Derivative Financial Instruments (Tables)

9 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosures

Offsetting Assets and Liabilities

The following table represents our gross and net derivative assets and liabilities:

(In thousands)	Gross Amount Presented on the Consolidated Balance Sheets			Netting Adjustments (a)			Net Amount
June 30, 2014
Derivative assets	$	12		$	(12	)	$	—
Derivative liabilities	(1,428		)	12			(1,416		)
September 30, 2013
Derivative assets	$	—		$	—		$	—
Derivative liabilities	(1,586		)	—			(1,586		)

(a) We have agreements in place with some of our financial trading counterparties that allow for the financial right of offset for derivative assets and derivative liabilities under the agreements.

Designated as Hedging Instrument | Cash Flow Hedging

Derivative Instruments and Hedging Activities Disclosures

Fair Value of Cash Flow Hedge Derivative Contracts Included in the Consolidated Balance Sheets

The following table presents the fair value of our derivative contracts designated as cash flow hedging instruments included in our Condensed Consolidated Balance Sheets as of June 30, 2014 and September 30, 2013:

	Asset Derivatives					Liability Derivatives
(In thousands)		June 30, 2014		September 30, 2013			June 30, 2014		September 30, 2013
Derivative contracts designated as cash flow hedging instruments	Balance Sheet Location	Fair Value		Fair Value		Balance Sheet Location	Fair Value		Fair Value
Short-term interest rate swaps	Prepaid expenses and deferred costs	$	—	$	—	Accrued liabilities	$	1,126	$	1,586
Long-term interest rate swaps	Deferred costs and other assets	12		—		Other long-term liabilities	—		—
Short-term foreign currency forward exchange contracts	Prepaid expenses and deferred costs	—		—		Accrued liabilities	173		—
Long-term foreign currency forward exchange contracts	Deferred costs and other assets	—		—		Other long-term liabilities	129		—
Total derivatives designated as cash flow hedging instruments		$	12	$	—		$	1,428	$	1,586

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

The following table presents the gains and losses on our derivative contracts designated as cash flow hedging instruments on our Condensed Consolidated Statements of Operations and Condensed Statements of Comprehensive Income for the three months ended June 30, 2014 and 2013:

Derivative contracts designated as cash flow hedging instruments	Amount of Gain or (Loss) Recognized in AOCI on Derivative (Effective Portion)					Location of Gain or (Loss) Reclassified from AOCI in Income	Amount of Gain or (Loss) Reclassified from AOCI into Income (Effective Portion)
(In thousands)	Three Months Ended June 30,						Three Months Ended June 30,
	2014			2013			2014			2013
Interest rate swaps	$	(490	)	$	51	Interest expense, net of capitalized interest	$	(488	)	$	(441	)
Foreign currency forward exchange contracts	586			—		Contract drilling revenues & costs	125			—
Total	$	96		$	51		$	(363	)	$	(441	)

The following table presents the gains and losses on our derivative contracts designated as cash flow hedging instruments on our Condensed Consolidated Statements of Operations and Condensed Statements of Comprehensive Income for the nine months ended June 30, 2014 and 2013:

Derivative contracts designated as cash flow hedging instruments	Amount of Gain or (Loss) Recognized in AOCI on Derivative (Effective Portion)					Location of Gain or (Loss) Reclassified from AOCI in Income	Amount of Gain or (Loss) Reclassified from AOCI into Income (Effective Portion)
(In thousands)	Nine Months Ended June 30,						Nine Months Ended June 30,
	2014			2013			2014			2013
Interest rate swaps	$	(926	)	$	3	Interest expense, net of capitalized interest	$	(1,293	)	$	(1,316	)
Foreign currency forward exchange contracts	(302		)	—		Contract drilling revenues & costs	9			—
Total	$	(1,228	)	$	3		$	(1,284	)	$	(1,316	)