which would occur upon disposal or complete or substantial liquidation of the underlying hedged entities.

Designated Hedging Instruments	Amount of loss (gain) recognized in OCI on hedges			Location of amounts reclassified from AOCI into income	Amount of loss (gain) reclassified from AOCI into income
Fiscal Quarter Ended September 27, 2020
Cash flow hedges:
Foreign currency forward contracts	$	1.5		Cost of revenue, excluding amortization of intangible assets	$	(2.0	)
Interest rate derivative contracts		(0.5	)	Interest expense, net		0.5
Fiscal Nine Months Ended September 27, 2020
Cash flow hedges:
Foreign currency forward contracts	$	(2.2	)	Cost of revenue, excluding amortization of intangible assets	$	(4.5	)
Interest rate derivative contracts(a)		47.1		Interest expense, net		(1.9	)

(a)For the fiscal nine months ended September 27, 2020, the $47.1 million loss recognized in OCI for the interest rate derivative contracts does not include the $3.7 million loss from the cumulative effect of change in accounting standard, which is presented in Note 18.

Schedule of Designated Derivative Instruments within Interest Expense, Net and Cost of Revenue, Excluding Amortization of Intangible Assets in Statements of Operations

The following tables present the effect of the Company’s designated derivative instruments within Interest expense, net and Cost of revenue, excluding amortization of intangible assets in the unaudited consolidated statements of operations:

	Fiscal quarter ended October 3, 2021				Fiscal quarter ended September 27, 2020
	Interest expense, net		Cost of revenue, excluding amortization of intangible assets			Interest expense, net		Cost of revenue, excluding amortization of intangible assets
Total amount of line item in unaudited consolidated statements of operations where effects of hedges are presented:	$	36.1	$	252.4		$	48.9	$	234.1
Effects of cash flow hedging relationships
Foreign currency forward contracts:
Amount of loss (gain) reclassified from AOCI into income	N/A			1.1		N/A			(2.0	)
Amount reclassified from AOCI into income due to forecast transaction that is no longer probable of occurring	N/A			—		N/A			(0.1	)
Interest rate derivative contracts:
Amount of net loss reclassified from AOCI into income		5.9	N/A				0.5	N/A

	Fiscal nine months ended October 3, 2021				Fiscal nine months ended September 27, 2020
	Interest expense, net		Cost of revenue, excluding amortization of intangible assets			Interest expense, net			Cost of revenue, excluding amortization of intangible assets
Total amount of line item in unaudited consolidated statements of operations in which effects of hedges are presented:	$	112.5	$	748.7		$	148.6		$	650.2
Effects of cash flow hedging relationships
Foreign currency forward contracts:
Amount of loss (gain) reclassified from AOCI into income	N/A			2.7		N/A				(4.5	)
Amount reclassified from AOCI into income due to forecast transaction that is no longer probable of occurring	N/A			—		N/A				(0.2	)
Interest rate derivative contracts:
Amount of loss (gain) reclassified from AOCI into income		20.9	N/A				(1.9	)	N/A
Amount reclassified from AOCI into income due to forecast transaction that is no longer probable of occurring(a)		3.7	N/A				—		N/A

(a) The amount is included within the total amount of loss (gain) reclassified from accumulated OCI into income.

Not Designated as Hedging Instrument

Schedule of Gains and Losses from Designated Derivative and Non-derivative Instruments

The following table presents mark-to-market (gains) and losses on non-designated derivatives recognized currently within the unaudited consolidated statements of operations:

	Location of amounts	Fiscal Quarter Ended					Fiscal Nine Months Ended
Non-designated hedging instruments	recognized in earnings on derivatives	October 3, 2021			September 27, 2020		October 3, 2021			September 27, 2020
Interest rate derivative contracts	Other expense, net	$	0.1		$	0.4	$	—		$	1.3
Foreign currency forward contracts	Other expense, net		(1.6	)		1.5		32.6			3.1
Cross-currency interest rate swap contracts	Other expense, net		—			2.5		(24.0	)		(2.6	)

Location and Fair Values of Designated and Non-Designated Hedging Instruments Recognized within Consolidated Balance Sheets

The following table presents the location and fair values of non-designated hedging instruments recognized within the unaudited consolidated balance sheets. The fair values of non-designated hedging instruments have been determined using Level 2 inputs.

	October 3, 2021		January 3, 2021
Interest rate derivative contracts:
Accrued liabilities	$	—	$	0.1
Other liabilities		6.8		11.1
Foreign currency forward contracts:
Other current assets		1.7		0.3
Accrued liabilities		0.7		0.1
Cross currency interest rate swap contracts:
Other current assets		—		2.0
Other liabilities		—		10.8

Designated as Hedging Instrument

Location and Fair Values of Designated and Non-Designated Hedging Instruments Recognized within Consolidated Balance Sheets

The following table presents the location and fair values of designated hedging instruments recognized within the unaudited consolidated balance sheets. The fair values of designated hedging instruments have been determined using Level 2 inputs.

	October 3, 2021		January 3, 2021
Interest rate derivative contracts:
Accrued liabilities	$	0.1	$	0.1
Other liabilities		25.4		44.1
Foreign currency forward contracts:
Other current assets		3.8		4.2
Accrued liabilities		2.4		10.0