Accumulated Other Comprehensive Income (Loss)

9 Months Ended

Sep. 30, 2017

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss)

6.    Accumulated Other Comprehensive Income (Loss)

The following table presents the components of comprehensive income (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Net income	$	5,667	$	6,081	$	15,565	$	13,834
Mark to market of foreign exchange hedges		92		—		532		—
Deferred income tax expense		(34)		—		(195)		—
Comprehensive income	$	5,725	$	6,081	$	15,902	$	13,834

In November 2016, to hedge against potential losses due to changes in the Euro to U.S. Dollar exchange rates, the Company entered into foreign exchange (“FX”) hedges with Wells Fargo Bank, N.A. as the counterparty to the FX hedges to fix the exchange rate for 5.5 million Euros in connection with a contractual obligation related to the St. Clair kiln project.  The Company will be exposed to credit losses in the event of non-performance by the counterparty to the FX hedges.  The FX hedges have been effective as defined under applicable accounting rules.  Therefore, changes in fair value of the FX hedges are reflected in comprehensive income.  Due to the weakening of the U.S. Dollar, compared to the Euro, in the 2017 periods, the change in the fair value of the remaining 3.7 million Euro FX hedges resulted in an asset of $181 thousand at September 30, 2017, which is included in prepaid expenses and other current assets ($142 thousand) and other assets, net ($39 thousand) at September 30, 2017.  Due to the strengthening of the U.S. Dollar, compared to the Euro, in the period from when the Company entered into the FX hedges through December 31, 2016, the fair value of the FX hedges resulted in a liability of $352 thousand at December 31, 2016, which is included in accrued expenses ($309 thousand) and other liabilities ($43 thousand) at December 31, 2016.