Derivative Instruments and Hedging Activities

12 Months Ended

Mar. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Changes in interest rates expose us to risks. To help us manage these risks, in January 2020 we entered into two interest rate swaps to hedge a total of $400.0 million of our variable interest debt. The fair value of these interest rate swaps is reflected in the Consolidated Balance Sheets in other accrued liabilities and other long-term liabilities. We do not use derivatives for trading purposes.

The following table summarizes the fair values of our derivative instruments as of the March 31, 2020:


(In thousands)	Hedge Type	Final Settlement Date	Notional Amount		Other Accrued Liabilities		Other Long-Term Liabilities
Interest rate swap	Cash flow	1/31/2021	$	200,000	$	(1,905)	$	—
Interest rate swap	Cash flow	1/31/2022	$	200,000	—		(4,412)
Total fair value					$	(1,905)	$	(4,412)

The following table summarizes our interest rate swaps, net of tax, for the periods shown:


(In thousands)	Location		2020		2019
Loss Recognized in Other Comprehensive Loss (effective portion)		Other comprehensive income (loss)		(4,864)		$	—
Gain (Loss) Reclassified from Accumulative Other Comprehensive Loss into Income		Interest expense		—		—
Gain Recognized as Income		Interest expense		62		—

We expect pre-tax losses of $1.9 million associated with interest rate swaps, currently reported in accumulated other comprehensive loss, to be reclassified into income over the next twelve months. The amount ultimately realized, however, will differ as interest rates change and the underlying contracts settle.

Counterparty Credit Risk:

Interest rate swaps expose us to counterparty credit risk for non-performance. We manage our exposure to counterparty credit risk by only dealing with counterparties who are substantial international financial institutions with significant experience using such derivative instruments.