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Financial Instruments and Fair Value Measurements (Tables)
6 Months Ended
Jul. 01, 2022
Fair Value Disclosures [Abstract]  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis
The following tables provide information regarding assets and liabilities recorded at fair value on a recurring basis (in thousands):
Fair ValueQuoted
Prices in
Active
Markets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
July 1, 2022
Assets: Interest rate swaps$841 $— $841 $— 
Assets: Foreign currency hedging contracts1,395 — 1,395 — 
Liabilities: Foreign currency hedging contracts1,126 — 1,126 — 
Liabilities: Contingent consideration9,072 — — 9,072 
December 31, 2021
Assets: Foreign currency hedging contracts$687 $— $687 $— 
Liabilities: Interest rate swap2,978 — 2,978 — 
Liabilities: Contingent consideration2,415 — — 2,415 
Information regarding the Company’s outstanding interest rate swap designated as cash flow hedges as of July 1, 2022 is as follows (dollars in thousands):
Notional AmountStart DateEnd
Date
Pay Fixed RateReceive Current Floating RateFair ValueBalance Sheet Location
$150,000 Jun 2020Jun 20232.1785 %1.6240 %$841 Prepaid expenses and other current assets
Information regarding the Company’s outstanding interest rate swap designated as cash flow hedges as of December 31, 2021 is as follows (dollars in thousands):
Notional AmountStart DateEnd
Date
Pay Fixed RateReceive Current Floating RateFair ValueBalance Sheet Location
$150,000 Jun 2020Jun 20232.1785 %0.1013 %$(2,978)Other long-term liabilities
Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of July 1, 2022 is as follows (dollars in thousands):
Notional AmountEnd
Date
$/Foreign CurrencyFair ValueBalance Sheet Location
$10,923 Dec 20220.0455MXN Peso$728 Prepaid expenses and other current assets
6,830 Dec 20221.1383Euro(522)Accrued expenses and other current liabilities
4,106 Dec 20220.0216UYU Peso667 Prepaid expenses and other current assets
6,760 Dec 20221.1266Euro(453)Accrued expenses and other current liabilities
3,833 Dec 20221.0952Euro(151)Accrued expenses and other current liabilities
Information regarding outstanding foreign currency forward contracts designated as cash flow hedges as of December 31, 2021 is as follows (dollars in thousands):
Notional AmountEnd
Date
$/Foreign CurrencyFair ValueBalance Sheet Location
$22,201 Dec 20220.0463MXN Peso$408 Prepaid expenses and other current assets
17,017 Dec 20221.1344Euro130 Prepaid expenses and other current assets
9,020 Dec 20220.0220UYU Peso149 Prepaid expenses and other current assets
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)
The following tables present the effect of cash flow hedge derivative instruments on other comprehensive income (loss) (“OCI”), AOCI and the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended July 1, 2022 and July 2, 2021 (in thousands):
Three Months Ended
July 1, 2022July 2, 2021
TotalAmount of Gain (Loss) on Cash Flow Hedge ActivityTotalAmount of Gain (Loss) on Cash Flow Hedge Activity
Sales$350,081 $(371)$312,023 $29 
Cost of sales257,184 554 223,277 450 
Operating expenses60,190 112 49,396 11 
Interest expense7,773 (526)7,532 (995)
Six Months Ended
July 1, 2022July 2, 2021
TotalAmount of Gain (Loss) on Cash Flow Hedge ActivityTotalAmount of Gain (Loss) on Cash Flow Hedge Activity
Sales$660,993 $(425)$602,490 $37 
Cost of sales486,621 746 429,258 1,074 
Operating expenses119,168 136 99,274 38 
Interest expense13,741 (1,293)16,064 (2,029)
Unrealized Gain (Loss) Recognized in OCIRealized Gain (Loss) Reclassified from AOCI
Three Months Ended
Location in Statements of Operations and Comprehensive Income (Loss)
Three Months Ended
July 1,
2022
July 2,
2021
July 1,
2022
July 2,
2021
Interest rate swap$702 $(375)Interest expense$(526)$(995)
Foreign exchange contracts(1,167)148 Sales(371)29 
Foreign exchange contracts96 725 Cost of sales554 450 
Foreign exchange contracts78 67 Operating expenses112 11 
Six Months Ended
Location in Statements of Operations and Comprehensive Income (Loss)
Six Months Ended
July 1,
2022
July 2,
2021
July 1,
2022
July 2,
2021
Interest rate swaps$2,526 $(109)Interest expense$(1,293)$(2,029)
Foreign exchange contracts(1,681)(738)Sales(425)37 
Foreign exchange contracts1,365 166 Cost of sales746 1,074 
Foreign exchange contracts355 (23)Operating expenses136 38 
Schedule of Estimated Fair Values for Contingent Consideration
The following table presents the changes in the estimated fair values of the Company’s liabilities for contingent consideration measured using significant unobservable inputs (Level 3) for the three and six months ended July 1, 2022 and July 2, 2021 (in thousands):
 Three Months EndedSix Months Ended
July 1,
2022
July 2,
2021
July 1,
2022
July 2,
2021
Fair value measurement at beginning of period$1,976 $2,281 $2,415 $3,900 
Amount recorded for current year acquisitions
7,375 — 7,375 — 
Fair value measurement adjustment— — 54 — 
Payments
— — (493)(1,621)
Foreign currency translation(279)— (279)
Fair value measurement at end of period$9,072 $2,281 $9,072 $2,281 
Schedule of Contingent Consideration Measurement Inputs
The following table provides quantitative information associated with the fair value measurement of the Company’s liabilities for contingent consideration:
July 1, 2022
Contingency TypeMaximum Payout (undiscounted)Fair ValueValuation TechniqueUnobservable InputsWeighted Average or Range
Revenue-based payments:
InoMec and USB$5,375 $1,976 Monte CarloRevenue volatility26.7 %
Discount rate1.8 %
Projected year(s) of payment2022-2024
Aran$10,484 $7,096 
Probability-weighted expected returns method
Probability of occurrence
0% - 50%
Discount rate9.7 %
Projected year(s) of payment2023
December 31, 2021
Contingency TypeMaximum Payout (undiscounted)Fair ValueValuation TechniqueUnobservable InputsWeighted Average or Range
Revenue-based payments:
InoMec and USB$6,750 $2,415 Monte CarloRevenue volatility29.0 %
Discount rate1.8 %
Projected year(s) of payment2022-2024
(13.)     FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
Schedule of Equity Method Investments
Equity investments comprise the following (in thousands):
July 1,
2022
December 31,
2021
Equity method investment$13,468 $16,192 
Non-marketable equity securities5,637 5,637 
Total equity investments
$19,105 $21,829 
The components of Loss on equity investments for each period were as follows (in thousands):
Three Months EndedSix Months Ended
July 1,
2022
July 2,
2021
July 1,
2022
July 2,
2021
Equity method investment loss$320 $684 $2,724 $2,019