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DERIVATIVES AND HEDGING ACTIVITIES
 12 Months Ended
Sep. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVES AND HEDGING ACTIVITIES DERIVATIVES AND HEDGING ACTIVITIES
The Company is exposed to, among other things, the impact of changes in interest rates and foreign currency exchange rates in the normal course of business. The Company’s risk management program is designed to manage the exposure and volatility arising from these risks, and utilizes derivative financial instruments to offset a portion of these risks. The Company uses derivative financial instruments only to the extent necessary to hedge identified business risks and does not enter into such transactions for trading purposes. The Company generally does not require collateral or other security with counterparties to these financial instruments and is therefore subject to credit risk in the event of nonperformance; however, the Company monitors credit risk and currently does not anticipate nonperformance by other parties. The Company has agreements with each of its swap and collar counterparties that contain a provision whereby if the Company defaults on the Credit Agreement, the Company could also be declared in default on its swaps and collars resulting in an acceleration of settlement under the swaps and collars.
All derivative financial instruments are recorded at fair value in the consolidated balance sheets. For a derivative that has not been designated as an accounting hedge, the change in the fair value is recognized immediately through earnings. For a derivative that has been designated as an accounting hedge of an existing asset or liability (a fair value hedge), the change in the fair value of both the derivative and underlying asset or liability is recognized immediately through earnings. For a derivative designated as a cash flow hedge of a forecasted transaction, the entire change in the fair value of the derivative is recorded in accumulated other comprehensive income (loss) and reclassified into earnings in the same period the hedged transaction affects earnings.
Interest Rate Swap and Collar Agreements – Interest rate swap and collar agreements are used to manage interest rate risk associated with floating rate borrowings, specifically the term loans under the Credit Agreement. Under the swap agreements, the Company receives floating rate payments in exchange for making fixed rate payments over the term of the agreements, without an exchange of the underlying principal amount. Under the collar agreements, the Company pays the counterparties if the elected tenor’s Term SOFR falls below the floor rate, and the counterparties pay the Company if it exceeds the cap rate. No payments are exchanged under the collar agreements unless Term SOFR is above the cap or below the floor. Together, these agreements reduce the impact of interest rate movements on future interest expense.
The interest rate swap and collar agreements are designated and qualify as cash flow hedges. The entire change in the fair value of these instruments is recorded in accumulated other comprehensive income (loss) and is reclassified into interest expense-net in the period during which the hedged interest payments affect earnings. Cash flows related to the derivative contracts are included in cash flows from operating activities on the consolidated statements of cash flows.
During the third quarter of fiscal 2026, the Company entered into new interest rate collar agreements aggregating to a notional amount of $800 million with an effective date of June 30, 2026 and maturity date of September 30, 2030. The rate floor is 2.50% and cap is 4.50%.
The tables below summarize the key terms of the swaps and collars as of September 30, 2026 (aggregated by effective date).
Interest rate swap agreements:
Aggregate Notional Amount (in millions)Effective DateMaturity DateConversion of Related Variable Rate Debt subject to Term SOFR to Fixed Rate of:
$7009/30/20259/30/2027
3.22% plus applicable margin percentage
$1259/30/20279/30/2029
3.11% plus applicable margin percentage
$1,0259/30/20279/30/2029
3.12% plus applicable margin percentage
$9009/30/20279/30/2029
3.14% plus applicable margin percentage
Interest rate collar agreements:
Aggregate Notional Amount (in millions)Effective DateMaturity DateOffsets Variable Rate Debt Attributable to Fluctuations Below and Above:
$1,3389/30/20259/30/2027
Three-month Term SOFR rate of 2.50% (floor) and 4.50% (cap)
$7009/30/20259/30/2027
Three-month Term SOFR rate of 2.00% (floor) and 3.91% (cap)
$8006/30/20269/30/2030
Three-month Term SOFR rate of 2.50% (floor) and 4.50% (cap)
$1,5509/30/20269/30/2027
Three-month Term SOFR rate of 2.50% (floor) and 4.50% (cap)
$2,0509/30/20279/30/2029
Three-month Term SOFR rate of 2.21% (floor) and 4.25% (cap)
Certain derivative asset and liability balances are offset where master netting agreements provide for the legal right of setoff. For classification purposes, the Company records the net fair value of each type of derivative position that is expected to settle in less than one year with each counterparty as a net current asset or liability and each type of long-term position as a net non-current asset or liability. The amounts shown in the table below represent the gross amounts of recognized assets and liabilities, the amounts offset in the consolidated balance sheets and the net amounts of assets and liabilities presented therein (in millions):
September 30, 2026September 30, 2025
AssetLiabilityAssetLiability
Interest rate collar agreements63 — 7 3 
Interest rate swap agreements73 — 8 — 
Net derivatives as classified in the consolidated balance sheets (1)
$136 $— $15 $3 
(1)Refer to Note 11, “Fair Value Measurements,” for the consolidated balance sheets classification of the Company’s interest rate swap and collar agreements. The increase in the fair value of the interest rate swap and collar agreements is primarily attributable to increases in forward Term SOFR rates compared to September 30, 2025.
Based on the fair value amounts determined as of September 30, 2026, the estimated net amount of existing gains and caplet amortization expected to be reclassified into interest expense-net within the next twelve months is approximately $11 million.
Foreign Currency Forward Exchange Contracts – The Company transacts business in various foreign currencies, which subjects the Company’s cash flows and earnings to exposure related to changes in foreign currency exchange rates. These exposures arise primarily from purchases or sales of products and services from third parties. Foreign currency forward exchange contracts provide for the purchase or sale of foreign currencies at specified future dates at specified exchange rates, and are used to offset changes in the fair value of certain assets or liabilities or forecasted cash flows resulting from transactions denominated in foreign currencies. At September 30, 2026, the Company has outstanding foreign currency forward exchange contracts to sell U.S. dollars with notional amounts of $128 million. The maximum duration of the Company’s foreign currency cash flow hedge contracts at September 30, 2026 is twelve months. These notional values consist of contracts for the Canadian dollar and the euro and are stated in U.S. dollar equivalents at spot exchange rates at the respective trade dates. Amounts related to foreign currency forward exchange contracts included in accumulated other comprehensive (income) loss in stockholders’ deficit are reclassified into net sales when the hedged transaction settles. As of September 30, 2026, the Company expects to record a net loss of approximately $1 million on foreign currency forward exchange contracts designated as cash flow hedges to net sales over the next twelve months