In the ordinary course of business, the Company is exposed to commodity price risks relating to the purchases of raw materials and supplies, interest rate risks relating to variable rate debt and foreign currency exchange rate risks. The Company utilizes derivative financial instruments, including (but not limited to) futures contracts, option contracts, forward contracts and swaps, to manage certain of these exposures by hedging when it is practical to do so. The Company does not hold or issue financial instruments for speculative or trading purposes.

•pay-fixed, receive-variable interest rate swaps maturing in December 2022 that require monthly settlements and have the effect of hedging forecasted interest payments on BellRing’s variable rate debt.

In the first quarter of fiscal 2020, contemporaneously with the repayment of its term loan, the Company changed the designation of one of its interest rate swap contracts from a cash flow hedge to a non-designated hedging instrument. In connection with the de-designation, the Company reclassified losses previously recorded in accumulated OCI of $7.2 to “Interest expense, net” in the Condensed Consolidated Statement of Operations for the nine months ended June 30, 2020.

As of April 1, 2020, the Company changed the designation of its interest rate swap contracts that are used as hedges of forecasted interest payments on BellRing’s variable rate debt from cash flow hedges to non-designated hedging instruments as the swaps were no longer effective (as defined by GAAP). In connection with the de-designation, the Company started reclassifying losses previously recorded in accumulated OCI to “Interest expense, net” in the Condensed Consolidated Statements of Operations on a straight-line basis over the term of BellRing’s variable rate debt. Mark-to-market adjustments related to these swaps will also be included in “Interest expense, net” in the Condensed Consolidated Statements of Operations. At June 30, 2020, the remaining net loss before taxes to be amortized was $10.0.

In the first quarter of fiscal 2019, the Company terminated $800.0 notional value of its interest rate swaps that were designated as hedging instruments. In connection with this termination, the Company received cash proceeds of $29.8, and reclassified previously recorded gains from accumulated OCI to “Interest expense, net” in the Condensed Consolidated Statement of Operations for the nine months ended June 30, 2019.

The Company terminated $448.7 and $214.2 notional value of its cross-currency swap contracts that were designated as hedging instruments during the second quarter of fiscal 2020 and the first quarter of fiscal 2019, respectively. In connection with these terminations, the Company received cash proceeds of $50.3 during the nine months ended June 30, 2020 and $26.2 during the nine months ended June 30, 2019, both of which were recorded to accumulated OCI. Reclassification of amounts recorded in accumulated OCI into earnings will only occur in the event United Kingdom-based operations are substantially liquidated.


	June 30, 2020		September 30, 2019
Not designated as hedging instruments under ASC Topic 815:
Commodity contracts	$	38.0	$	47.1
Energy contracts	88.7		39.8
Foreign exchange contracts - Forward contracts	1.7		—
Interest rate swaps	622.0		73.1
Interest rate swaps - Rate-lock swaps	1,717.8		1,531.0
Interest rate swaps - Options	433.3		—
Designated as hedging instruments under ASC Topic 815:
Foreign exchange contracts - Cross-currency swaps	—		448.7
Interest rate swaps	—		200.0

The following table presents the balance sheet location and fair value of the Company’s derivative instruments, along with the portion designated as hedging instruments under ASC Topic 815. The Company does not offset derivative assets and liabilities within the Condensed Consolidated Balance Sheets.


		Fair Value						Portion Designated as Hedging Instruments
	Balance Sheet Location	June 30, 2020		September 30, 2019		June 30, 2020		September 30, 2019
Asset Derivatives:
Commodity contracts	Prepaid expenses and other current assets	$	3.3	$	1.9	$	—	$	—
Energy contracts	Prepaid expenses and other current assets	0.5		0.7		—		—
Commodity contracts	Other assets	0.4		0.1		—		—
Energy contracts	Other assets	1.1		—		—		—
Foreign exchange contracts	Prepaid expenses and other current assets	—		1.3		—		1.3
Foreign exchange contracts	Other assets	—		19.2		—		19.2

Interest rate swaps	Other assets	11.4		—		—		—
		$	16.7	$	23.2	$	—	$	20.5

Liability Derivatives:
Commodity contracts	Other current liabilities	$	2.2	$	1.0	$	—	$	—
Energy contracts	Other current liabilities	10.5		1.5		—		—
Energy contracts	Other liabilities	4.9		0.1		—		—


Interest rate swaps	Other current liabilities	32.7		85.1		—		1.6
Interest rate swaps	Other liabilities	529.8		330.4		—		6.2
		$	580.1	$	418.1	$	—	$	7.8

The following tables present the effects of the Company’s derivative instruments on the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Comprehensive Income for the three months ended June 30, 2020 and 2019.


