Company: KHC
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0001637459-25-000152
Chunk: 32

Company: Kraft Heinz Co
Filing Date: 2025-07-30
Form: 10-Q
Item: Part I, Item 1
Chunk 32
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 ($71 million) and other non-current assets ($7 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($16 million) and other non-current liabilities ($1 million). (b)    At December 28, 2024, the fair value of our derivative assets was recorded in other current assets ($69 million) and other non-current assets ($68 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($34 million) and other non-current liabilities ($138 million).(c)    At December 28, 2024, the fair value of our derivative assets was recorded in other current assets and the fair value of our derivative liabilities was recorded in other current liabilities ($55 million) and other non-current liabilities ($1 million).Our derivative financial instruments are subject to master netting arrangements that allow for the offset of assets and liabilities in the event of default or early termination of the contract. We elect to record the gross assets and liabilities of our derivative financial instruments on the condensed consolidated balance sheets. If the derivative financial instruments had been netted on the condensed consolidated balance sheets, the asset and liability positions each would have been reduced by $207 million at June 28, 2025 and $141 million at December 28, 2024. We had posted collateral related to commodity derivative margin requirements of $10 million at June 28, 2025 and $25 million at December 28, 2024, which were included in prepaid expenses on our condensed consolidated balance sheets. Level 1 derivative financial assets and liabilities consist of commodity future and options contracts and are valued using quoted prices in active markets for identical assets and liabilities.

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Level 2 derivative financial assets and liabilities consist of commodity swaps, foreign exchange forwards, options, and swaps, and cross-currency contracts. Commodity swaps are valued using an income approach based on the observable market commodity index prices less the contract rate multiplied by the notional amount. Foreign exchange forwards and swaps are valued using an income approach based on observable market forward rates less the contract rate multiplied by the notional amount. Foreign exchange options are valued using an income approach based on a Black-Scholes-Merton formula. This formula uses present value techniques and reflects the time value and intrinsic value based on observable market rates. Cross-currency contracts are valued based on observable market spot and swap rates.We did not have any Level 3 derivative financial assets or liabilities in any period presented.Our