Derivatives and Hedging

6 Months Ended

Jan. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

The fair value of our derivative instruments and the associated notional amounts, presented on a pre-tax basis, were as follows:


	January 31, 2021				July 31, 2020
			Fair Value in					Fair Value in
			Other Current					Other Current
Cash Flow Hedges	Notional		Liabilities			Notional		Liabilities
Foreign currency forward contracts	$	13,731	$	92		$	—	$	—
Interest rate swap agreements	581,913		17,387			673,400		24,840
Total derivative financial instruments	$	595,644	$	17,479		$	673,400	$	24,840

Foreign currency forward contracts accounted for as cash flow hedges and outstanding at January 31, 2021 mature over the next two months.

Net Investment Hedges

The foreign currency transaction gains and losses on the Euro-denominated portion of the term loan, which is designated and effective as a hedge of the Company’s net investment in its Euro-denominated functional currency subsidiaries, are included as a component of the foreign currency translation adjustment. Losses for the three and six months ended January 31, 2021, net of tax, were $16,436 and $10,954, respectively, and gains for the three and six months ended January 31, 2020, net of tax, were $3,802 and $2,843, respectively.

There were no amounts reclassified out of accumulated other comprehensive income ("AOCI") pertaining to the net investment hedge during the three and six-month periods ended January 31, 2021 and January 31, 2020, respectively.

Derivatives Not Designated as Hedging Instruments

The Company has certain other derivative instruments which have not been designated as hedges. These other derivative instruments had a notional amount totaling approximately $34,431 and a fair value of $1,932, which is included in Other current liabilities in the Condensed Consolidated Balance Sheet as of January 31, 2021. These other derivative instruments had a notional amount totaling approximately $34,862 and a fair value of $1,824, as of July 31, 2020. For these derivative instruments, changes in fair value are recognized in earnings.

The total amounts presented in the Condensed Consolidated Statements of Income and Comprehensive Income due to changes in the fair value of the following derivative instruments are as follows:


	Three Months Ended January 31,
	2021		2020
Gain (Loss) on Derivatives Designated as Cash Flow Hedges

Gain (Loss) recognized in Other Comprehensive Income, net of tax
Foreign currency forward contracts	$	(66)	$	(490)
Interest rate swap agreements	2,417		266
Total gain (loss)	$	2,351	$	(224)


	Six Months Ended January 31,
	2021		2020
Gain (Loss) on Derivatives Designated as Cash Flow Hedges

Gain (Loss) recognized in Other Comprehensive Income, net of tax
Foreign currency forward contracts	$	(66)	$	(1,015)
Interest rate swap agreements	5,749		(2,931)
Total gain (loss)	$	5,683	$	(3,946)


	Three Months Ended January 31,
	2021				2020
			Interest					Interest
	Sales		Expense			Sales		Expense
Gain (Loss) Reclassified from AOCI, Net of Tax
Foreign currency forward contracts	$	7	$	—		$	(434)	$	—
Interest rate swap agreements	—		(2,623)			—		(1,019)
(Loss) on Derivatives Not Designated as Hedging Instruments
Amount of loss recognized in income, net of tax

Interest rate swap agreements	—		(8)			—		(93)
Total gain (loss)	$	7	$	(2,631)		$	(434)	$	(1,112)


	Six Months Ended January 31,
	2021				2020
			Interest					Interest
	Sales		Expense			Sales		Expense
Gain (Loss) Reclassified from AOCI, Net of Tax
Foreign currency forward contracts	$	7	$	—		$	(434)	$	—
Interest rate swap agreements	—		(5,397)			—		(1,514)
(Loss) on Derivatives Not Designated as Hedging Instruments
Amount of loss recognized in income, net of tax

Interest rate swap agreements	—		(46)			—		(168)
Total gain (loss)	$	7	$	(5,443)		$	(434)	$	(1,682)