XML 39 R14.htm IDEA: XBRL DOCUMENT v3.19.2
Derivative Instruments and Hedging Activities
 6 Months Ended
Jun. 30, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
For further information on the Company’s derivative and hedge accounting policies, see Note 1—General and Summary of Significant Accounting Policies—Derivatives and Hedging Activities of Item 8.—Financial Statements and Supplementary Data in the 2018 Form 10-K.
Volume of Activity — The following tables present the Company’s maximum notional (in millions) over the remaining contractual period by type of derivative as of June 30, 2019, regardless of whether they are in qualifying cash flow hedging relationships, and the dates through which the maturities for each type of derivative range:
Interest Rate and Foreign Currency Derivatives
 
Maximum Notional Translated to USD
 
Latest Maturity
Interest rate (LIBOR and EURIBOR)
 
$
6,174

 
2044
Cross-currency swaps (Chilean Unidad de Fomento and Chilean peso)
 
304

 
2029
Foreign Currency:
 
 
 
 
Argentine peso
 
49

 
2026
Chilean peso
 
223

 
2022
Colombian peso
 
223

 
2022
Brazilian real
 
17

 
2019
Others, primarily with weighted average remaining maturities of a year or less
 
216

 
2021
Commodity Derivatives
 
Maximum Notional
 
Latest Maturity
Natural Gas (in MMBtu)
 
57

 
2020
Power (in MWhs)
 
10

 
2020
Coal (in Tons or Metric Tons)
 
10

 
2027
Fuel Oil (in BBL)
 
1

 
2020

Accounting and Reporting — Assets and Liabilities — The following tables present the fair value of assets and liabilities related to the Company’s derivative instruments as of June 30, 2019 and December 31, 2018 (in millions):
Fair Value
June 30, 2019
 
December 31, 2018
Assets
Designated
 
Not Designated
 
Total
 
Designated
 
Not Designated
 
Total
Interest rate derivatives
$
—

 
$
—

 
$
—

 
$
29

 
$
—

 
$
29

Cross-currency derivatives
11

 
—

 
11

 
6

 
—

 
6

Foreign currency derivatives
—

 
213

 
213

 
—

 
217

 
217

Commodity derivatives
—

 
28

 
28

 
—

 
10

 
10

Total assets
$
11

 
$
241

 
$
252

 
$
35

 
$
227

 
$
262

Liabilities
 
 
 
 
 
 
 
 
 
 
 
Interest rate derivatives
$
393

 
$
9

 
$
402

 
$
205

 
$
3

 
$
208

Cross-currency derivatives
3

 
—

 
3

 
5

 
—

 
5

Foreign currency derivatives
11

 
18

 
29

 
28

 
13

 
41

Commodity derivatives
2

 
22

 
24

 
—

 
3

 
3

Total liabilities
$
409

 
$
49

 
$
458

 
$
238

 
$
19

 
$
257

 
June 30, 2019
 
December 31, 2018
Fair Value
Assets
 
Liabilities
 
Assets
 
Liabilities
Current
$
53

 
$
80

 
$
75

 
$
51

Noncurrent
199

 
378

 
187

 
206

Total
$
252

 
$
458

 
$
262

 
$
257


As of June 30, 2019 and December 31, 2018, all derivative instruments subject to credit risk-related contingent features were in an asset position.
Earnings and Other Comprehensive Income (Loss) — The following table presents the pre-tax gains (losses) recognized in AOCL and earnings related to all derivative instruments for the periods indicated (in millions):
 
Three Months Ended June 30,
 
Six Months Ended June 30,
2019
 
2018
 
2019
 
2018
Cash flow hedges
 
 
 
 
 
 
 
Gains (losses) recognized in AOCL
 
 
 
 
 
 
 
Interest rate derivatives
$
(170
)
 
$
8

 
$
(264
)
 
$
55

Cross-currency derivatives
4

 
(24
)
 
9

 
(5
)
Foreign currency derivatives
3

 
(39
)
 
6

 
(33
)
Commodity derivatives
(1
)
 
—

 
(1
)
 
—

Total
$
(164
)
 
$
(55
)
 
$
(250
)
 
$
17

Gains (losses) reclassified from AOCL into earnings
 
 
 
 
 
 
 
Interest rate derivatives
$
(9
)
 
$
(14
)
 
$
(17
)
 
$
(30
)
Cross-currency derivatives
(1
)
 
(28
)
 
6

 
(18
)
Foreign currency derivatives
—

 
(2
)
 
(11
)
 
(1
)
Commodity derivatives
—

 
(1
)
 
—

 
(5
)
Total
$
(10
)
 
$
(45
)
 
$
(22
)

$
(54
)
Loss reclassified from AOCL to earnings due to discontinuance of hedge accounting (1)
$
2

 
$
—

 
$
2

 
$
—

Gains (losses) recognized in earnings related to
 
 
 
 
 
 
 
Ineffective portion of cash flow hedges
$
—

 
$
(3
)
 
$
—

 
$
(3
)
Not designated as hedging instruments:
 
 
 
 
 
 
 
Interest rate derivatives
(2
)
 
—

 
$
(4
)
 
$
—

Foreign currency derivatives
11

 
46

 
6

 
154

Commodity derivatives and other
2

 
22

 
4

 
31

Total
$
11

 
$
68

 
$
6

 
$
185


_____________________________
(1)
Cash flow hedge was discontinued on a cross-currency swap because the underlying debt was prepaid.
AOCL is expected to decrease pre-tax income from continuing operations for the twelve months ended June 30, 2020 by $66 million, primarily due to interest rate derivatives.