Company: NGVT
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001653477-25-000015
Chunk: 1094

Company: Ingevity Corp
Filing Date: 2025-02-19
Form: 10-K
Item: Item 8
Chunk 1094
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 estimated pre-tax amortization expense may fluctuate due to changes in foreign currency exchange rates.

Note 9: Financial Instruments and Risk Management

Net Investment HedgesDuring 2022, we terminated our fixed-to-fixed cross-currency interest rate swaps, accounted for as net investment hedges, and received net proceeds of $14.7 million. The proceeds are presented within cash provided by investing activities within the consolidated statement of cash flows. The $14.7 million gain is reported as a component of the CTA within AOCI on the consolidated balance sheet. Gains from net investment hedges are reclassified to earnings only when the related CTA are required to be reclassified, usually upon the sale or liquidation of the investment (i.e., the legal entity). The fair value of our net investment hedge was a net asset (liability) of zero at December 31, 2024 and 2023. During the years ended December 31, 2024, 2023, and 2022, we recognized net interest income associated with this financial instrument of zero, zero, and $1.1 million, respectively.Cash Flow HedgesForeign Currency Exchange Risk ManagementWe manufacture and sell our products in several countries throughout the world and thus, we are exposed to changes in foreign currency exchange rates. To manage the volatility relating to these exposures, we net the exposures on a consolidated basis to take advantage of natural offsets. To manage the remaining exposure, from time to time, we utilize forward currency exchange contracts and zero cost collar option contracts to minimize the volatility to earnings and cash flows resulting from the effect of fluctuating foreign currency exchange rates on export sales denominated in foreign currencies (principally the euro). These contracts are generally designated as cash flow hedges. As of December 31, 2024, open foreign currency exchange contracts hedge a portion of forecasted transactions until January 2026. Designated cash flow hedges entered to minimize foreign currency exchange risk of forecasted revenue transactions are recorded to Net sales on the consolidated statement of operations when the forecasted transaction occurs. As of December 31, 2024, there were $6.5 million in open foreign currency derivative contracts. The fair value of the designated foreign currency hedge contracts was an asset (liability) of $0.1 million and zero as of December 31, 2024 and 2023, respectively.

73

IndexIngevity CorporationNotes to the Consolidated Financial StatementsDecember 31,