Derivative Instruments

4 Months Ended

Jan. 22, 2012

Derivative Instruments [Abstract]

Derivative Instruments

4. DERIVATIVE INSTRUMENTS

Objectives and strategies — We are exposed to interest rate volatility with regard to our variable rate debt. To reduce our exposure to rising interest rates, in August 2010, we entered into two interest rate swap agreements that effectively convert $100.0 million of our variable rate term loan borrowings to a fixed-rate basis from September 2011 through September 2014.

Financial position — The following derivative instruments were outstanding as of the end of each period (in thousands):

	January 22, 2012					October 2, 2011
	Balance Sheet Location		Fair Value			Balance Sheet Location		Fair Value
Derivatives designated as hedging instruments:
Interest rate swaps (Note 3)		Accrued liabilities	$	(2,689	)		Accrued liabilities	$	(2,682	)
Total derivatives			$	(2,689	)			$	(2,682	)

Financial performance — The following is a summary of the gains or losses recognized on our interest rate swap derivative instruments (in thousands):

	Location of Loss in Income	Sixteen Weeks Ended
		January 22,			January 23,
		2012			2011
Gain/(loss) recognized in OCI (Note 9)	N/A	$	(405	)	$	1,437
Gain/(loss) reclassified from accumulated OCI into income (Note 9)	Interest expense, net	$	(398	)	$	—

Amounts reclassified from accumulated other comprehensive income ("OCI") into interest expense represent payments made to the counterparty for the effective portions of the interest rate swaps that were recognized in accumulated other comprehensive income (loss) and reclassified into earnings as an increase to interest expense. During the periods presented, our interest rate swaps had no hedge ineffectiveness.