Derivative Instruments and Hedging Activities (Tables)

3 Months Ended

Apr. 03, 2022

Schedule of Interest Rate Derivative Agreements

The following tables summarize the Company’s interest rate derivative agreements as of April 3, 2022:

Effective date	Expiration date	Interest rate cap amount	Notional amount (a)		Hedge designation
December 31, 2020	December 31, 2023	3.5%	$	1,000.0	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	$	1,000.0	Cash Flow Hedge

(a)The notional value of this instrument is expected to be $500.0 million in fiscal 2023.

Schedule of Currency Hedging Instruments Outstanding

The following table provides details of the currency hedging instruments outstanding as of April 3, 2022:

Description	Notional amount		Hedge designation
Foreign currency forward contracts	$	356.4	Cash Flow Hedge
Foreign currency forward contracts		333.2	Not 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 ended April 3, 2022 and April 4, 2021 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 April 3, 2022
Cash flow hedges:
Foreign currency forward contracts	$	1.5		Cost of revenue, excluding amortization of intangible assets	$	(1.3	)
Interest rate derivative contracts		(16.8	)	Interest expense, net		4.6
Net investment hedges:
Foreign currency-denominated debt(a)		(8.9	)	N/A	N/A
Fiscal Quarter Ended April 4, 2021
Cash flow hedges:
Foreign currency forward contracts	$	(3.5	)	Cost of revenue, excluding amortization of intangible assets	$	0.1
Interest rate derivative contracts		(3.3	)	Interest expense, net		9.1

(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.

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 April 3, 2022					Fiscal Quarter Ended April 4, 2021
	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:	$	32.5	$	249.5			$	43.4	$	248.2
Effects of cash flow hedging relationships
Loss (Gain) on cash flow hedging relationships
Foreign currency forward contracts:
Amount of loss (gain) reclassified from     AOCI into income	N/A		$	(1.3	)		N/A		$	0.1
Amount reclassified from AOCI into income     due to forecast transaction that is no      longer probable of occurring	N/A		$	—			N/A		$	—
Interest rate derivative contracts:
Amount of net loss reclassified from AOCI     into income	$	4.6	N/A				$	9.1	N/A
Amount reclassified from AOCI     into income due to a forecast transaction     that is no longer probable of occurring (a)	$	—	N/A				$	3.7	N/A

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

Not Designated as Hedging Instrument

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

Fair value (gains) and losses of derivative contracts, as determined using Level 2 inputs, that do not qualify for hedge accounting treatment are recorded in other expense, net and were as follows:

	Fiscal Quarter Ended
	April 3, 2022			April 4, 2021
Interest rate cap derivatives	$	(1.9	)	$	0.2
Foreign currency derivatives		8.3			30.4
Cross currency swaps		—			(24.0	)

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.

	April 3, 2022		January 2, 2022
Interest rate derivatives:
Other liabilities	$	2.4	$	5.2
Foreign currency forward contracts:
Other current assets		0.6		0.9
Accrued liabilities		3.7		1.1

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.

	April 3, 2022		January 2, 2022
Interest rate derivatives:
Other assets	$	6.7	$	—
Other liabilities		—		13.9
Foreign currency forward contracts:
Other current assets		7.6		4.5
Accrued liabilities		8.7		4.3