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Venezuela
6 Months Ended
Jun. 30, 2015
Foreign Currency [Abstract]  
Venezuela
Venezuela

Venezuela has been designated hyper-inflationary and, therefore, the functional currency for the Company’s Venezuelan subsidiary (“CP Venezuela”) is the U.S. dollar and Venezuelan currency fluctuations are reported in income.

In February 2015, the Venezuelan government implemented changes in Venezuela’s foreign exchange regime. While the official exchange rate, as determined by the National Center for Foreign Commerce (“CENCOEX”), remained at 6.30 bolivares per dollar, and the SICAD I (Supplementary System for the Administration of Foreign Currency) currency market, now known as SICAD, was unchanged, the SICAD II market was eliminated and a new, alternative currency market, the Foreign Exchange Marginal System (“SIMADI”), was created and became operational with a floating exchange rate determined by market participants.

The Company remeasures the financial statements of CP Venezuela at the end of each month at the rate at which it expects to remit future dividends which, based on the advice of legal counsel, is currently the SICAD rate. During the second quarter of 2015, the SICAD rate devalued to 12.80 bolivares per dollar as of June 30, 2015 from 12.00 bolivares per dollar as of March 31, 2015. The Company remeasured CP Venezuela’s local currency-denominated net monetary assets at June 30, 2015 at the rate of 12.80 bolivares per dollar and, as a result, incurred a pretax loss of $16 ($10 aftertax loss or $0.01 per diluted common share).

During the second quarter of 2014, the SICAD I rate revalued slightly and the Company remeasured CP Venezuela’s local currency-denominated net monetary assets at the quarter-end SICAD I rate of 10.60 bolivares per dollar. The impact of the remeasurement during the quarter was insignificant in relation to the Company’s consolidated Net income. During the first quarter of 2014, the Company incurred pretax losses of $266 ($174 aftertax losses or $0.19 per diluted common share) related to the remeasurement of CP Venezuela’s local currency-denominated net monetary assets at the quarter-end SICAD I rate of 10.70 bolivares per dollar.

Included in the remeasurement losses during the second quarter of 2015 and the first quarter of 2014 were charges related to the devaluation-protected bonds issued by the Venezuelan government and held by CP Venezuela. Because the official exchange rate remained at 6.30 bolivares per dollar, the devaluation-protected bonds did not revalue at the rate available on the SICAD currency market but remained at the official exchange rate, resulting in an impairment in the fair value of the bonds.

CP Venezuela funds its requirements for imported goods through a combination of U.S. dollars obtained from CENCOEX and intercompany borrowings. Because most of the products in CP Venezuela’s portfolio have been designated as “essential” by the Venezuelan government, historically CP Venezuela’s access to U.S. dollars at the official rate of 6.30 bolivares per dollar has generally been sufficient to settle most of its U.S. dollar obligations for imported materials and the gains related to such transactions are recorded when the funds are authorized by CENCOEX and the liabilities are paid. The decline in the price of oil has contributed to a reduced availability of U.S. dollars in Venezuela and, recently, CP Venezuela’s supply of U.S. dollars to fund imports has become even more limited and sporadic.

Although the SIMADI market was accessible to CP Venezuela, it did not participate in that market through June 30, 2015. Since its inception, the volume of transactions in the SIMADI market has been very limited and the exchange rate at June 30, 2015 was 197.30 bolivares per dollar.

For the six months ended June 30, 2015, CP Venezuela represented approximately 4% of the Company’s consolidated Net sales. At June 30, 2015, CP Venezuelas local currency-denominated net monetary asset position, which would be subject to remeasurement in the event of further changes in the SICAD rate, was $602. This amount includes the devaluation-protected bonds issued by the Venezuelan government. CP Venezuelas net non-monetary assets were $296 at June 30, 2015, including $231 of fixed assets, that could be subject to impairment if CP Venezuela is not able to implement further price increases to offset the impacts of continued high inflation or further devaluations, or if it does not have sufficient access to U.S. dollars from CENCOEX or the SICAD market to fund imports. At June 30, 2015, the Company’s total investment in CP Venezuela was $1,009, which included intercompany payables of CP Venezuela.