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Derivative Instruments and Hedging Activities
 12 Months Ended
Jun. 30, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
As part of our financial risk management program, we use certain derivative financial instruments. See Note 2 for discussion on our derivative instruments and hedging activities policy.
The fair value of derivatives designated and not designated as hedging instruments in the consolidated balance sheet are as follows:
(in thousands)
2020
 
2019
Derivatives designated as hedging instruments
 
 
 
Other current assets - range forward contracts
$
4

 
$
145

Other assets - forward starting interest rate swap contracts
20

 
—

Other liabilities - forward starting interest rate swap contracts
(2,094
)
 
—

Total derivatives designated as hedging instruments
(2,070
)
 
145

Derivatives not designated as hedging instruments
 
 
 
Other current assets - currency forward contracts
12

 
8

Other current liabilities - currency forward contracts
(45
)
 
(56
)
Total derivatives not designated as hedging instruments
(33
)
 
(48
)
Total derivatives
$
(2,103
)
 
$
97


Certain currency forward contracts that hedge significant cross-border intercompany loans are considered as other derivatives and therefore do not qualify for hedge accounting. These contracts are recorded at fair value in the consolidated balance sheet, with the offset to other income, net. Losses (gains) related to derivatives not designated as hedging instruments have been recognized as follows:
(in thousands)
2020
 
2019
 
2018
Other income, net - currency forward contracts
$
210

 
$
108

 
$
(122
)

CASH FLOW HEDGES
Currency forward contracts and range forward contracts (a transaction where both a put option is purchased and a call option is sold) are designated as cash flow hedges and hedge anticipated cash flows from cross-border intercompany sales of products and services. Gains and losses realized on these contracts are recorded in accumulated other comprehensive loss, and are recognized as a component of other income, net when the underlying sale of products or services is recognized into earnings. The notional amount of the contracts translated into U.S. dollars at June 30, 2020 and 2019 was $2.2 million and $61.5 million, respectively. The time value component of the fair value of range forward contracts is excluded from the assessment of hedge effectiveness. Assuming the market rates remain constant with the rates at June 30, 2020, we expect to recognize into earnings in the next 12 months an immaterial amount of expense on outstanding derivatives.
During fiscal 2020, we entered into forward starting interest rate swap contracts to hedge a portion of the interest rate risk related to our anticipated refinancing of the Senior Unsecured Notes due fiscal 2022. We recorded the fair value of these contracts as an asset or a liability, as applicable, in the balance sheet, with the offset to accumulated other comprehensive income, net of tax. The notional amount of the contracts at June 30, 2020 was $200.0 million. As of June 30, 2020, we recorded a net liability of $2.1 million on these contracts, the net effect of which was recorded as a decrease to accumulated other comprehensive loss, net of tax.
The following represents gains and losses related to cash flow hedges:
(in thousands)
2020
 
2019
 
2018
(Losses) gains recognized in other comprehensive (loss) income, net
$
(577
)
 
$
921

 
$
(922
)
Losses reclassified from accumulated other comprehensive loss into other income, net
$
1,425

 
$
1,004

 
$
3,001


No portion of the gains or losses recognized in earnings was due to ineffectiveness and no amounts were excluded from our effectiveness testing for the years ended June 30, 2020, 2019 and 2018.
NET INVESTMENT HEDGES
As of June 30, 2020 and 2019, we had foreign currency-denominated intercompany loans payable with total aggregate principal amounts of €15.9 million and €22.5 million, respectively, designated as net investment hedges to hedge the foreign exchange exposure of our net investment in Euro-based subsidiaries. The notional value of the contract, which has a maturity of June 26, 2022, was €15.9 million, or $17.8 million, as of June 30, 2020. Gains of $0.6 million and $2.4 million and a loss of $0.7 million were recorded as a component of foreign currency translation adjustments in other comprehensive (loss) income during 2020, 2019 and 2018, respectively.