Derivative Instruments (Tables)

3 Months Ended

Apr. 29, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Outstanding Foreign Exchange Forward Contracts

As of April 29, 2017, the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge either a portion, or all, of forecasted foreign-currency-denominated intercompany inventory sales, the resulting settlement of the foreign-currency-denominated intercompany accounts receivable, or both:



(in thousands)	Notional Amount⁽¹⁾
Euro	$	81,038
British pound	$	30,243
Canadian dollar	$	15,119
Japanese yen	$	7,934


⁽¹⁾	Amounts reported are the U.S. Dollar notional amounts outstanding as of April 29, 2017.

The Company also uses foreign currency exchange forward contracts to hedge certain foreign-currency-denominated net monetary assets/liabilities. Examples of monetary assets/liabilities include cash balances, receivables and payables. Fluctuations in exchange rates result in transaction gains/(losses) being recorded in earnings as U.S. GAAP requires that monetary assets/liabilities be remeasured at the spot exchange rate at quarter-end or upon settlement. The Company has chosen not to apply hedge accounting to these instruments because there are no differences in the timing of gain or loss recognition on the hedging instruments and the hedged items.

As of April 29, 2017, the Company had outstanding the following foreign currency exchange forward contracts that were entered into to hedge foreign-currency-denominated net monetary assets/liabilities:



(in thousands)	Notional Amount⁽¹⁾
Euro	$	13,895
British pound	$	1,283


⁽¹⁾	Amounts reported are the U.S. Dollar notional amounts outstanding as of April 29, 2017.

Location and Amounts of Derivative Fair Values on the Condensed Consolidated Balance Sheets

The location and amounts of derivative fair values on the Condensed Consolidated Balance Sheets as of April 29, 2017 and January 28, 2017 were as follows:



(in thousands)	Location	April 29, 2017		January 28, 2017		Location	April 29, 2017		January 28, 2017
Derivatives designated as hedging instruments:
Foreign currency exchange forward contracts	Other current assets	$	2,415	$	5,920	Accrued expenses	$	1,226	$	486
Derivatives not designated as hedging instruments:
Foreign currency exchange forward contracts	Other current assets	$	—	$	122	Accrued expenses	$	17	$	6
Total	Other current assets	$	2,415	$	6,042	Accrued expenses	$	1,243	$	492

Location and Amounts of Derivative Gains and Losses on the Condensed Consolidated Statements of Operations and Comprehensive Loss

The location and amounts of derivative gains and losses for the thirteen weeks ended April 29, 2017 and April 30, 2016 on the Condensed Consolidated Statements of Operations and Comprehensive Loss were as follows:



		Thirteen Weeks Ended
		April 29, 2017		April 30, 2016
(in thousands)	Location	Gain/(Loss)		Gain/(Loss)
Derivatives not designated as hedging instruments:
Foreign currency exchange forward contracts	Other operating income, net	$	28	$	(1,777	)



	Effective Portion											Ineffective Portion and Amount Excluded from Effectiveness Testing
	Amount of Loss Recognized in OCI on Derivative Contracts ⁽¹⁾						Location of Gain Reclassified from AOCL into Earnings	Amount of Gain Reclassified from AOCL into Earnings ⁽²⁾				Location of Gain Recognized in Earnings on Derivative Contracts	Amount of Gain Recognized in Earnings on Derivative Contracts ⁽³⁾
	Thirteen Weeks Ended
(in thousands)	April 29, 2017			April 30, 2016				April 29, 2017		April 30, 2016			April 29, 2017		April 30, 2016
Derivatives in cash flow hedging relationships:
Foreign currency exchange forward contracts	$	(1,373	)	$	(9,382	)	Cost of sales, exclusive of depreciation and amortization	$	3,535	$	2,305	Other operating income, net	$	528	$	355


⁽¹⁾	The amount represents the change in fair value of derivative contracts due to changes in spot rates.


⁽²⁾	The amount represents the reclassification from AOCL into earnings when the hedged item affects earnings, which is when merchandise is sold to the Company’s customers.


⁽³⁾	The amount represents the change in fair value of derivative contracts due to changes in the difference between the spot price and forward price that is excluded from the assessment of hedge effectiveness and, therefore, recognized in earnings.