Derivative Financial Instruments and Hedging Activities (Tables)
|
9 Months Ended |
Oct. 01, 2016 |
|---|
| Outstanding Derivatives on Individual Contract Basis |
The following table presents outstanding derivatives on an
individual contract basis:
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Fair Value of Derivatives
with Unrealized Gains
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Fair Value of Derivatives
with Unrealized Losses
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| In thousands |
|
September 2016 |
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December 2015 |
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September 2015 |
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September 2016 |
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December 2015 |
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September 2015 |
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Foreign currency exchange contracts designated as hedging
instruments
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$ |
75,497 |
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|
$ |
105,536 |
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$ |
94,113 |
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|
$ |
(31,996 |
) |
|
$ |
(27,896 |
) |
|
$ |
(46,808 |
) |
|
Foreign currency exchange contracts not designated as hedging
instruments
|
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|
— |
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|
255 |
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|
112 |
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|
(185 |
) |
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(136 |
) |
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(373 |
) |
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Total derivatives
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$ |
75,497 |
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$ |
105,791 |
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$ |
94,225 |
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$ |
(32,181 |
) |
|
$ |
(28,032 |
) |
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$ |
(47,181 |
) |
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| Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from Current Gross |
VF records and presents the fair values of all of its derivative
assets and liabilities in the Consolidated Balance Sheets on a
gross basis, even though they are subject to master netting
agreements. However, if VF were to offset and record the asset and
liability balances of its forward foreign currency exchange
contracts on a net basis in accordance with the terms of its master
netting agreements, the amounts presented in the Consolidated
Balance Sheets would be adjusted from the current gross
presentation to the net amounts as detailed in the following
table:
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September 2016 |
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December 2015 |
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September 2015 |
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| In thousands |
|
Derivative
Asset |
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Derivative
Liability |
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Derivative
Asset |
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Derivative
Liability |
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Derivative
Asset |
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Derivative
Liability |
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Gross amounts presented in the
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Consolidated Balance Sheets
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$ |
75,497 |
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$ |
(32,181 |
) |
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$ |
105,791 |
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$ |
(28,032 |
) |
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$ |
94,225 |
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$ |
(47,181 |
) |
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Gross amounts not offset in the
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Consolidated Balance Sheets
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(19,328 |
) |
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19,328 |
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(22,213 |
) |
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22,213 |
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(36,597 |
) |
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36,597 |
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Net amounts
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$ |
56,169 |
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|
$ |
(12,853 |
) |
|
$ |
83,578 |
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$ |
(5,819 |
) |
|
$ |
57,628 |
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$ |
(10,584 |
) |
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| Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from Current Gross |
VF records and presents the fair values of all of its derivative
assets and liabilities in the Consolidated Balance Sheets on a
gross basis, even though they are subject to master netting
agreements. However, if VF were to offset and record the asset and
liability balances of its forward foreign currency exchange
contracts on a net basis in accordance with the terms of its master
netting agreements, the amounts presented in the Consolidated
Balance Sheets would be adjusted from the current gross
presentation to the net amounts as detailed in the following
table:
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September 2016 |
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December 2015 |
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September 2015 |
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| In thousands |
|
Derivative
Asset |
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|
Derivative
Liability |
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Derivative
Asset |
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Derivative
Liability |
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Derivative
Asset |
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Derivative
Liability |
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Gross amounts presented in the
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Consolidated Balance Sheets
|
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$ |
75,497 |
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$ |
(32,181 |
) |
|
$ |
105,791 |
|
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$ |
(28,032 |
) |
|
$ |
94,225 |
|
|
$ |
(47,181 |
) |
|
Gross amounts not offset in the
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Consolidated Balance Sheets
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(19,328 |
) |
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19,328 |
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(22,213 |
) |
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22,213 |
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(36,597 |
) |
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36,597 |
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Net amounts
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$ |
56,169 |
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$ |
(12,853 |
) |
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$ |
83,578 |
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$ |
(5,819 |
) |
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$ |
57,628 |
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$ |
(10,584 |
) |
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| Derivatives Classified as Current or Noncurrent Based on Maturity Dates |
Derivatives are classified as current or noncurrent based on
maturity dates, as follows:
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| In thousands |
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September 2016
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December 2015 |
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September 2015
|
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Other current assets
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$ |
66,231 |
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$ |
92,796 |
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$ |
85,405 |
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Accrued liabilities
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(28,852 |
) |
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(25,776 |
) |
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(40,969 |
) |
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Other assets
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9,266 |
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12,995 |
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8,820 |
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Other liabilities
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(3,329 |
) |
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(2,256 |
) |
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(6,212 |
) |
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| Effects of Cash Flow Hedging included in Consolidated Statements of Income and Consolidated Statements of Comprehensive Income |
The effects of cash flow hedging included in VF’s
Consolidated Statements of Income and Consolidated Statements of
Comprehensive Income are summarized as follows:
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| In thousands |
|
Gain (Loss) on Derivatives
Recognized in OCI
Three Months Ended September
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Gain (Loss) on Derivatives
Recognized in OCI
Nine Months Ended September
|
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Cash Flow Hedging Relationships
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2016 |
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2015 |
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2016 |
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2015 |
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Foreign currency exchange
|
|
$ |
9,571 |
|
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$ |
5,634 |
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$ |
32,837 |
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$ |
52,068 |
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| In thousands |
|
Gain (Loss) Reclassified from
Accumulated OCI into Income
Three Months Ended September
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Gain (Loss) Reclassified from
Accumulated OCI into Income
Nine Months Ended September
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Location of Gain (Loss)
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2016 |
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2015 |
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2016 |
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2015 |
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Net sales
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$ |
14,676 |
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$ |
(22,434 |
) |
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$ |
11,997 |
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$ |
(51,279 |
) |
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Cost of goods sold
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15,485 |
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39,142 |
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|
80,094 |
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|
80,633 |
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Selling, general and administrative expenses
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(1,098 |
) |
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— |
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(3,611 |
) |
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— |
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Other income (expense), net
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|
526 |
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|
7,541 |
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|
2,653 |
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|
20,515 |
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Interest expense
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(1,131 |
) |
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(1,078 |
) |
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(3,356 |
) |
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(3,200 |
) |
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Total
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$ |
28,458 |
|
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$ |
23,171 |
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$ |
87,777 |
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$ |
46,669 |
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| Effects of Fair Value Hedging Included in Consolidated Statements of Income |
Following is a summary of these derivatives included in VF’s
Consolidated Statements of Income:
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In thousands
Derivatives Not Designated as Hedges
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Location of Gain (Loss)
on Derivatives
Recognized in Income
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Gain (Loss) on Derivatives
Recognized in Income
Three Months Ended September
|
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Gain (Loss) on Derivatives
Recognized in Income
Nine Months Ended September
|
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| |
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
|
Foreign currency exchange
|
|
|
Cost of goods sold |
|
|
$ |
(510 |
) |
|
$ |
— |
|
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$ |
225 |
|
|
$ |
— |
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|
Foreign currency exchange
|
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|
Other income (expense), net |
|
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|
(110 |
) |
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|
836 |
|
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|
(1,196 |
) |
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|
(1,625 |
) |
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Total
|
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|
$ |
(620 |
) |
|
$ |
836 |
|
|
$ |
(971 |
) |
|
$ |
(1,625 |
) |
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