v3.26.1
Derivative Financial Instruments
 6 Months Ended
Jun. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Derivative Financial Instruments
Derivatives recorded on the Condensed Consolidated Balance Sheets:
The following table is a summary of the fair value of derivatives outstanding at June 30, 2026 and December 31, 2025:
Fair Value
June 30, 2026December 31, 2025
Assets(a) Accrued Liabilities Assets(a)Accrued Liabilities
Derivatives Designated as Cash Flow Hedges
Currency Contracts $1 $— $— $— 
Interest Rate Swaps 20 — 7 1 
Total Hedges $21 $— $7 $1 
Derivatives Not Designated as Cash Flow Hedges
Currency Contracts — 4 5 — 
Total Derivatives $21 $4 $12 $1 
(a) At June 30, 2026 and December 31, 2025, current assets of $21 million and $12 million, respectively, are recorded in prepaid and other current assets on the Condensed Consolidated Balance Sheets.
Derivatives' Impact on the Condensed Consolidated Statement of Operations:
The following table summarizes the impact of the Company's derivatives on the unaudited Condensed Consolidated Statement of Operations:
Amount of Pre-Tax Gain (Loss) Recognized in Earnings Amount of Pre-Tax Gain (Loss) Recognized in Earnings
Revenue Cost of Goods SoldOther income (expense), netRevenueCost of Goods SoldOther income (expense), net
Three Months Ended June 30, 2026Three Months Ended June 30, 2025
Derivatives Not Designated as Hedging Instruments
Currency Contracts$— $— $(1)$— $— $(1)
Derivatives Designated as Hedging Instruments
Currency Contracts $— $1 $— $2 $(1)$— 
Total Derivatives $— $1 $(1)$2 $(1)$(1)
Amount of Pre-Tax Gain (Loss) Recognized in Earnings Amount of Pre-Tax Gain (Loss) Recognized in Earnings
RevenueCost of Goods SoldOther income (expense), netRevenueCost of Goods SoldOther income (expense), net
Six Months Ended June 30, 2026Six Months Ended June 30, 2025
Derivatives Not Designated as Hedging Instruments
Currency Contracts$— $— $3 $— $— $(1)
Derivatives Designated as Hedging Instruments
Currency Contracts $— $1 $— $2 $(1)$— 
Natural Gas Hedges— 1 — — — — 
Total Derivatives $— $2 $3 $2 $(1)$(1)
Interest Rate Risk
As of June 30, 2026, the Company maintains a total of $950 million of interest rate swaps (with $450 million maturing in March 2028 and $500 million maturing in September 2031) with the objective of using the interest-rate swap agreements to add stability to interest expense and to manage the Company's exposure to interest rate movements. These interest rate swaps have been designated as cash flow hedges and involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Fair value gains or losses on these cash flow hedges are recorded in accumulated other comprehensive loss and are subsequently reclassified into interest expense in the same periods during which the hedged transactions affect earnings.
At June 30, 2026 and December 31, 2025, the net unrealized gain of $15 million and the net unrealized loss of less than $1 million, respectively, was recorded in "Accumulated other comprehensive loss" on the unaudited Condensed Consolidated Balance Sheet. For the three and six months ended June 30, 2026, the amounts recorded in interest expense related to the interest-rate swap agreements were less than $1 million and $1 million, respectively, of which less than $1 million and $1 million was reclassified from "Accumulated other comprehensive loss" to interest expense. For the three and six months ended June 30, 2025, the net amounts recorded in interest expense related to the interest-rate swap agreements $2 million and $4 million, respectively.
Foreign Currency Risk
From time to time, we enter into foreign currency contracts used to hedge forecasted third party non-functional currency sales for our South African subsidiaries. From time to time, we enter into foreign currency contracts used to hedge forecasted non-functional currency cost of goods sold and forecasted non-functional currency selling, general and administrative expenses ("SG&A expenses") for our Australian subsidiaries. Historically, we have used a combination of zero-cost collars, put options or forward contracts to reduce the exposure. These foreign currency contracts are designated as cash flow hedges. Changes to the fair value of these foreign currency contracts are recorded as a component of other comprehensive (loss) income, if these contracts remain highly effective, and are recognized in net sales, costs of goods sold or SG&A expenses in the period in which the forecasted transaction affects earnings or are recognized in other income (expense), net when the transactions are no longer probable of occurring. As of June 30, 2026, we had notional amounts of 374 million Australian dollars ($259 million at the June 30, 2026 exchange rate) that expire between July 29, 2026 and December 29, 2026 to reduce the exposure of our Australian subsidiaries’ cost of sales to fluctuations in currency rates. As of June 30, 2026, we had notional amounts of 15 million Australian dollars ($10 million at the June 30, 2026 exchange rate) that expire between July 29, 2026 and December 29, 2026 to reduce the exposure of our Australian subsidiaries’ SG&A expenses to fluctuations in currency rates. As of June 30, 2026, we had notional amounts of 2 billion South African Rand (or approximately $92 million at the June 30, 2026 exchange rate) that expire between July 29, 2026 and December 29, 2026 to reduce the exposure of our South African subsidiaries' third party sales to fluctuations in currency rates. At June 30, 2026, there was a net unrealized gain of $2 million recorded in "Accumulated other comprehensive loss" on the unaudited Condensed Consolidated Balance Sheet, which is expected to be fully recognized in earnings over the next twelve months. At December 31, 2025, there was a net realized gain of $1 million recorded in "Accumulated other comprehensive loss" on the Condensed Consolidated Balance Sheet.
From time to time, we enter into foreign currency contracts for the South African Rand, Australian Dollar, Euro, Pound Sterling, and Saudi Riyal to reduce exposure of our subsidiaries’ balance sheet accounts not denominated in our subsidiaries’ functional currency to fluctuations in foreign currency exchange rates. Historically, we have used forward contracts to reduce the exposure.  For accounting purposes, these foreign currency contracts are not considered hedges. The change in fair value associated with these contracts is recorded in “Other income (expense), net” within the unaudited Condensed Consolidated Statement of Operations and partially offsets the change in value of third party and intercompany-related receivables not denominated in the functional currency of the subsidiary. At June 30, 2026, there was (i) 1 billion South African Rand (or approximately $67 million at the June 30, 2026 exchange rate), (ii) 149 million Australian dollars (or approximately $103 million at the June 30, 2026 exchange rate), (iii) 111 million Pound Sterling (or approximately $147 million at the June 30, 2026 exchange rate), (iv) 37 million Euro (or approximately $42 million at the June 30, 2026 exchange rate), and (v) 163 million Saudi Riyal (or approximately $43 million at the June 30, 2026 exchange rate) of notional amounts of outstanding foreign currency contracts. At December 31, 2025, there was (i) 572 million South African Rand (or approximately $35 million at the June 30, 2026 exchange rate), (ii) 161 million Australian dollars (or approximately $111 million at the June 30, 2026 exchange rate), (iii) 213 million Pound Sterling (or approximately $282 million at the June 30, 2026 exchange rate), (iv) 50 million Euro (or approximately $57 million at the June 30, 2026 exchange rate) and (v) 83 million Saudi Riyal (or approximately $22 million at the June 30, 2026 exchange rate) of notional amounts of outstanding foreign currency contracts.