Derivatives Not Designated as Hedging Instruments	Statement of Operations Location	Loss (Gain) Recognized in Statement of Operations
				2020		2019
Commodity contracts	Cost of goods sold	$	0.8	$	(5.7)
Energy contracts	Cost of goods sold	(2.8)		2.6
Foreign exchange contracts	Selling, general and administrative expenses	0.1		—

Interest rate swaps	Interest expense, net	2.1		—
Interest rate swaps	Expense on swaps, net	29.2		86.2


Derivatives Designated as Hedging Instruments	Loss (Gain) Recognized in OCI including NCI									Loss (Gain) Reclassified from Accumulated OCI including NCI into Earnings (a)				Statement of Operations Location
			2020			2019			2020			2019

Interest rate swaps	$	—		$	4.6		$	0.6		$	(0.4)		Interest expense, net
Cross-currency swaps	—			(18.2)			—			—			Expense on swaps, net

(a)For the three months ended June 30, 2020, this amount includes the amortization of previously unrealized losses on interest rate swaps that were de-designated as hedging instruments as of April 1, 2020.

The following table presents the components of the Company’s net hedging losses (gains) on interest rate swaps, which are included in “Interest expense, net” and “Expense on swaps, net” in the Condensed Consolidated Statements of Operations.


Three Months Ended June 30,	Statement of Operations Location	Mark-to-Market Loss (a)		Cash Settlements Paid (Received), Net (b)		Net Loss Reclassified from Accumulated OCI including NCI (c)
	Interest expense, net	$	0.6	$	0.9	$	0.6
	Expense on swaps, net	3.0		26.2		—
2020	Total	$	3.6	$	27.1	$	0.6

	Interest expense, net	$	—	$	(0.4)	$	—
	Expense on swaps, net	86.1		0.1		—
2019	Total	$	86.1	$	(0.3)	$	—

(b)Includes cash settlements recognized in earnings related to interest rate swaps that were not designated as hedging instruments during the nine months ended June 30, 2020 or 2019. Additionally, includes cash settlements reclassified from accumulated OCI into earnings related to interest rate swaps that had been previously designated as hedging instruments during the three months ended June 30, 2020 or 2019.


Derivatives Not Designated as Hedging Instruments	Statement of Operations Location	Loss (Gain) Recognized in Statement of Operations
				2020		2019
Commodity contracts	Cost of goods sold	$	6.9	$	(2.7)
Energy contracts	Cost of goods sold	20.7		2.6


Interest rate swaps	Interest expense, net	2.1		—
Interest rate swaps	Expense on swaps, net	192.4		200.9


Derivatives Designated as Hedging Instruments	Loss (Gain) Recognized in OCI including NCI									Loss (Gain) Reclassified from Accumulated OCI including NCI into Earnings (a)				Statement of Operations Location
			2020			2019			2020			2019

Interest rate swaps	$	9.7		$	11.7		$	7.6		$	(30.9)		Interest expense, net
Cross-currency swaps	(32.2)			(37.8)			—			—			Expense on swaps, net

(a)For the nine months ended June 30, 2020, this amount includes the reclassification of previously unrealized losses on interest rate swaps that were de-designated as hedging instruments in the first quarter of fiscal 2020, as well as the amortization of previously unrealized losses on interest rate swaps that were de-designated as hedging instruments as of April 1, 2020.


Nine Months Ended June 30,	Statement of Operations Location	Mark-to-Market Loss (a)		Cash Settlements Paid (Received), Net (b)		Net Loss Reclassified from Accumulated OCI including NCI (c)
	Interest expense, net	$	0.6	$	0.7	$	7.8
	Expense on swaps, net	146.7		45.7		—
2020	Total	$	147.3	$	46.4	$	7.8

	Interest expense, net	$	—	$	(30.9)	$	—
	Expense on swaps, net	200.5		0.4		—
2019	Total	$	200.5	$	(30.5)	$	—

(c)Includes the reclassification of previously unrealized losses on interest rate swaps that were de-designated as hedging instruments, as well as the amortization of previously unrealized losses on interest rate swaps over the term of the related debt that were de-designated as hedging instruments.

Accumulated OCI, including amounts reported as NCI, included a $89.6 net gain on hedging instruments before taxes ($67.5 after taxes) at June 30, 2020, compared to a $59.5 net gain before taxes ($44.5 after taxes) at September 30, 2019. Approximately $2.3 of the net hedging losses reported in accumulated OCI at June 30, 2020 are expected to be reclassified into earnings within the next 12 months. Accumulated OCI included settlements of and previously unrealized gains on cross-currency swaps of $99.5 and $36.5 at June 30, 2020 and September 30, 2019, respectively. In connection with the settlements and terminations of cross-currency swaps, the Company recognized gains in accumulated OCI of $63.0 during the nine months ended June 30, 2020 and $0.9 and $30.5 during the three and nine months ended June 30, 2019, respectively. Reclassification of amounts recorded in accumulated OCI into earnings will only occur in the event United Kingdom-based operations are substantially liquidated.