Orbitz 2014 Annual Report Download - page 80

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ORBITZ WORLDWIDE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
80
Foreign Currency Hedges
We enter into foreign currency contracts to manage our exposure to changes in the foreign currency associated with
foreign currency receivables, payables and intercompany transactions. We primarily hedge our foreign currency exposure to the
Pound sterling, Euro, Swiss Franc and the Australian dollar. As of December 31, 2014, we had foreign currency contracts
outstanding with a total net notional amount of $190.3 million, all of which subsequently matured in early 2015. The foreign
currency contracts do not qualify for hedge accounting treatment; accordingly, changes in the fair value of the foreign currency
contracts are reflected in net income as a component of Selling, general and administrative expense in our Consolidated
Statements of Operations.
The following table shows the fair value of our foreign currency hedges:
Fair Value Measurements as of
Balance Sheet Location December 31, 2014 December 31, 2013
(in thousands)
Asset Derivatives:
Foreign currency hedges . . . . . . . . . . . . . . . . . . . . . . Other current assets $ 4,275 $ —
Liability Derivatives:
Foreign currency hedges . . . . . . . . . . . . . . . . . . . . . . Other current liabilities $ — $ 1,412
The following table shows the changes in the fair value of our foreign currency contracts which were recorded as a gain/
(loss) in Selling, general and administrative expense:
Years Ended December 31,
2014 2013 2012
(in thousands)
Foreign currency hedges (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,813 $ 3,877 $ (11,385)
(a) We recorded transaction gains/(losses) associated with the re-measurement and settlement of our foreign denominated
assets and liabilities of $(12.9) million, $(9.3) million and $6.7 million for the years ended December 31, 2014, 2013
and 2012, respectively. These transaction gains and losses were included in Selling, general and administrative
expense in our Consolidated Statements of Operations. The net impact of these transaction gains and losses, together
with the gains/(losses) incurred on our foreign currency hedges, were losses of $6.1 million, $5.4 million and $4.7
million for the years ended December 31, 2014, 2013 and 2012, respectively.
The tables below show the gross and net information related to derivatives eligible for offset in the Consolidated
Balance Sheets as of December 31, 2014 and 2013. The gross asset amount of the derivative listed below is the maximum loss
the Company would incur if the counterparties failed to meet their obligation.
Gross Amounts of Recognized
Liabilities Gross Amounts Offset in the
Consolidated Balance Sheets
Net Amounts of Liabilities
Presented in the Consolidated
Balance Sheets
(in thousands)
December 31, 2014 . . . . . . . . . . . . . . . . $ 2,947 $ (5,499) $ (2,552)
December 31, 2013 . . . . . . . . . . . . . . . . $ 8,324 $ (5,707) $ 2,617
13. Employee Benefit Plans
We sponsor a defined contribution savings plan for employees in the United States that provides certain of our eligible
employees an opportunity to accumulate funds for retirement. We also sponsor similar HotelClub and ebookers defined
contribution savings plans. After employees have attained one year of service, we match the contributions of participating
employees on the basis specified by the plans, up to a maximum of 3% of participant compensation. We recorded total expense
related to these plans in the amount of $5.3 million, $4.9 million and $4.8 million for the years ended December 31, 2014, 2013
and 2012, respectively.