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Derivative Financial Instruments
 6 Months Ended
Jun. 28, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Derivative Financial Instruments
Foreign currency derivatives not designated as hedges – As a multinational corporation, we are exposed to the impact of foreign currency fluctuations. To the extent borrowings, sales, purchases, or other transactions are not executed in the local currency of the operating unit, we are exposed to foreign currency risk. In most of the countries in which we operate, the exposure to foreign currency movements is limited because the operating revenues and expenses of our business units are substantially denominated in the local currency. To mitigate the exposure, we may enter into a variety of foreign currency derivative contracts. To manage the effect of exchange fluctuations on certain intercompany transactions and intercompany loans and interest that are denominated in foreign currencies, we have foreign currency derivative contracts with a total notional amount of $151.0 million as of June 28, 2025. We do not use derivative financial instruments for trading or speculative purposes. We record mark-to-market changes in the values of these derivatives as unrealized gain/(loss) in other income, net. We recorded mark-to-market gains of $1.8 million and $1.1 million relating to foreign currency derivatives during the three and six months ended June 28, 2025, respectively. Additionally, we recorded settlements of derivative contracts in realized losses on derivatives of $1.0 million and $1.1 million in other income, net in the three and six months ended June 28, 2025, respectively. We recorded mark-to-market losses of $0.2 million and gains of $1.5 million relating to foreign currency derivatives in the three and six months ended June 29, 2024, respectively. Additionally, we recorded settlements of derivative contracts in realized losses on derivatives of $0.4 million in other income, net in the three and six months ended June 29, 2024.
Foreign currency derivatives designated as cash flow hedges – At the end of 2024 we implemented a hedging program to manage the potential changes in value associated with the amounts payable on raw material purchases that are denominated in foreign currencies to minimize the impact of the changes in foreign currencies. We have foreign currency derivative contracts, which qualify as cash flow hedges, with a total notional amount of $99.8 million. We record gains and losses for these contracts in AOCL to the extent that these hedges are effective and until we recognize the underlying transactions in net earnings, at which time we recognize these gains and losses in cost of sales on our consolidated statements of operations.
No portion of these derivative contracts were deemed ineffective during the three and six months ended June 28, 2025. In other comprehensive income (loss), we recorded pre-tax mark-to-market gains of $0.7 million and losses of $0.9 million during the three and six months ended June 28, 2025, respectively. We did not record any pre-tax mark-to-market losses or gains during the three and six months ended June 29, 2024. We reclassified losses of $0.2 million previously recorded in other comprehensive income (loss) to cost of sales during the three and six months ended June 28, 2025.
As of June 28, 2025, approximately $0.5 million in losses is expected to be reclassified to earnings over the next 12 months.
Commodity derivatives not designated as hedges – As part of our operations, we are exposed to the price changes of certain commodities used in the production of some of our finished products. To limit the effects of fluctuations in the future market price paid, the Company has entered into non-designated derivative contracts to manage the cost of anticipated purchases. We have commodity forward swap contracts with a total notional amount of $2.5 million as of June 28, 2025. We do not use derivative financial instruments for trading or speculative purposes. We record mark-to-market changes in the values of these derivatives as unrealized gain/(loss) in other income, net. We recorded pre-tax mark-to-market gains of $0.2 million and $0.6 million relating to commodity derivatives during the three and six months ended June 28, 2025, respectively. Additionally, we recorded settlements of derivative contracts in realized gains on derivatives of $0.1 million in other income, net in the three and six months ended June 28, 2025. We did not record any pre-tax mark-to-market losses or gains during the three and six months ended June 29, 2024.
Commodity derivatives designated as cash flow hedges – As part of our operations, we are exposed to the price changes of certain commodities used in the production of some of our finished products. To limit the effects of fluctuations in the future market price paid and related volatility in cash flows, the Company enters into commodity forward swap contracts. These contracts are designated as cash flow hedges; therefore, the related gains or losses are reported in AOCL and reclassified into earnings, to cost of sales, in the periods in which the hedged transactions affect earnings. We have commodity derivative contracts, which qualify as cash flow hedges, with a total notional amount of $3.8 million.
No portion of these derivative contracts were deemed ineffective during the three and six months ended June 28, 2025. In other comprehensive income (loss), we recorded pre-tax mark-to-market losses of $0.1 million and gains of $0.1 million during the three and six months ended June 28, 2025, respectively. We did not record any pre-tax mark-to-market losses or gains during the three and six months ended June 29, 2024. We reclassified nominal gains and gains of $0.4 million during the three and six months ended June 28, 2025, previously recorded in other comprehensive income (loss) to cost of sales.
As of June 28, 2025, approximately $0.1 million in gains is expected to be reclassified to earnings over the next 12 months.
Interest rate derivatives – We are exposed to interest rate risk in connection with our variable rate long-term debt. In February 2024, we entered into interest rate collar agreements with a cap rate of 4.50% paid against one-month USD-SOFR CME Term floored at 3.982% and 3.895% with outstanding notional amounts aggregating to $100.0 million corresponding to that amount of the debt outstanding under our Term Loan Facility. The interest rate collar agreements were designated as cash flow hedges of a portion of the interest obligations on our Term Loan Facility borrowings and are set to mature in February 2026.
No portion of these interest rate contracts were deemed ineffective during the three and six months ended June 28, 2025. In other comprehensive income (loss), we recorded pre-tax mark-to-market losses of $0.1 million and gains of $0.1 million during the three and six months ended June 28, 2025, respectively. We recorded pre-tax mark-to-market gains of $0.3 million and $0.7 million during the three and six months ended June 29, 2024, respectively. There were no gains or losses previously recorded in other comprehensive income (loss) that were reclassified to interest income during the three and six months ended June 28, 2025. We reclassified gains of $0.2 million and $0.3 million previously recorded in other comprehensive income (loss) to interest income during the three and six months ended June 29, 2024, respectively.
As of June 28, 2025, approximately $0.1 million in gains is expected to be reclassified to earnings over the next 12 months.
The fair values of derivative instruments held are as follows:
Derivative Assets
(amounts in thousands)Balance Sheet LocationJune 28, 2025December 31, 2024
Derivatives designated as hedging instruments:
Foreign currency forward contractsOther current assets$4,101 $469 
Commodity contractsOther current assets133 — 
Derivatives not designated as hedging instruments:
Foreign currency forward contractsOther current assets$22 $1,302 
Commodity contractsOther current assets488 — 
Derivative Liabilities
(amounts in thousands)Balance Sheet LocationJune 28, 2025December 31, 2024
Derivatives designated as hedging instruments:
Foreign currency forward contractsAccrued expenses and other current liabilities$4,645 $135 
Interest rate contractsAccrued expenses and other current liabilities104 101 
Interest rate contractsDeferred credits and other liabilities— 36 
Commodity contractsAccrued expenses and other current liabilities— 185 
Derivatives not designated as hedging instruments:
Foreign currency forward contractsAccrued expenses and other current liabilities$220 $2,411 
Commodity contractsAccrued expenses and other current liabilities— 73