Derivative Instruments, Hedging Activities and Fair Value (Tables)

3 Months Ended

Mar. 31, 2013

Derivative Instruments, Hedging Activities And Fair Value

Schedule of fair value of outstanding derivative contracts

The fair values of outstanding derivative contracts recorded as assets and liabilities on the Condensed Consolidated Balance Sheets at March 31, 2013 and December 31, 2012 were as follows:

	Asset Derivatives (a)			Liability Derivatives (a)
(In thousands)	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
March 31, 2013
Derivatives designated as hedging instruments:
Cross currency interest rate swaps	Other current assets	$	195	Other current liabilities	$	—
Cross currency interest rate swaps	Other assets	47,752		Other liabilities	199
Total derivatives designated as hedging instruments		$	47,947		$	199
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Other current assets	$	2,200	Other current liabilities	$	3,671

	Asset Derivatives (a)			Liability Derivatives (a)
(In thousands)	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
December 31, 2012
Derivatives designated as hedging instruments:
Cross currency interest rate swaps	Other assets	$	39,058	Other liabilities	$	14,346
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Other current assets	$	853	Other current liabilities	$	1,775

(a) All of the Company's derivatives are recorded in the Condensed Consolidated Balance Sheets as gross amounts and not offset. All of the Company's cross currency interest rate swaps and certain foreign currency forward exchange contracts are transacted under International Swaps and Derivatives Association ("ISDA") documentation. Each ISDA master agreement permits the net settlement of amounts owed in the event of default. The Company's derivative assets and liabilities subject to enforceable master netting arrangements total $0.2 million at March 31, 2013 and $0.1 million at December 31, 2012.

Schedule of effect of derivative instruments

The effect of derivative instruments on the Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Comprehensive Income for the three months endedMarch 31, 2013 and 2012 was as follows:

Derivatives Designated as Hedging Instruments

(In thousands)	Amount of  Gain (Loss) Recognized in Other Comprehensive Income  (“OCI”)  on Derivative - Effective  Portion			Location of Gain (Loss) Reclassified from Accumulated OCI into Income - Effective Portion	Amount of Gain (Loss) Reclassified  from Accumulated OCI into  Income - Effective  Portion			Location of Gain (Loss) Recognized  in Income on  Derivative - Ineffective Portion and Amount Excluded from Effectiveness Testing	Amount of  Gain (Loss)  Recognized  in Income  on Derivative - Ineffective  Portion and  Amount Excluded from Effectiveness  Testing
Three Months Ended March 31, 2013:
Foreign currency forward exchange contracts	$	5		Cost of services and products sold	$	(6	)		$	—
Cross-currency interest rate swaps	2,493				—			Cost of services and products sold	20,453			(a)
	$	2,498			$	(6	)		$	20,453
Three Months Ended March 31, 2012:
Foreign currency forward exchange contracts	$	(362	)	Cost of services and products sold	$	34			$	—
Cross-currency interest rate swaps	1,339				—			Cost of services and products sold	(11,247		)	(a)
	$	977			$	34			$	(11,247	)

(a)  These gains (losses) offset foreign currency fluctuation effects on the debt principal.

Derivatives Not Designated as Hedging Instruments

	Location of Gain (Loss) Recognized in Income on Derivative	Amount of Gain (Loss) Recognized in Income on Derivative for the Three Months Ended March 31 (a)
(In thousands)		2013		2012
Foreign currency forward exchange contracts	Cost of services and products sold	$	2,059	$	(4,694	)

(a)  These gains (losses) offset amounts recognized in cost of services and products sold principally as a result of intercompany or third party foreign currency exposures.

Summary of foreign currency forward exchange contracts, by major currency

The following tables summarize, by major currency, the contractual amounts of the Company’s foreign currency forward exchange contracts in U.S. dollars at March 31, 2013 and December 31, 2012.  The “Buy” amounts represent the U.S. dollar equivalent of commitments to purchase foreign currencies, and the “Sell” amounts represent the U.S. dollar equivalent of commitments to sell foreign currencies.  The recognized gains and losses offset amounts recognized in cost of services and products sold principally as a result of intercompany or third party foreign currency exposures.

Contracted Amounts of Foreign Currency Forward Exchange Contracts Outstanding at March 31, 2013:

(In thousands)	Type	U.S. Dollar Equivalent		Maturity	Recognized Gain (Loss)
British pounds sterling	Sell	$	3,079	April 2013	$	(4	)
British pounds sterling	Buy	7,092		April 2013 through May 2013	11
Euros	Sell	203,335		April 2013 through June 2013	1,698
Euros	Buy	129,970		April 2013 through May 2013	(3,208		)
Other currencies	Sell	2,947		April 2013 through May 2013	(9		)
Other currencies	Buy	53,456		April 2013 through May 2013	41
Total		$	399,879		$	(1,471	)

Contracted Amounts of Foreign Currency Forward Exchange Contracts Outstanding at December 31, 2012:

(In thousands)	Type	U.S. Dollar Equivalent		Maturity	Recognized Gain (Loss)
British pounds sterling	Sell	$	—		$	—
British pounds sterling	Buy	6,141		January 2013 through February 2013	58
Euros	Sell	264,234		January 2013 through March 2013	(1,082		)
Euros	Buy	116,618		January 2013 through February 2013	187
Other currencies	Sell	2,811		January 2013 through March 2013	(15		)
Other currencies	Buy	44,291		January 2013	(71		)
Total		$	434,095		$	(923	)

Summary of notional amount of cross-currency interest rate swaps

The following table indicates the contractual amounts of the Company's cross-currency interest rate swaps at March 31, 2013:

			Interest Rates
(In millions)	Contractual Amount		Receive	Pay
Maturing 2018	$	250.0	Fixed U.S. dollar rate	Fixed euro rate
Maturing 2020	220.0		Fixed U.S. dollar rate	Fixed British pound sterling rate
Maturing 2013 through 2017	10.8		Floating U.S. dollar rate	Fixed rupee rate

Schedule of fair value of financial instruments

The following table indicates the fair value hierarchy of the financial instruments of the Company at March 31, 2013 and December 31, 2012:

Level 2 Fair Value Measurements

(In thousands)	March 31 2013		December 31 2012
Assets
Foreign currency forward exchange contracts	$	2,200	$	853
Cross-currency interest rate swaps	47,947		39,058
Liabilities
Foreign currency forward exchange contracts	3,671		1,775
Cross-currency interest rate swaps	199		14,346