DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

3 Months Ended

Mar. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives

The following table contains information on the outstanding interest rate swaps as of March 31, 2020:

Outstanding Interest Rate Swaps (a)
Date Entered Into	Term	Notional Amount	Related Debt Facility	Fixed Rate of Swap		Bank Margin on Debt		Total Effective Interest Rate (b)
August 2015	9 years	$170,000	Term Credit Agreement	2.20	%	1.63	%	3.83	%
August 2015	9 years	180,000	Term Credit Agreement	2.35	%	1.63	%	3.98	%
April 2016	10 years	100,000	Incremental Term Loan	1.60	%	1.90	%	3.50	%
April 2016	10 years	100,000	Incremental Term Loan	1.60	%	1.90	%	3.50	%
July 2016	10 years	100,000	Incremental Term Loan	1.26	%	1.90	%	3.16	%

(a)  All interest rate swaps have been designated as interest rate cash flow hedges and qualify for hedge accounting.

(b) Rate is before estimated patronage payments.

The following table contains information on the expired treasury lock agreements entered into during the period ending March 31, 2020:

Converted Treasury Rate Locks (a)
Date Entered Into	Term	Notional Amount	Rate	Related Debt Facility (b)	Expiration Date
January 2020	10 years	$100,000	1.53%	2020 Incremental Term Loan Facility	March 31, 2020
January 2020	10 years	100,000	1.53%	2020 Incremental Term Loan Facility	March 31, 2020
February 2020	10 years	50,000	1.35%	2020 Incremental Term Loan Facility	March 31, 2020

(a)  At inception, all treasury locks were designated as interest rate cash flow hedges and qualified for hedge accounting.

(b) On April 16, 2020, the Company entered into a Third Amendment and Incremental Term Loan Agreement which provided for a five-year $250 million senior unsecured incremental term loan facility (the “2020 Incremental Term Loan Facility”). See Note 6 — Debt for information regarding subsequent events. The Company anticipates extending the term of the 2020 Incremental Term Loan facility for an additional five-year term upon maturity.

The following table contains information on the outstanding interest rate swap lock agreements as of March 31, 2020:

Outstanding Interest Rate Swap Locks (a)
Date Entered Into	Term	Notional Amount	Fixed Rate of Swap Lock (b)	Related Debt Facility (c)	Effective Date
March 2020	10 years	$100,000	1.56%	2020 Incremental Term Loan Facility	July 31, 2020
March 2020	10 years	100,000	1.59%	2020 Incremental Term Loan Facility	June 30, 2020
March 2020	10 years	50,000	1.41%	2020 Incremental Term Loan Facility	June 30, 2020

(a)  All interest rate swap locks have been designated as interest rate cash flow hedges and qualify for hedge accounting.

(b) These interest rate swap locks were off-market derivatives, meaning they contained an embedded financing element, which the counterparties recovered through an incremental charge in the fixed rate over what would have been charged for an at-market swap lock.

(c) On April 16, 2020, the Company entered into a Third Amendment and Incremental Term Loan Agreement which provided for a five-year $250 million senior unsecured incremental term loan facility (the “2020 Incremental Term Loan Facility”). See Note 6 — Debt for information regarding subsequent events. The Company anticipates extending the term of the 2020 Incremental Term Loan facility for an additional five-year term upon maturity.

The following table contains information on the outstanding forward-starting interest rate swaps as of March 31, 2020:

Outstanding Forward-Starting Interest Rate Swaps (a)
Date Entered Into	Term	Notional Amount	Fixed Rate of Swap		Related Debt Facility	Forward Date	Maximum Period Ending for Forecasted Issuance Date
February 2020	10 years	$325,000	1.40	%	Anticipated refinancing of Senior Notes due 2022	April 2022	April 2022
March 2020	4 years	100,000	0.88	%	Anticipated extension of Term Credit Agreement	August 2024	April 2020 (b)

(a)  All forward-starting interest rate swaps have been designated as interest rate cash flow hedges and qualify for hedge accounting.

(b) On April 1, 2020, the maturity date of the Term Credit Agreement was extended from August 5, 2024 to April 1, 2028. See Note 6 — Debt for information regarding subsequent events. On April 8, 2020, the terms of this forward-starting swap were modified to match the maturity date of the Term Credit Agreement.

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance

The following tables demonstrate the impact, gross of tax, of the Company’s derivatives on the Consolidated Statements of Income and Comprehensive Income for three months ended March 31, 2020 and 2019:

		Three Months Ended March 31,
	Income Statement Location	2020	2019
Derivatives designated as cash flow hedges:
Foreign currency exchange contracts	Other comprehensive (loss)	($5,480)	$1,119
Foreign currency option contracts	Other comprehensive (loss)	(1,149)	77
Interest rate swaps	Other comprehensive (loss)	(38,998)	(11,548)
Treasury locks	Other comprehensive (loss)	(20,846)	—
Interest rate swap locks	Other comprehensive (loss)	854	—
Forward-starting interest rate swaps	Other comprehensive (loss)	(19,710)	—
Derivatives not designated as hedging instruments:
Foreign currency exchange contracts	Interest and other miscellaneous (expense) income, net	—	(16)
Carbon option contracts	Interest and other miscellaneous (expense) income, net	549	402

Schedule of Notional Amounts of Outstanding Derivative Positions

The following table contains the notional amounts of the derivative financial instruments recorded in the Consolidated Balance Sheets:

	Notional Amount
	March 31, 2020	December 31, 2019
Derivatives designated as cash flow hedges:
Foreign currency exchange contracts	$60,350	$56,350
Foreign currency option contracts	36,000	22,000
Interest rate swaps	650,000	650,000
Interest rate swap locks	250,000	—
Forward-starting interest rate swaps	425,000	—
Derivative not designated as a hedging instrument:
Foreign currency exchange contracts	—	—
Carbon options (a)	5,070	9,592

(a) Notional amount for carbon options is calculated as the number of units outstanding multiplied by the spot price as of March 31, 2020.

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table contains the fair values of the derivative financial instruments recorded in the Consolidated Balance Sheets:

	Location on Balance Sheet	Fair Value Assets / (Liabilities) (a)
		March 31, 2020	December 31, 2019
Derivatives designated as cash flow hedges:
Foreign currency exchange contracts	Other current assets	$79	$424
	Other assets	—	390
	Other current liabilities	(4,319)	(172)
	Other non-current liabilities	(599)	—
Foreign currency option contracts	Other current assets	68	151
	Other assets	129	209
	Other current liabilities	(546)	(27)
	Other non-current liabilities	(497)	(30)
Interest rate swaps	Other assets	—	2,614
	Other non-current liabilities	(47,452)	(11,068)
Interest rate swap locks	Other non-current liabilities	(19,992)	—
Forward-starting interest rate swaps	Other non-current liabilities	(19,710)	—
Derivative not designated as a hedging instrument:
Carbon options	Other current liabilities	(14)	(607)
Total derivative contracts:
Other current assets		$147	$575
Other assets		129	3,213
Total derivative assets		$276	$3,788
Other current liabilities		(4,879)	(806)
Other non-current liabilities		(88,250)	(11,098)
Total derivative liabilities		($93,129)	($11,904)

(a) See Note 14 — Fair Value Measurements for further information on the fair value of the Company’s derivatives including their classification within the fair value hierarchy.