Financial instruments and fair value (Tables)

6 Months Ended

Aug. 02, 2014

Fair Value and Presentation of Derivative Instruments in Condensed Consolidated Balance Sheets

The following table summarizes the fair value and presentation of derivative instruments in the condensed consolidated balance sheets:

	Derivative assets
			Fair value
(in millions)	Balance sheet location		August 2, 2014			February 1, 2014			August 3, 2013
Derivatives designated as hedging instruments:
Foreign currency contracts		Other current assets	$	—		$	—		$	1.5
Foreign currency contracts		Other assets		—			—			0.1
Commodity contracts		Other current assets		0.7			0.8			—
Commodity contracts		Other assets		—			—			—
			$	0.7		$	0.8		$	1.6
Derivatives not designated as hedging instruments:
Foreign currency contracts		Other current assets		0.3			0.2			0.1
Total derivative assets			$	1.0		$	1.0		$	1.7
	Derivative liabilities
			Fair value
(in millions)	Balance sheet location		August 2, 2014			February 1, 2014			August 3, 2013
Derivatives designated as hedging instruments:
Foreign currency contracts		Other current liabilities	$	(1.9	)	$	(2.1	)	$	—
Foreign currency contracts		Other liabilities		—			—			—
Commodity contracts		Other current liabilities		(0.1	)		(0.8	)		—
Commodity contracts		Other liabilities		—			—			—
			$	(2.0	)	$	(2.9	)	$	—
Derivatives not designated as hedging instruments:
Foreign currency contracts		Other current liabilities		—			—			—
Total derivative liabilities			$	(2.0	)	$	(2.9	)	$	—

Summary of Pre-Tax Gains (Losses) Recorded In Accumulated OCI for Derivatives

The following table summarizes the pre-tax gains (losses) recorded in accumulated OCI for derivatives designated in cash flow hedging relationships:

(in millions)	August 2, 2014			February 1, 2014			August 3, 2013
Foreign currency contracts	$	(3.2	)	$	(2.3	)	$	2.3
Commodity contracts		(4.9	)(1)		(18.8	)(1)		(28.6	)(1)
Total	$	(8.1	)	$	(21.1	)	$	(26.3	)

(1) As of August 2, 2014, losses recorded in accumulated OCI include $6.2 million related to commodity contracts terminated prior to contract maturity in Fiscal 2014 (February 1, 2014 and August 3, 2013: $18.2 million and $27.7 million, respectively).

Fair Value of Financial Instruments Held Or Issued

The methods Signet uses to determine fair value on an instrument-specific basis are detailed below:

	August 2, 2014								February 1, 2014								August 3, 2013
(in millions)	Carrying Value			Quoted market prices for identical assets (Level 1)		Significant other observable inputs (Level 2)			Carrying Value			Quoted market prices for identical assets (Level 1)		Significant other observable inputs (Level 2)			Carrying Value		Quoted market prices for identical assets (Level 1)		Significant other observable inputs (Level 2)
Assets:
US Treasury securities	$	9.9		$	9.9	$	—		$	—		$	—	$	—		$	—	$	—	$	—
Corporate equity securities		2.5			2.5		—			—			—		—			—		—		—
Foreign currency contracts		0.3			—		0.3			0.2			—		0.2			1.7		—		1.7
Commodity contracts		0.7			—		0.7			0.8			—		0.8			—		—		—
US government agency securities		1.3			—		1.3			—			—		—			—		—		—
Corporate bonds and notes		8.6			—		8.6			—			—		—			—		—		—
Liabilities:
Foreign currency contracts		(1.9	)		—		(1.9	)		(2.1	)		—		(2.1	)		—		—		—
Commodity contracts		(0.1	)		—		(0.1	)		(0.8	)		—		(0.8	)		—		—		—

Carrying Amount and Fair Value of Outstanding Debt

The carrying amount and fair value of outstanding debt at August 2, 2014 were as follows:

	August 2, 2014				February 1, 2014				August 3, 2013
(in millions)	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value
Outstanding debt(1):
Senior notes (Level 1)	$	398.4	$	400.0	$	—	$	—	$	—	$	—
Securitization facility (Level 2)		600.0		600.0		—		—		—		—
Term loan (Level 2)		400.0		400.0
Capital lease obligations (Level 2)		1.8		1.8		—		—		—		—
Total outstanding debt	$	1,400.2	$	1,401.8	$	—	$	—	$	—	$	—

(1) See Note 19 – Loans, overdrafts and long-term debt for classification between current and long-term debt.

Cash Flow Hedging

Effect of Derivative Instruments on Condensed Consolidated Income Statements

The following tables summarize the effect of derivative instruments designated as cash flow hedges in OCI and the condensed consolidated income statements:

Foreign currency contracts

			13 weeks ended						26 weeks ended
(in millions)	Income statement caption		August 2, 2014			August 3, 2013			August 2, 2014			August 3, 2013
(Losses) gains recorded in accumulated OCI, beginning of period			$	(3.6	)	$	1.6		$	(2.3	)	$	1.3
Current period gains (losses) recognized in OCI				0.1			0.9			(1.2	)		1.4
Losses (gains) reclassified from accumulated OCI to net income		Cost of sales		0.3			(0.2	)		0.3			(0.4	)
(Losses) gains recorded in accumulated OCI, end of period			$	(3.2	)	$	2.3		$	(3.2	)	$	2.3

Commodity contracts

			13 weeks ended						26 weeks ended
(in millions)	Income statement caption		August 2, 2014			August 3, 2013			August 2, 2014			August 3, 2013
(Losses) gains recorded in accumulated OCI, beginning of period			$	(9.4	)	$	(19.3	)	$	(18.8	)	$	(0.5	)
Current period (losses) gains recognized in OCI				(0.3	)		(9.5	)		1.7			(27.5	)
Losses (gains) reclassified from accumulated OCI to net income		Cost of sales		4.8			0.2			12.2			(0.6	)
(Losses) gains recorded in accumulated OCI, end of period			$	(4.9	)	$	(28.6	)	$	(4.9	)	$	(28.6	)

Not Designated as Hedging Instrument

Effect of Derivative Instruments on Condensed Consolidated Income Statements

The following table presents the effects of the Company’s derivatives instruments not designated as cash flow hedges in the condensed consolidated income statements:

			13 weeks ended				26 weeks ended
(in millions)	Income statement caption		August 2, 2014		August 3, 2013		August 2, 2014			August 3, 2013
Derivatives not designated as hedging instruments:
Foreign currency contracts		Other operating income, net	$	—	$	3.0	$	(1.6	)	$	2.8
Total			$	—	$	3.0	$	(1.6	)	$	2.8