Quarterly report pursuant to Section 13 or 15(d)

Derivative Financial Instruments and Hedging Activities (Tables)

v3.8.0.1
Derivative Financial Instruments and Hedging Activities (Tables)
9 Months Ended
Sep. 30, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Outstanding Derivatives on Individual Contract Basis
The following table presents outstanding derivatives on an individual contract basis:
 
Fair Value of Derivatives
with Unrealized Gains
 
Fair Value of Derivatives
with Unrealized Losses
In thousands
September 2017
 
December 2016
 
September 2016
 
September 2017
 
December 2016
 
September 2016
Foreign currency exchange contracts designated as hedging instruments
$
26,451

 
$
103,340

 
$
75,497

 
$
(88,593
)
 
$
(25,292
)
 
$
(31,996
)
Foreign currency exchange contracts not designated as hedging instruments
207

 

 

 
(619
)
 
(282
)
 
(185
)
Total derivatives
$
26,658

 
$
103,340

 
$
75,497

 
$
(89,212
)
 
$
(25,574
)
 
$
(32,181
)
Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from Current Gross
VF records and presents the fair values of all of its derivative assets and liabilities in the Consolidated Balance Sheets on a gross basis, even though they are subject to master netting agreements. If VF were to offset and record the asset and liability balances of its forward foreign currency exchange contracts on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Consolidated Balance Sheets would be adjusted from the current gross presentation to the net amounts as detailed in the following table:
 
September 2017
 
December 2016
 
September 2016
In thousands
Derivative
Asset
 
Derivative
Liability
 
Derivative
Asset
 
Derivative
Liability
 
Derivative
Asset
 
Derivative
Liability
Gross amounts presented in the Consolidated Balance Sheets
$
26,658

 
$
(89,212
)
 
$
103,340

 
$
(25,574
)
 
$
75,497

 
$
(32,181
)
Gross amounts not offset in the Consolidated Balance Sheets
(26,001
)
 
26,001

 
(22,341
)
 
22,341

 
(19,328
)
 
19,328

Net amounts
$
657

 
$
(63,211
)
 
$
80,999

 
$
(3,233
)
 
$
56,169

 
$
(12,853
)
Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from Current Gross
VF records and presents the fair values of all of its derivative assets and liabilities in the Consolidated Balance Sheets on a gross basis, even though they are subject to master netting agreements. If VF were to offset and record the asset and liability balances of its forward foreign currency exchange contracts on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Consolidated Balance Sheets would be adjusted from the current gross presentation to the net amounts as detailed in the following table:
 
September 2017
 
December 2016
 
September 2016
In thousands
Derivative
Asset
 
Derivative
Liability
 
Derivative
Asset
 
Derivative
Liability
 
Derivative
Asset
 
Derivative
Liability
Gross amounts presented in the Consolidated Balance Sheets
$
26,658

 
$
(89,212
)
 
$
103,340

 
$
(25,574
)
 
$
75,497

 
$
(32,181
)
Gross amounts not offset in the Consolidated Balance Sheets
(26,001
)
 
26,001

 
(22,341
)
 
22,341

 
(19,328
)
 
19,328

Net amounts
$
657

 
$
(63,211
)
 
$
80,999

 
$
(3,233
)
 
$
56,169

 
$
(12,853
)
Derivatives Classified as Current or Noncurrent Based on Maturity Dates
Derivatives are classified as current or noncurrent based on maturity dates, as follows:
In thousands
September 2017
 
December 2016
 
September 2016
Other current assets
$
23,387

 
$
84,519

 
$
66,231

Accrued liabilities
(75,266
)
 
(18,574
)
 
(28,852
)
Other assets
3,271

 
18,821

 
9,266

Other liabilities
(13,946
)
 
(7,000
)
 
(3,329
)
Effects of Cash Flow Hedging included in Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
The effects of cash flow hedging included in VF’s Consolidated Statements of Income and Consolidated Statements of Comprehensive Income are summarized as follows:
In thousands
Gain (Loss) on Derivatives
Recognized in OCI
Three Months Ended September
 
Gain (Loss) on Derivatives
Recognized in OCI
Nine Months Ended September
Cash Flow Hedging Relationships
2017
 
2016
 
2017
 
2016
Foreign currency exchange
$
(51,147
)
 
$
9,571

 
$
(117,580
)
 
$
32,837

In thousands
Gain (Loss) Reclassified from
Accumulated OCI into Income
Three Months Ended September
 
Gain (Loss) Reclassified from
Accumulated OCI into Income
Nine Months Ended September
Location of Gain (Loss)
2017
 
2016
 
2017
 
2016
Net sales
$
11,614

 
$
14,676

 
$
25,074

 
$
11,997

Cost of goods sold
(4,164
)
 
15,485

 
12,763

 
80,094

Selling, general and administrative expenses
(882
)
 
(1,098
)
 
(1,212
)
 
(3,611
)
Other income (expense), net
(774
)
 
526

 
(688
)
 
2,653

Interest expense
(1,185
)
 
(1,131
)
 
(3,518
)
 
(3,356
)
Total
$
4,609

 
$
28,458

 
$
32,419

 
$
87,777

Effects of Fair Value Hedging Included in Consolidated Statements of Income
Following is a summary of these derivatives included in VF’s Consolidated Statements of Income:
In thousands
Derivatives Not Designated as Hedges
 
Location of Gain (Loss)
on Derivatives
Recognized in Income
 
Gain (Loss) on Derivatives
Recognized in Income
Three Months Ended September
 
Gain (Loss) on Derivatives
Recognized in Income
Nine Months Ended September
2017
 
2016
 
2017
 
2016
Foreign currency exchange
 
Cost of goods sold
 
$
(927
)
 
$
(510
)
 
$
(294
)
 
$
225

Foreign currency exchange
 
Other income (expense), net
 
(339
)
 
(110
)
 
(2,078
)
 
(1,196
)
Total
 
 
 
$
(1,266
)
 
$
(620
)
 
$
(2,372
)
 
$
(971
)