Other Comprehensive Earnings (Loss)

9 Months Ended

Sep. 25, 2022

Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract]

Components of other comprehensive earnings (loss) are presented within the consolidated statements of comprehensive earnings. The following table presents the related tax effects on changes in other comprehensive earnings (loss) for the quarters and nine months ended September 25, 2022 and September 26, 2021.


	Quarter Ended			Nine months ended
	September 25, 2022		September 26, 2021	September 25, 2022		September 26, 2021

Other comprehensive earnings (loss), tax effect:
Tax expense on unrealized holding gains	$	—	0.1	$	0.1	—
Tax expense on cash flow hedging activities	(1.7)		(0.3)	(2.1)		(0.7)


Reclassifications to earnings, tax effect:
Tax expense (benefit) on cash flow hedging activities	0.6		(0.3)	0.5		(0.3)

Amortization of unrecognized pension and postretirement amounts	—		(0.1)	(0.1)		(0.2)

Total tax effect on other comprehensive loss	$	(1.1)	(0.6)	$	(1.6)	(1.2)

Changes in the components of accumulated other comprehensive earnings (loss), net of tax for the nine months ended September 25, 2022 and September 26, 2021 are as follows:


	Pension and Postretirement Amounts		Gains (Losses) on Derivative Instruments	Unrealized Holding Gains (Losses) on Available- for-Sale Securities	Foreign Currency Translation Adjustments	Total Accumulated Other Comprehensive Loss
2022
Balance at December 26, 2021	$	(35.1)	(6.0)	0.2	(194.4)	(235.3)
Current period other comprehensive earnings (loss)	0.3		13.4	(0.3)	(103.0)	(89.6)
Balance at September 25, 2022	$	(34.8)	7.4	(0.1)	(297.4)	(324.9)

2021
Balance at December 27, 2020	$	(40.7)	(22.1)	0.3	(132.5)	(195.0)

Current period other comprehensive earnings (loss)	0.6		9.5	(0.1)	(23.6)	(13.6)
Balance at September 26, 2021	$	(40.1)	(12.6)	0.2	(156.1)	(208.6)

Gains (Losses) on Derivative Instruments

At September 25, 2022, the Company had remaining net deferred gains on foreign currency forward contracts, net of tax, of $22.4 million in accumulated other comprehensive earnings (loss) ("AOCE"). These instruments hedge payments related to inventory purchased in the third quarter of 2022 or forecasted to be purchased during the remainder of 2022 through 2023, intercompany expenses expected to be paid or received during 2022, television and movie production costs paid in 2022 or expected to be paid in 2023 or 2024, and cash receipts for sales made at the end of the third quarter of 2022 or forecasted to be made in the remainder of 2022. These amounts will be reclassified into the consolidated statements of operations upon the sale of the related inventory, the recognition of the related production costs or the recognition of the related sales or intercompany expenses to be paid or received.

In addition to foreign currency forward contracts, the Company entered into hedging contracts on future interest payments related to the 3.15% Notes that were repaid in full in the aggregate principal amount of $300.0 million during the first quarter of 2021 (See note 7), and the 5.10% Notes due 2044. At the date of debt issuance, these contracts were terminated and the fair value on the date of settlement was deferred in AOCE and is being amortized to interest expense over the life of the related notes using the effective interest rate method. At September 25, 2022, deferred losses, net of tax of $15.0 million related to these instruments remained in AOCE. For each of the quarters ended September 25, 2022 and September 26, 2021, previously deferred losses of $0.2 million related to these instruments were reclassified from AOCE to net earnings. For the nine-month periods ended September 25, 2022 and September 26, 2021, previously deferred losses of $0.5 million and $1.0 million, respectively, related to these instruments were reclassified from AOCE to net earnings.

Of the net deferred gains included in AOCE at September 25, 2022, the Company expects net gains of approximately $22.4 million to be reclassified to the consolidated statements of operations within the next 12 months. However, the amount ultimately realized in earnings is dependent on the fair value of the hedging instruments on the settlement dates.

See note 11 for additional discussion on reclassifications from AOCE to earnings.