Quarterly report pursuant to Section 13 or 15(d)

Derivative Instruments and Hedging Activities

v3.10.0.1
Derivative Instruments and Hedging Activities
 6 Months Ended
Jun. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
At June 30, 2018 and December 31, 2017, the following table presents information about the fair value amounts of the Company’s derivative instruments is as follows:
 
Derivatives as of
 
June 30, 2018
 
December 31, 2017
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Derivatives Designated as Hedging Instruments:
 
 
 
 
 
 
 
Interest rate swap contracts
Other assets
 
$
1,251

 
Other assets
 
$
233

Interest rate swap contracts
Other liabilities
 
$
2,162

 
Other liabilities
 
$
3,529

Derivatives Not Designated as Hedging Instruments:
 
 
 
 
 
 
 
Interest rate swap contracts
Other assets
 
$
47

 
Other assets
 
$
—

Interest rate swap contracts
Other liabilities
 
$
252

 
Other liabilities
 
$
—

Commodity swap contracts
Other assets
 
$
21

 
Other assets
 
$
—

Commodity swap contracts
Other liabilities
 
$
66

 
Other liabilities
 
$
—


All but five of the Company’s derivatives were designated as hedging instruments as of June 30, 2018 and all but one of the Company’s derivatives were designated as hedging instruments as of December 31, 2017.

The following tables present information about the effects of the Company’s derivative instruments on the consolidated statements of income (loss) and consolidated statements of comprehensive income (loss):
 
Location of Gain Recognized in Net Income (Loss)
 
Amount of Gain Recognized in Net Income (Loss)
 
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
 
2018
 
2017
 
2018
 
2017
Derivatives Designated as Hedging Instruments:
 
 
 
 
 
 
 
 
 
Interest rate swap contracts
Other expenses, net
 
$
(31
)
 
$
(55
)
 
$
(133
)
 
$
(178
)
Derivatives not Designated as Hedging Instruments:
 
 
 
 
 
 
 
 
 
Interest rate swap contracts
Other expenses, net
 
$
(61
)
 
$
—

 
$
(73
)
 
$
—

Commodity swap contracts
Other expenses, net
 
$
45

 
$
—

 
$
45

 
$
—

    
 
Six Months Ended
 
June 30, 2018
Derivatives Designated as Hedging Instruments:
 
     Accumulated loss in AOCI at the beginning of the period
$
(1,745
)
            Unrealized gain recognized in AOCI
1,689

            Gain reclassified from AOCI to other expenses, net
(125
)
     Accumulated loss in AOCI at the end of the period
$
(181
)

Interest Rate Swaps
In March 2010, the Company entered into a fourteen-year interest rate swap contract under which the Company agreed to pay an amount equal to a specified fixed rate of interest times a notional amount, and to in turn receive an amount equal to a specified variable rate of interest times the same notional principal amount. The swap covers an initial notional amount of approximately $27,900 variable rate note at a fixed interest rate of 3.74% and expires in December 2024. This swap was designated as a hedge in March 2013. During the second quarter of 2014, this swap was de-designated and re-designated as a hedge as a result of a partial pay down of the associated hedged debt principal. As a result $566 was reclassified from accumulated other comprehensive loss and recorded as a reduction to other expenses, net in the Company’s consolidated statements of income (loss) during the second quarter of 2014. During the second quarter 2018, this swap was de-designated hedge as a result of the expected pay down of the associated hedged debt principal. As a result, $34 was reclassified from accumulated other comprehensive loss and recorded to other expenses, net in the Company’s consolidated statements of income (loss) during the six months ended June 30, 2018.
In June 2018, the company entered into a fifteen-year interest rate swap contract under which the Company agreed to pay an amount equal to a specified fixed rate of interest times a notional amount, and to in return receive an amount equal to a specified variable rate of interest times the same notional principal amount. The swap covers an initial notional amount of $10,000 variable rate note at a fixed rate of 3.19%, with an effective date of June 2018 and expires in June 2033. This interest swap has been designated as a hedging instrument.
In February 2018, the Company entered into a three-year interest rate swap contract under which the Company agreed to pay an amount equal to a specified fixed rate of interest times a notional amount, and to in turn receive an amount equal to a specified variable rate of interest times the same notional principal amount. The swap covers an initial notional amount of$17,100 at a fixed interest rate of 2.45% with an effective date of March 29, 2018, and expires in December 2020. This interest swap is not designated as a hedging instrument.
Commodity Swaps
In March 2018, the company entered into a one-year commodity swap contract under which the Company agreed to pay an amount equal to a specified fixed rate for natural gas times a notional volume amount, and to in turn receive an amount equal to a specified variable rate for natural gas times the same notional volume amount. The swap covers an initial notional volume amount of 323,390 million British thermal units, (“MMBtus”) of natural gas at a fixed rate of $2.84 per MMBtu, with an effective date of May 2018 and expires in April 2019. This commodity swap is not designated as a hedging instrument.
In April 2018, the company entered into a one-year commodity swap contract under which the Company agreed to pay an amount equal to a specified fixed rate for natural gas times a notional volume amount, and to in turn receive an amount equal to a specified variable rate for natural gas times the same notional volume amount. The swap covers an initial notional volume amount of 437,004 MMBtus of natural gas at a fixed rate of $2.68 per MMBtu, with an effective date of May 2019 and expires in April 2020. This commodity swap is not designated as a hedging instrument.
In April 2018, the company entered into a one-year commodity swap contract under which the Company agreed to pay an amount equal to a specified fixed rate for natural gas times a notional volume amount, and to in turn receive an amount equal to a specified variable rate for natural gas times the same notional volume amount. The swap covers an initial notional volume amount of 435,810 MMBtus of natural gas at a fixed rate of $2.70 per MMBtu, with an effective date of May 2020 and expires in April 2021. This commodity swap is not designated as a hedging instrument.