v3.26.1
Derivative Instruments
 6 Months Ended
Jun. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments Derivative Instruments
The Company enters into derivative instrument agreements, including cross-currency and interest rate swaps, foreign currency forwards, and zero-cost collars, to manage risk in connection with changes in foreign currency and interest rates. The Company hedges committed exposures and does not engage in speculative transactions. The Company only enters into derivative instrument agreements with counterparties who have highly rated credit.
As of June 30, 2026, the aggregate notional amounts of the Company's outstanding interest rate contracts, cross currency swap contracts, EUR forward contract, and net investment hedge were $292.5 million, $371.5 million, $321.7 million, and $557.2 million, respectively.

During June 2026, the Company determined that certain forecasted cash flows that had been designated as hedged transactions in cash flow hedging relationships were no longer probable of occurring. As a result, the Company simultaneously terminated and discontinued hedge accounting for the affected portion of the interest rate swap in cash flow hedging relationships and reclassified approximately $0.7 million of gains from OCI into Interest income, net and other finance costs in the Consolidated Statements of Operations during the period.

During June 2026, and in connection with a reassessment of its foreign currency risk management strategy, the Company entered into an offsetting forward contract to effectively fix the value of its pre-existing forward contract through its maturity. Concurrently, the Company de-designated the original forward contract as a net investment hedge. The accumulated other comprehensive income (loss) related to the de-designated hedge will remain in OCI until the underlying hedged net investment is sold, substantially liquidated, or otherwise disposed of. Subsequent changes in the fair value of both the original and offsetting contracts will be recognized directly in earnings. Additionally, the Company entered into a zero-cost EUR/USD collar in June 2026 that was designated as net investment hedge of a $300 million portion of its net investment in its EUR subsidiary.

For derivative instruments that are designated and qualify as a net investment hedge, the gain or loss on the derivative instrument attributable to changes in the spot rate is reported in the CTA section of OCI and will remain in OCI until the hedged net investment would be sold or liquidated. The Company has elected to assess hedge effectiveness based on changes in spot exchange rates. Under this method, the Company recognizes in earnings the initial value of the component excluded from the assessment of effectiveness using a systematic and rational method over the life of the hedging instrument. The interest accruals are also recognized in earnings. Any difference between the change in fair value of the excluded component and amounts recognized in earnings under that systematic and rational method will be recognized in the CTA section of OCI.

In May 2025, the Company entered into a cross-currency swap expiring in May 2032 to hedge its exposure to adverse foreign currency exchange rate movements for its operations in Europe, which qualifies as net investment hedge. For the derivative instrument, the gain or loss on the derivative instrument attributable to changes in the spot rate is reported in the CTA section of OCI and will remain in OCI until the hedged net investment is sold or liquidated. The Company has elected to assess hedge effectiveness based on changes in spot exchange rates. Under this method, the Company recognizes in earnings the initial value of the component excluded from the assessment of effectiveness over the life of the hedging instrument. The interest accruals are also recognized in earnings (interest expense). Any difference between the change in fair value of the excluded component and amounts recognized in earnings will be recognized in the CTA section of OCI.

The effects of cash flow hedge accounting on the Condensed Consolidated Statements of Earnings and Comprehensive Income for the six months ended June 30, were as follows:
20262025
(in thousands)Cost of salesInterest income, net and other finance costsOther & foreign exchange loss, netCost of salesInterest income, net and other finance costsOther & foreign exchange loss, net
Total amounts of income and expense line items presented in the Condensed Consolidated Statement of Earnings in which the effects of fair value or cash flow hedges are recorded$674,956 $8,629 $(5,187)$626,493 $1,998 $(626)
The effects of cash flow hedging
Gain or (loss) on cash flow hedging relationships
Interest contracts:
Amount of gain (loss) reclassified from OCI to earnings— 3,080 — — 3,917 — 
Cross currency swap contract
Amount of gain (loss) reclassified from OCI to earnings— 1,124 13,203 — 1,539 (49,880)

The effects of derivative instruments on the Condensed Consolidated Statements of Earnings and Comprehensive Income for the three months ended June 30, 2026 and 2025 were as follows:
Cash Flow Hedging RelationshipsGain (Loss) Recognized in OCILocation of Gain (Loss) Reclassified from OCI into EarningsGain (Loss) Reclassified from OCI into Earnings
(in thousands)2026202520262025
Interest rate contracts$535 $(337)Interest expense$1,818 $1,952 
Cross currency contracts4,536 (35,427)Interest expense573 411 
FX gain (loss)1,889 (33,982)
Total$5,071 $(35,764)$4,280 $(31,619)
The effects of derivative instruments on the Condensed Consolidated Statements of Earnings and Comprehensive Income for the six months ended June 30, 2026 and 2025 were as follows:

Cash Flow Hedging RelationshipsGain (Loss) Recognized in OCILocation of Loss Reclassified from OCI into EarningsGain (Loss) Reclassified from OCI into Earnings
(in thousands)2026202520262025
Interest rate contracts$1,998 $(2,124)Interest expense$3,080 $3,917 
Cross currency contracts13,676 (49,217)Interest expense1,124 1,539 
FX loss13,203 (49,880)
Total $15,674 $(51,341)$17,407 $(44,424)
For the three months ending June 30, 2026 and 2025, net investment hedge loss of $5.5 million and loss of $45.4 million were included in OCI, respectively. For the three months ending June 30, 2026 and 2025, excluded gain of $3.1 million and loss of $1.3 million were reclassified from OCI to interest expense, respectively.

For the six months ending June 30, 2026 and 2025, net investment hedge gain of $16.4 million and loss of $49.5 million were included in OCI, respectively. For the six months ending June 30, 2026 and 2025, excluded gain of $6.1 million and loss of $2.5 million were reclassified from OCI to interest expense, respectively.

As of June 30, 2026, the aggregate fair values of the Company’s derivative instruments on the Condensed Consolidated Balance Sheets were comprised of an asset of $9.5 million, which is all included in Other current assets, and of a liability of $59.5 million, of which $35.3 million is included in Other current liabilities, the balance of $24.2 million included in the Other long-term liabilities of the Condensed Consolidated Balance Sheets.