Derivative Financial Instruments

12 Months Ended

Dec. 31, 2011

Derivative Financial Instruments [Abstract]

Derivative Financial Instruments

Note 21 — Derivative Financial Instruments

Interest Rate Risk Management

As part of the Company’s risk management strategy, the Company periodically uses interest rate swap agreements to hedge the variability of cash flows on floating rate debt obligations (see Notes 7 and 8). Accordingly, interest rate swap agreements are reflected in the consolidated balance sheets at fair value and the related gains and losses on these contracts are deferred in stockholders’ equity and recognized in interest expense over the same period in which the related interest payments being hedged are recognized in income. The fair value of an interest rate swap agreement is the estimated amount that the counterparty would receive or pay to terminate the swap agreement at the reporting date, taking into account current interest rates and the current creditworthiness of the swap counterparty.

In 2008, the Company entered into an interest rate swap agreement with a financial institution for an initial aggregate notional amount of $118,505, which increased to a maximum of $163,441 during its term and expired in 2011.

The swap agreement had an unrealized net loss of $1,414 at December 31, 2010, which was included in accumulated other comprehensive loss (see Note 22). No components of this agreement are excluded in the measurement of hedge effectiveness. As this hedge is 100% effective, there is no current impact on earnings due to hedge ineffectiveness. The fair value of the interest rate contract at December 31, 2010, $(2,244), is reported in current liabilities in the consolidated balance sheet.

Foreign Exchange Risk Management

A portion of the Company’s cash flows is derived from transactions denominated in foreign currencies. In order to reduce the uncertainty of foreign exchange rate movements on transactions denominated in foreign currencies, including the British Pound Sterling, the Euro, the Malaysian Ringgit, the Canadian Dollar and the Australian Dollar, the Company enters into foreign exchange contracts with major international financial institutions. These forward contracts, which typically mature within one year, are designed to hedge anticipated foreign currency transactions, primarily inventory purchases and sales. The terms of the foreign exchange contracts are such that cash flows from the contracts should be highly effective in offsetting the expected cash flows from the underlying forecasted transactions.

The foreign currency exchange contracts are reflected in the consolidated balance sheets at fair value. The fair value of the foreign currency exchange contracts is the estimated amount that the counterparties would receive or pay to terminate the foreign currency exchange contracts at the reporting date, taking into account current foreign exchange spot rates. The fair value adjustments at December 31, 2011 and 2010 resulted in unrealized net gains of $505, and $124, respectively, which are included in accumulated other comprehensive loss (see Note 22). No components of these agreements are excluded in the measurement of hedge effectiveness. As these hedges are 100% effective, there is no current impact on earnings due to hedge ineffectiveness. The Company anticipates that substantially all unrealized gains and losses in accumulated other comprehensive loss related to these foreign exchange contracts will be reclassified into earnings by December 2012.

The following table displays the fair values and notional amounts of the Company’s derivatives at December 31, 2011 and December 31, 2010:

	Notional Amounts				Derivative Assets										Derivative Liabilities
	December 31,		December 31,		Balance Sheet Line			Fair Value		Balance Sheet Line			Fair Value		Balance Sheet Line			Fair Value			Balance Sheet Line			Fair Value
Derivative Instrument	2011		2010		December 31, 2011					December 31, 2010					December 31, 2011						December 31, 2010
Interest Rate Swap	$	—	$	135,374				$	—				$	—				$	—			(b	) AE	$	(2,244	)
Foreign Exchange Contracts		27,884		13,468		(a	) PP		808		(a	) PP		241		(b	) AE		(18	)		(b	) AE		(44	)
Total	$	27,884	$	148,842				$	808				$	241				$	(18	)				$	(2,288	)

(a) PP = Prepaid expenses and other current assets

(b) AE = Accrued expenses