Company: EPR-PE
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001045450-25-000082
Chunk: 34

Company: EPR PROPERTIES
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 34
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 will be reclassified from AOCI to interest expense.Cash Flow Hedges of Foreign Exchange RiskThe Company is exposed to foreign currency exchange risk against its functional currency, USD, on CAD denominated cash flow from its six Canadian properties. The Company uses cross-currency swaps to mitigate its exposure to fluctuations in the USD-CAD exchange rate on cash inflows associated with these properties, which should hedge a significant portion of the Company's expected CAD denominated cash flows. As of March 31, 2025, the Company had the following cross-currency swaps: 

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Fixed rateNotional Amount (in millions, CAD)Annual Cash Flow (in millions, CAD)Maturity$1.35 CAD per USD$170.0 $15.3 December 1, 2026$1.35 CAD per USD90.0 8.1 December 1, 2026$260.0 $23.4 The change in the fair value of foreign currency derivatives designated and that qualify as cash flow hedges of foreign exchange risk is recorded in AOCI and reclassified into earnings in the period that the hedged forecasted transaction affects earnings within the same income statement line item as the earnings effect of the hedged transaction. As of March 31, 2025, the Company estimates that during the twelve months ending March 31, 2026, $0.8 million of gains will be reclassified from AOCI to other income.Net Investment HedgesThe Company is exposed to fluctuations in the USD-CAD exchange rate on its net investments in Canada. As such, the Company uses currency forward agreements to manage its exposure to changes in foreign exchange rates on certain of its foreign net investments. As of March 31, 2025, the Company had the following foreign currency forwards designated as net investment hedges:Fixed rateNotional Amount (in millions, CAD)Maturity$1.40 CAD per USD$200.0 December 1, 2026$1.40 CAD per USD90.0 December 1, 2026Total$290.0 For qualifying foreign currency derivatives designated as net investment hedges, the change in the fair value of the derivatives is reported in AOCI as part of the cumulative translation adjustment. Amounts are reclassified out of AOCI into earnings when the hedged net investment is either sold or substantially liquidated. Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized over the life