Derivative Financial Instruments and Fair Value |
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| Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Derivative Financial Instruments and Fair Value | Note 6. Derivative Financial Instruments and Fair Value The Company is exposed to various market risks including, but not limited to, foreign currency exchange rates, commodity prices, and market interest rates. The Company strives to control its exposure to these risks through its normal operating activities and, where appropriate, through the use of derivative financial instruments. Derivative financial instruments are measured at fair value on a recurring basis using various pricing models that incorporate observable market parameters, such as interest rate yield curves and foreign currency rates and are classified as Level 2 within the fair value hierarchy. For a designated cash flow hedge, the effective portion of the change in the fair value of the derivative financial instrument is recorded in accumulated other comprehensive income (loss) (“AOCI(L)”) in the condensed consolidated balance sheets. When the underlying hedged transaction is realized, the gain or loss previously included in AOCI(L) is recorded in earnings and reflected in the condensed consolidated statements of operations on the same line as the gain or loss on the hedged item attributable to the hedged risk. The gain or loss associated with changes in the fair value of derivatives not designated as hedges are recorded immediately in the condensed consolidated statements of operations on the same line as the associated risk. For a designated net investment hedge, the effective portion of the change in the fair value of the derivative financial instrument is recorded as a cumulative translation adjustment in AOCI(L) in the condensed consolidated balance sheets. Derivative Instruments Foreign Currency Forwards — The Company uses short-term foreign currency forward contracts to mitigate the effect on earnings that exchange rate fluctuations have on non-functional currency balance sheet exposures. These forward contracts are not designated as hedging instruments. As of August 1, 2026 and May 2, 2026, the Company held foreign currency forward contracts with a notional value of $129.2 million and $126.3 million, respectively. During the three months ended August 1, 2026 and August 2, 2025, the Company recognized losses of $0.3 million and $0.2 million, respectively, related to foreign currency forward contracts in other expense (income), net in the condensed consolidated statements of operations. Hedging Instruments Hedge effectiveness is assessed at the inception of the hedging relationship and quarterly thereafter. The effective portion of the periodic changes in fair value is recognized in AOCI(L) in the condensed consolidated balance sheets. Subsequently, the accumulated gains and losses recorded in AOCI(L) are reclassified to income in the period during which the hedged cash flow affects earnings, which are expected to be immaterial over the next 12 months. No ineffectiveness was recognized in the three months ended August 1, 2026 and August 2, 2025. Net Investment Hedge — Foreign Currency Borrowings The Company has foreign currency denominated debt under its revolving credit facility (see Note 7, “Debt”). During the period ended August 2, 2025, the Company designated €55.0 million of these long-term borrowings as a net investment hedge of its euro-denominated subsidiaries. Changes to the carrying value of these designated euro-denominated borrowings are recorded in other comprehensive income (loss) as currency translation adjustments. Cash Flow Hedge — Interest rate swaps The Company utilizes interest rate swaps to limit its exposure to market fluctuations on its variable-rate borrowings. The interest rate swaps effectively convert a portion of the Company's variable rate borrowings to a fixed rate based upon a determined notional amount. The Company has an interest rate swap, maturing on October 31, 2027, with a notional value of $152.2 million (€132.0 million). The interest rate swap is designated as a cash flow hedge. Effect of hedging instruments on comprehensive income (loss) The pre-tax effects of derivative financial instruments recorded in other comprehensive income (loss) were as follows:
Assets and Liabilities Measured at Fair Value on a Recurring Basis Cash and cash equivalents Cash and cash equivalents consist of cash and highly liquid investments with maturities of three months or less. Highly liquid investments include money market funds which are classified within Level 1 of the fair value hierarchy. Asset and liability instruments The carrying value of cash and cash equivalents, short and long-term receivables, accounts payable, and short-term and long-term debt approximates fair value. Derivative instruments The fair value of derivative instruments is classified as Level 2 within the fair value hierarchy and recorded in the condensed consolidated balance sheets as follows:
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