Derivative Instruments And Hedging Strategies

3 Months Ended

Mar. 31, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments And Hedging Strategies

DERIVATIVE INSTRUMENTS AND HEDGING STRATEGIES

Exchange Option Liability on Subsidiary Convertible Senior Notes. The exchange option liability is carried at fair value and relates to a bifurcated embedded derivative in the Company's 3.75% Subsidiary Convertible Senior Notes. The activity of the exchange option liability for the three months ended March 31, 2016 was as follows:

Balance as of December 31, 2015	$	5,611
Unrealized losses included in derivative gains (losses), net	136
Balance as of March 31, 2016	$	5,747

Cash Flow Hedges. Certain of the Company's 50% or less owned companies have interest rate swap agreements designated as cash flow hedges. By entering into these interest rate swap agreements, the Company's 50% or less owned companies have converted the variable LIBOR component of certain of their outstanding borrowings to a fixed interest rate. The Company recognized losses on derivative instruments designated as cash flow hedges of $1.8 million and $0.4 million for the three months ended March 31, 2016 and 2015, respectively, as a component of other comprehensive income (loss). As of March 31, 2016, the interest rate swaps held by the Company's 50% or less owned companies were as follows:

• MexMar had four interest rate swap agreements with maturities in 2023 that call for MexMar to pay a fixed rate of interest ranging from 1.71% to 2.05% on the aggregate amortized notional value of $114.7 million and receive a variable interest rate based on LIBOR on the aggregate amortized notional value.

• Sea-Cat Crewzer II had an interest rate swap agreement maturing in 2019 that calls for Sea-Cat Crewzer II to pay a fixed rate of interest of 1.52% on the amortized notional value of $25.0 million and receive a variable interest rate based on LIBOR on the amortized notional value.

• Sea-Cat Crewzer had an interest rate swap agreement maturing in 2019 that calls for Sea-Cat Crewzer to pay a fixed rate of interest of 1.52% on the amortized notional value of $22.2 million and receive a variable interest rate based on LIBOR on the amortized notional value.

• SeaJon had an interest rate swap agreement maturing in 2017 that calls for SeaJon to pay a fixed interest rate of 2.79% on the amortized notional value of $32.1 million and receive a variable interest rate based on LIBOR on the amortized notional value.

Other Derivative Instruments. Other derivative instruments not designated as hedging instruments are classified as either assets or liabilities based on their individual fair values. Derivative assets and liabilities are included in other receivables and other current liabilities, respectively, in the accompanying condensed consolidated balance sheets. The fair values of the Company’s derivative instruments as of March 31, 2016 were as follows (in thousands):

	Derivative Asset		Derivative Liability
Options on equities and equity indices	$	—	$	250
Forward currency exchange, option and future contracts	228		—
Interest rate swap agreements	—		212
Commodity swap, option and future contracts:
Exchange traded	199		1,413
	$	427	$	1,875

The Company recognized gains (losses) on derivative instruments not designated as hedging instruments for the three month ended March 31 as follows (in thousands):

	2016			2015
Options on equities and equity indices	$	2,904		$	(1,374	)
Forward currency exchange, option and future contracts	45			(304		)
Interest rate swap agreements	(6		)	(9		)
Commodity swap, option and future contracts:
Exchange traded	(187		)	(2,184		)
Non-exchange traded	—			875
	$	2,756		$	(2,996	)

The Company holds positions in publicly traded equity options that convey the right or obligation to engage in future transactions in the underlying equity security or index. The Company’s investment in equity options primarily includes positions in energy, marine, transportation and other related businesses. These contracts are typically entered into to mitigate the risk of changes in the market value of marketable security positions that the Company is either about to acquire, has acquired or is about to dispose.

The Company enters and settles forward currency exchange, option and future contracts with respect to various foreign currencies. As of March 31, 2016, the outstanding forward currency exchange contracts translated into a net purchase of foreign currencies with an aggregate U.S. dollar equivalent of $2.0 million. These contracts enable the Company to buy currencies in the future at fixed exchange rates, which could offset possible consequences of changes in currency exchange rates with respect to the Company’s business conducted outside of the United States. The Company generally does not enter into contracts with forward settlement dates beyond twelve to eighteen months.

The Company and certain of its 50% or less owned companies have entered into interest rate swap agreements for the general purpose of providing protection against increases in interest rates, which might lead to higher interest costs. As of March 31, 2016, the interest rate swaps held by the Company or its 50% or less owned companies were as follows:

• The Company had an interest rate swap agreement maturing in 2018 that calls for the Company to pay a fixed interest rate of 3.00% on the amortized notional value of $5.8 million and receive a variable interest rate based on Euribor on the amortized notional value.

• OSV Partners had two interest rate swap agreements with maturities in 2020 that call for OSV Partners to pay a fixed rate of interest ranging from 1.89% to 2.27% on the aggregate amortized notional value of $41.8 million and receive a variable interest rate based on LIBOR on the aggregate amortized notional value.

• Dynamic Offshore had an interest rate swap agreement maturing in 2018 that calls for Dynamic Offshore to pay a fixed interest rate of 1.30% on the amortized notional value of $81.2 million and receive a variable interest rate based on LIBOR on the amortized notional value.

• Falcon Global had an interest rate swap agreement maturing in 2022 that calls for Falcon Global to pay a fixed interest rate of 2.06% on the amortized notional value of $62.5 million and receive a variable interest rate based on LIBOR on the amortized notional value.

The Company and certain of its 50% or less owned companies enters and settles positions in various exchange and non-exchange traded commodity swap, option and future contracts. ICP enters into exchange traded positions (primarily corn, ethanol and natural gas) to protect its raw material and finished goods inventory balances from market changes. VA&E enters into exchange traded positions to protect its fixed price future purchase and sale contracts for sugar as well as its inventory balances from market changes. As of March 31, 2016, the net market exposure to these commodities under these contracts was not material.

Fair Values Of Derivative Instruments

The fair values of the Company’s derivative instruments as of March 31, 2016 were as follows (in thousands):

	Derivative Asset		Derivative Liability
Options on equities and equity indices	$	—	$	250
Forward currency exchange, option and future contracts	228		—
Interest rate swap agreements	—		212
Commodity swap, option and future contracts:
Exchange traded	199		1,413
	$	427	$	1,875