Accumulated Other Comprehensive Loss

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Accumulated Other Comprehensive Loss

NOTE 14 – Accumulated Other Comprehensive Loss

Shareholders’ equity includes certain items classified as accumulated other comprehensive loss (“AOCI”) in the Condensed Consolidated Balance Sheets, including:

•Unrealized gains (losses) on hedges relate to interest rate swaps to convert a portion of our Revolving Credit Facility's outstanding balance from a variable rate of interest into a fixed rate, foreign currency forward contracts used to hedge our exposure to changes in exchange rates affecting certain revenues and costs denominated in foreign currencies, as well as a cross-currency swap that synthetically converts our U.S. Dollar variable rate debt to Krone-denominated variable rate debt. These hedges are designated as cash flow hedges, and we have deferred income statement recognition of gains and losses until the hedged transactions occur, at which time amounts are reclassified into earnings. Further information related to our derivative financial instruments is included in Note 13 - Derivative Financial Instruments and Note 17 – Fair Value Measurements.

•Unrealized gains (losses) on pension obligations are deferred from income statement recognition until the gains or losses are realized. Amounts reclassified to income from AOCI are included in net periodic pension income (expense). Further information related to our pension obligations is included in Note 7 – Retirement Plans.

•Cumulative translation adjustments relate to our non-U.S. subsidiary companies that have designated a functional currency other than the U.S. Dollar. We are required to translate the subsidiary functional currency financial statements to

dollars using a combination of historical, period-end, and average foreign exchange rates. This combination of rates creates the foreign currency translation adjustment component of other comprehensive (loss) income.

Changes in exchange rates between the functional currency and the currency in which a transaction is denominated are foreign exchange transaction gains or losses. Transaction losses for the three months ended March 31, 2023 and March 31, 2022 were $68 and $288, respectively. The impact of these changes have been included in other income (expense) in the Condensed Consolidated Statements of Earnings.

The components of accumulated other comprehensive loss for the three months ended March 31, 2023, are as follows:

							(Gain) Loss
	As of			Gain (Loss)			Reclassified			As of
	December 31,			Recognized			from AOCI			March 31,
	2022			in OCI			to Earnings			2023
Changes in fair market value of derivatives:
Gross	$	3,911		$	1,090		$	(598	)	$	4,403
Income tax benefit (expense)		(899	)		(251	)		138			(1,012	)
Net		3,012			839			(460	)		3,391
Changes in unrealized pension cost:
Gross		(1,179	)		—			(47	)		(1,226	)
Income tax benefit		376			—			13			389
Net		(803	)		—			(34	)		(837	)
Cumulative translation adjustment:
Gross		(2,880	)		1,024			—			(1,856	)
Income tax benefit (expense)		—			—			—			—
Net		(2,880	)		1,024			—			(1,856	)
Total accumulated other comprehensive (loss) income	$	(671	)	$	1,863		$	(494	)	$	698

The components of accumulated other comprehensive loss for the three months ended March 31, 2022, are as follows:

							(Gain) Loss
	As of			Gain (Loss)			Reclassified			As of
	December 31,			Recognized			from AOCI			March 31,
	2021			in OCI			to Earnings			2022
Changes in fair market value of derivatives:
Gross	$	(634	)	$	1,577		$	26		$	969
Income tax benefit (expense)		147			(363	)		(5	)		(221	)
Net		(487	)		1,214			21			748
Changes in unrealized pension cost:
Gross		(2,744	)		—			120			(2,624	)
Income tax benefit (expense)		738			—			(26	)		712
Net		(2,006	)		—			94			(1,912	)
Cumulative translation adjustment:
Gross		(2,032	)		(249	)		—			(2,281	)
Income tax benefit (expense)		—			—			—			—
Net		(2,032	)		(249	)		—			(2,281	)
Total accumulated other comprehensive (loss) income	$	(4,525	)	$	965		$	115		$	(3,445	)