XML 12 R17.htm IDEA: XBRL DOCUMENT v2.4.0.8
DERIVATIVE FINANCIAL INSTRUMENTS
 3 Months Ended
Sep. 28, 2013
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE FINANCIAL INSTRUMENTS
Derivative Financial Instruments
As of September 28, 2013, the Company had outstanding foreign currency forward contracts with a total notional amount of $68.5 million. These contract maturity dates extend through December 2016. For the three months ended September 28, 2013, the Company entered into foreign currency forward contracts of $5.0 million and settled $6.2 million of such contracts. The Company did not enter into any foreign currency forward contracts during the three months ended September 29, 2012. However, the Company settled $5.5 million of foreign currency forward contracts during the three months ended September 29, 2012.
Subsequent to September 28, 2013, the Company entered into $5.2 million of forward contracts that extended our hedge position through March 2017.
The following table summarizes the fair value of derivative instruments in the Consolidated Balance Sheets as of September 28, 2013 and June 29, 2013 (in thousands):
 
 
 
 
September 28, 2013
 
June 29, 2013
Derivatives Designated as Hedging Instruments
Balance Sheet Location
 
Fair Value
 
Fair Value
Foreign currency forward contracts
Other current assets
 
$
948

 
$
760

Foreign currency forward contracts
Other long-term assets
 
$
1,143

 
$
1,669

Foreign currency forward contracts
Other current liabilities
 
$
(115
)
 
$
(145
)
Foreign currency forward contracts
Other long-term liabilities
 
$
(366
)
 
$
(289
)

The following tables summarize the gain (loss) on derivative instruments, net of tax, on the Consolidated Statements of Income for the three months ended September 28, 2013 and September 29, 2012, respectively (in thousands):
 
Derivatives Designated as Hedging Instruments
AOCI Balance
as of
June 29, 2013
 
Effective
Portion
Recorded In
AOCI
 
Effective Portion
Reclassified From
AOCI Into
Cost of  Sales
 
AOCI Balance
as of
September 28,
2013
Settled foreign currency forward contracts for the three months ended September 28, 2013
$
15

 
$
60

 
$
(75
)
 
$
—

Unsettled foreign currency forward contracts
1,298

 
(239
)
 


 
1,059

Total
$
1,313

 
$
(179
)
 
$
(75
)
 
$
1,059

 
 
 
 
 
 
 
 
Derivatives Designated as Hedging Instruments
AOCI Balance
as of
June 30,
2012
 
Effective
Portion
Recorded In
AOCI
 
Effective Portion
Reclassified From
AOCI Into
Cost of  Sales
 
AOCI Balance
as of September 29,
2012
Settled foreign currency forward contracts for the three months ended September 29, 2012
$
118

 
$
153

 
$
(271
)
 
$
—

Unsettled foreign currency forward contracts
(777
)
 
1,350

 
—

 
573

Total
$
(659
)
 
$
1,503

 
$
(271
)
 
$
573


 
 
 
 
 
 
 
 
The Company does not enter into derivative instruments for trading or speculative purposes. The Company’s counterparties to the foreign currency forward contracts are major financial institutions. These institutions do not require collateral for the contracts and the Company believes that the risk of the counterparties failing to meet their contractual obligations is remote. As of September 28, 2013, the net amount of unrealized gain expected to be reclassified into earnings within the next 12 months is approximately $0.6 million. As of September 28, 2013, the Company does not have any foreign exchange contracts with credit-risk-related contingent features.