Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2020

Investments, All Other Investments [Abstract]

Carrying Amount and Estimated Fair Values of Financial Instruments

The carrying values and the estimated fair values of financial instruments at June 30, 2020 and December 31, 2019 consisted of the following:


	June 30, 2020						December 31, 2019
(DOLLARS IN THOUSANDS)	Carrying Value		Fair Value		Carrying Value		Fair Value
LEVEL 1
Cash and cash equivalents⁽¹⁾	$	497,412	$	497,412	$	606,823	$	606,823
LEVEL 2
Credit facilities and bank overdrafts⁽²⁾	1,107		1,107		3,131		3,131
Derivatives
Derivative assets⁽³⁾	7,325		7,325		3,575		3,575
Derivative liabilities⁽³⁾	3,982		3,982		7,415		7,415

Long-term debt:⁽⁴⁾
2020 Notes	299,816		301,603		299,381		302,700
2021 Euro Notes	336,274		336,315		334,561		338,244
2023 Notes	299,156		312,150		299,004		305,580
2024 Euro Notes	560,644		575,264		558,124		586,825
2026 Euro Notes	893,879		903,554		890,183		945,306
2028 Notes	396,845		453,849		396,688		441,500
2047 Notes	493,782		537,466		493,571		526,106
2048 Notes	786,105		936,682		785,996		919,040
Term Loan⁽²⁾	239,723		240,000		239,621		240,000
Amortizing Notes⁽⁵⁾	59,513		60,372		82,079		84,430

_______________________

(1)The carrying amount of cash and cash equivalents approximates fair value due to the short maturity of those instruments.

(2)The carrying amount approximates fair value as the interest rate is reset frequently based on current market rates as well as the short maturity of those instruments.

(3)The carrying amount approximates fair value as the instruments are marked-to-market and held at fair value on the Consolidated Balance Sheet.

(4)The fair value of the Company's long-term debt was calculated using discounted cash flows applying current interest rates and current credit spreads based on its own credit risk.

(5)The fair value of the Amortizing Notes of the TEUs is based on the most recently quoted price for the outstanding securities, adjusted for any known significant deviation in value. The estimated fair value of these long-term obligations is not necessarily indicative of the amount that would be realized in a current market exchange.

Derivative Instruments Notional Amount Outstanding

The following table shows the notional amount of the Company’s derivative instruments outstanding as of June 30, 2020 and December 31, 2019:


(DOLLARS IN THOUSANDS)	June 30, 2020		December 31, 2019
Foreign currency contracts	$	417,674	$	473,600
Cross currency swaps	600,000		600,000

Derivative Instruments Measured at Fair Value

The following tables show the Company’s derivative instruments measured at fair value (Level 2 of the fair value hierarchy), as reflected in the Consolidated Balance Sheet as of June 30, 2020 and December 31, 2019:


	June 30, 2020
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets^(a)
Foreign currency contracts	$	1,081	$	3,856	$	4,937
Cross currency swaps	2,388		—		2,388

	$	3,469	$	3,856	$	7,325
Derivative liabilities^(b)
Foreign currency contract	$	1,962	$	2,020	$	3,982


	December 31, 2019
(DOLLARS IN THOUSANDS)	Fair Value of Derivatives Designated as Hedging Instruments		Fair Value of Derivatives Not Designated as Hedging Instruments		Total Fair Value
Derivative assets^(a)
Foreign currency contracts	$	1,310	$	2,265	$	3,575



Derivative liabilities^(b)
Foreign currency contracts	$	797	$	2,431	$	3,228
Interest rate swaps	4,187		—		4,187
Total derivative liabilities	$	4,984	$	2,431	$	7,415

_______________________

(a)Derivative assets are recorded to Prepaid expenses and other current assets in the Consolidated Balance Sheet.(b)Derivative liabilities are recorded as Other current liabilities in the Consolidated Balance Sheet

Derivative Instruments Which Were Not Designated as Hedging Instruments

The following table shows the effect of the Company’s derivative instruments which were not designated as hedging instruments in the Consolidated Statement of Income and Comprehensive Income (Loss) for the three and six months ended June 30, 2020 and 2019 (in thousands):


	Amount of Gain (Loss)							Location of Gain (Loss) Recognized in Income on Derivative
(DOLLARS IN THOUSANDS)	Three Months Ended June 30,
			2020			2019
Foreign currency contracts⁽¹⁾	$	4,308		$	(3,932)		Other income, net




	Amount of Gain (Loss)							Location of Gain (Loss) Recognized in Income on Derivative
(DOLLARS IN THOUSANDS)	Six Months Ended June 30,
			2020			2019
Foreign currency contracts⁽¹⁾	$	(3,354)		$	(3,006)		Other income, net

_______________________

(1)The foreign currency contract net gains (losses) offset any recognized gains (losses) arising from the revaluation of the related intercompany loans during the same respective periods.

Derivative Instruments Designated as Cash Flow and Net Investment Hedging Instruments

The following table shows the effect of the Company’s derivative and non-derivative instruments designated as cash flow and net investment hedging instruments, net of tax, in the Consolidated Statement of Income and Comprehensive Income (Loss) for the three and six months ended June 30, 2020 and 2019 (in thousands):


	Amount of Gain (Loss) Recognized in OCI on Derivative					Location of Gain (Loss) Reclassified from AOCI into Income			Amount of Gain (Loss) Reclassified from Accumulated OCI into Income
	Three Months Ended June 30,										Three Months Ended June 30,
(DOLLARS IN THOUSANDS)	2020		2019					2020			2019
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	(3,315)	$	(2,539)	Cost of goods sold	$	1,251		$	2,322
Interest rate swaps ⁽¹⁾	214		216		Interest expense	(214)			(216)
Derivatives in Net Investment Hedging Relationships:

Cross currency swaps	(19,508)		(3,904)		N/A	—			—
Non-Derivatives in Net Investment Hedging Relationships:
2024 Euro Notes	(11,074)		(4,823)		N/A	—			—
2021 Euro Notes & 2026 Euro Notes	(24,363)		(10,611)		N/A	—			—
Total	$	(58,046)	$	(21,661)		$	1,037		$	2,106

	Amount of (Loss) Gain Recognized in OCI on Derivative (Effective Portion)					Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)			Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)
	Six Months Ended June 30,										Six Months Ended June 30,
	2020		2019					2020			2019
Derivatives in Cash Flow Hedging Relationships:
Foreign currency contracts	$	(2,083)	$	(2,850)	Cost of goods sold	$	3,320		$	4,695
Interest rate swaps ⁽¹⁾	429		432		Interest expense	(429)			(432)
Derivatives in Net Investment Hedging Relationships:

Cross currency swaps	6,382		7,312		N/A	—			—
Non-Derivatives in Net Investment Hedging Relationships:
2024 Euro Notes	(1,505)		(617)		N/A	—			—
2021 Euro Notes & 2026 Euro Notes	(3,311)		(1,358)		N/A	—			—
Total	$	(88)	$	2,919		$	2,891		$	4,263

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(1)Interest rate swaps were entered into as pre-issuance hedges for bond offerings