Derivative Instruments and Hedging Activities (Notes)

9 Months Ended

Sep. 30, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company is exposed to certain risks arising from both its business operations and economic conditions. The primary risks that the Company manages through its derivative instruments from time to time are foreign currency exchange rate risk and commodity pricing risk. We enter into derivative financial instruments with various financial institutions to minimize counterparty credit risk. Depending on the type of transaction, we may enter into either derivatives that are designated as hedging instruments and/or derivatives that are not designated as hedging instruments.

As of September 30, 2016, we do not currently hold any derivatives classified as hedging instruments and qualifying for hedge accounting.

Derivatives not designated as hedging instruments

To minimize foreign currency exposure, the Company had foreign currency forwards with notional amounts of $1,000,000 at September 30, 2016. These derivative instruments mature in March 2017. No foreign currency or commodity options were outstanding at September 30, 2016.

Commodity options, foreign exchange forwards and forward exchange options are recorded in the consolidated balance sheet at fair value and the resulting gains or losses are recorded to other income in the consolidated statement of operations. The (gains) losses recognized for the three and nine months ended September 30, are as follows (in thousands):

	Three Months Ended   September 30,					Nine Months Ended   September 30,
Derivatives not designated as hedging instruments	2016		2015			2016			2015
Commodity options	$	—	$	37		$	—		$	392
Foreign exchange forwards	—		114			(14		)	208
Foreign exchange options	—		(2,643		)	—			(5,460		)
Total non-designated derivative realized (gain) loss, net	$	—	$	(2,492	)	$	(14	)	$	(4,860	)

Summary of Derivatives

Derivatives consist of the following (in thousands):

		September 30, 2016		December 31, 2015
Derivatives not designated as hedging instruments	Classification	Fair Value		Fair Value
Foreign exchange options	Other current assets	$	—	$	1,792
Foreign exchange forwards	Other current assets	$	1	$	—
Foreign exchange forwards	Accrued expenses	$	—	$	14