World Fuel Services 2014 Annual Report Download - page 40

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35
Fair Value Hedges. Includes derivatives we enter into in order to hedge price risk associated with our inventory and
certain firm commitments relating to fixed price purchase and sale contracts.
Non-designated Derivatives. Includes derivatives we primarily enter into in order to mitigate the risk of market price
fluctuations in aviation, marine and land fuel in the form of swaps or futures as well as certain fixed price purchase and
sale contracts and proprietary trading. In addition, non-designated derivatives are also entered into to hedge the risk of
currency rate fluctuations.
As of December 31, 2014, our derivative instruments, at their respective fair value positions were as follows (in thousands,
except weighted average fixed price and weighted average mark-to-market amount):
Weighted
Weighted Average
Average Mark-to- Fai
r
Settlement Fixed Market Value
Hedge Strategy Period Derivative Instrument Notional Unit Price Amount Amount
Fair Value Hedge 2015 Commodity contracts for inventory hedging (long) 305 BBL $ 74.110 $ (3.203) $ (977)
2015 Commodity contracts for inventory hedging (short) 4,977 BBL 77.510 4.599 22,889
$ 21,912
Non-Designated 2015 Commodity contracts (long) 34,192 BBL $ 62.693 $ (15.594) $ (533,192)
2015 Commodity contracts (short) 27,013 BBL 83.370 20.735 560,114
2016 Commodity contracts (long) 1,131 BBL 89.989 (23.195) (26,234)
2016 Commodity contracts (short) 722 BBL 85.497 17.734 12,804
2017 Commodity contracts (long) 92 BBL 46.463 (6.696) (616)
2017 Commodity contracts (short) 109 BBL 54.430 7.743 844
2018 Commodity contracts (long) 1 BBL 25.922 (4.000) (4)
2018 Commodity contracts (short) 11 BBL 83.997 21.636 238
2015 Foreign currency contracts 28,783 AUD 0.850 0.005 158
2015 Foreign currency contracts 471 BRL 2.580 (0.013) (6)
2015 Foreign currency contracts 61,577 CAD 1.140 0.020 1,215
2015 Foreign currency contracts 112 CHF 0.960 0.036 4
2015 Foreign currency contracts 4,764,256 CLP 602.490 0.000 27
2015 Foreign currency contracts 31,884,747 COP 2,174.000 0.000 408
2015 Foreign currency contracts 126,778 DKK 5.950 0.001 64
2015 Foreign currency contracts 77,278 EUR 1.250 0.019 1,464
2015 Foreign currency contracts 208,786 GBP 1.610 0.023 4,903
2015 Foreign currency contracts 135,879 INR 63.040 0.000 24
2015 Foreign currency contracts 1,390,740 JPY 113.080 0.000 295
2015 Foreign currency contracts 2,382,533 MXN 13.920 (0.000) (321)
2015 Foreign currency contracts 214,957 NOK 6.720 0.001 253
2015 Foreign currency contracts 7,912 PLN 3.400 0.016 125
2015 Foreign currency contracts 32,891 RON 3.570 0.014 452
2015 Foreign currency contracts 46,921 SGD 1.300 0.004 176
2015 Foreign currency contracts 78,298 ZAR 11.310 0.001 41
2016 Foreign currency contracts 8,325 GBP 1.620 0.055 459
2017 Foreign currency contracts 1,400 GBP 1.610 0.033 46
$ 23,741
Interest Rate
Borrowings under our Credit Facility and Term Loans related to base rate loans or Eurodollar rate loans bear floating interest
rates plus applicable margins. As of December 31, 2014, the applicable margins for base rate loans and Eurodollar rate
loans were 1.25% and 2.25%, respectively. As of December 31, 2014, we had outstanding borrowings under our Credit
Facility totaling $420.0 million and $241.3 million in Term Loans. As of December 31, 2014, the aggregate outstanding
balance of our promissory notes issued in connection with our acquisitions was $12.6 million, which bear interest at annual
rates of approximately 1.2%. Our remaining outstanding debt of $15.9 million as of December 31, 2014 primarily relates to
capital leases and loans payable to noncontrolling shareholders of a consolidated subsidiary, which bear interest at annual
rates ranging from 2.2% to 6.3%. The weighted average interest rate on our short-term debt was 2.2% as of December 31,
2014. A 1.0% fluctuation in the interest rate on our outstanding debt would result in a $6.9 million change in interest expense
during the next twelve months.
Foreign Currency
We analyzed our assets and liabilities denominated in currencies other than their respective functional currencies to identify
consolidated currency exposures as of December 31, 2014, including derivatives utilized to hedge such exposures. For
these assets and liabilities, we then assessed the effect of a hypothetical uniform 10% strengthening in the value of the U.S.