Derivative Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2014

Fair Value of Derivative Instrument Designated as Cash Flow Hedges

The fair values of derivative instruments designated as cash flow hedges as of June 30, 2014, were as follows: 

Derivatives Designated as Cash	Asset Derivatives			Liability Derivatives
Flow Hedges	Balance Sheet Location		Fair Value	Balance Sheet Location		Fair Value
Interest rate swaps	Other assets, net	$	316	Accrued liabilities(a)	$	(4,340)
				Other long-term liabilities		(1,752)
Fuel hedge	Prepaid expenses and other current assets(b)		1,226
	Other assets, net		527
Total derivatives designated as cash flow hedges		$	2,069		$	(6,092)

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(a) Represents the estimated amount of the existing unrealized losses on interest rate swaps as of June 30, 2014 (based on the interest rate yield curve at that date), included in AOCL expected to be reclassified into pre-tax earnings within the next 12 months.  The actual amounts reclassified into earnings are dependent on future movements in interest rates. 

(b)Represents the estimated amount of the existing unrealized gains on the fuel hedge as of June 30, 2014 (based on the forward DOE diesel fuel index curve at that date), included in AOCL expected to be reclassified into pre-tax earnings within the next 12 months.  The actual amounts reclassified into earnings are dependent on future movements in diesel fuel prices.

The fair values of derivative instruments designated as cash flow hedges as of December 31, 2013, were as follows: 

Derivatives Designated as Cash	Asset Derivatives			Liability Derivatives
Flow Hedges	Balance Sheet Location		Fair Value	Balance Sheet Location		Fair Value
Interest rate swaps				Accrued liabilities	$	(3,373)
				Other long-term liabilities		(1,853)
Fuel hedge	Prepaid expenses and other current assets	$	1,304
	Other assets, net		895
Total derivatives designated as cash flow hedges		$	2,199		$	(5,226)

Impact of Cash Flow Hedges on Results of Operations, Comprehensive Income and Accumulated Other Comprehensive Loss

The following table summarizes the impact of the Company’s cash flow hedges on the results of operations, comprehensive income and AOCL for the three and six months ended June 30, 2014 and 2013: 

Derivatives Designated as Cash Flow Hedges	Amount of Gain or (Loss) Recognized as AOCL on Derivatives, Net of Tax (Effective Portion)(a)				Statement of Net Income Classification	Amount of (Gain) or Loss Reclassified from AOCL into Earnings, Net of Tax (Effective Portion) (b),(c)
	Three Months Ended June 30,					Three Months Ended June 30,
	2014		2013			2014		2013
Interest rate swaps	$	(1,362)	$	1,151	Interest expense	$	546	$	864
Fuel hedge		287		(335)	Cost of operations		(187)		-
Total	$	(1,075)	$	816		$	359	$	864

Derivatives Designated as Cash Flow Hedges	Amount of Gain or (Loss) Recognized as AOCL on Derivatives, Net of Tax (Effective Portion)(a)				Statement of Net Income Classification	Amount of (Gain) or Loss Reclassified from AOCL into Earnings, Net of Tax (Effective Portion) (b),(c)
	Six Months Ended June 30,					Six Months Ended June 30,
	2014		2013			2014		2013
Interest rate swaps	$	(1,539)	$	1,132	Interest expense	$	1,205	$	1,716
Fuel hedge		110		29	Cost of operations		(387)		-
Total	$	(1,429)	$	1,161		$	818	$	1,716

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(a)In accordance with the derivatives and hedging guidance, the effective portions of the changes in fair values of interest rate swaps and the fuel hedge have been recorded in equity as a component of AOCL.  As the critical terms of the interest rate swaps match the underlying debt being hedged, no ineffectiveness is recognized on these swaps and, therefore, all unrealized changes in fair value are recorded in AOCL.  Because changes in the actual price of diesel fuel and changes in the DOE index price do not offset exactly each reporting period, the Company assesses whether the fuel hedge is highly effective using the cumulative dollar offset approach. 

(b)Amounts reclassified from AOCL into earnings related to realized gains and losses on interest rate swaps are recognized when interest payments or receipts occur related to the swap contracts, which correspond to when interest payments are made on the Company’s hedged debt. 

(c)Amounts reclassified from AOCL into earnings related to realized gains and losses on the fuel hedge are recognized when settlement payments or receipts occur related to the hedge contract, which correspond to when the underlying fuel is consumed. 

Interest Rate Swap [Member]

Company's derivative instruments

At June 30, 2014, the Company’s derivative instruments included seven interest rate swap agreements as follows: 

Date Entered	Notional Amount		Fixed Interest Rate Paid*	Variable Interest Rate Received	Effective Date	Expiration Date
August 2011	$	150,000	0.800%	1-month LIBOR	April 2012	January 2015
December 2011	$	175,000	1.600%	1-month LIBOR	February 2014	February 2017
April 2014	$	100,000	1.800%	1-month LIBOR	July 2014	July 2019
May 2014	$	50,000	2.344%	1-month LIBOR	October 2015	October 2020
May 2014	$	25,000	2.326%	1-month LIBOR	October 2015	October 2020
May 2014	$	50,000	2.350%	1-month LIBOR	October 2015	October 2020
May 2014	$	50,000	2.350%	1-month LIBOR	October 2015	October 2020

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*  Plus applicable margin.

Fuel [Member] | Commodity Contract [Member]

Company's derivative instruments

At June 30, 2014, the Company’s derivative instruments included one fuel hedge agreement as follows:   

Date Entered	Notional Amount (in gallons per month)	Diesel Rate Paid Fixed (per gallon)	Diesel Rate Received Variable	Effective Date	Expiration Date
June 2012	300,000	$ 3.60	DOE Diesel Fuel Index*	January 2014	December 2015

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*  If the national U.S. on-highway average price for a gallon of diesel fuel (“average price”), as published by the Department of Energy (“DOE”), exceeds the contract price per gallon, the Company receives the difference between the average price and the contract price (multiplied by the notional number of gallons) from the counterparty.  If the average price is less than the contract price per gallon, the Company pays the difference to the counterparty.