Company: GEF
Filing Date: 2025-02-27
Form Type: 10-Q
Source: 0000043920-25-000009
Chunk: 23

Company: GREIF, INC
Filing Date: 2025-02-27
Form: 10-Q
Item: Part I, Item 1
Chunk 23
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 the aggregate gain or loss included within other comprehensive income (loss). The gain or loss on the cash flow hedge derivative instruments is included in the unrealized foreign exchange component of other expense, offset by the underlying gain or loss on the underlying cash flows that are being hedged. Interest payments received for the cross currency swap are excluded from the net investment hedge effectiveness assessment and are recorded in interest expense, net on the consolidated statements of income. The assumptions used in measuring fair value of the cross currency swap are considered level 2 inputs, which are based upon the Euro to United States dollar exchange rate market.For the three months ended January 31, 2025 and 2024, gains recorded in interest expense, net under the cross currency swap agreements were $1.6 million and $1.9 million, respectively. During the first quarter of 2025, the Company executed a cash settlement of certain cross-currency swap contracts and simultaneously entered into new cross-currency swaps at prevailing market rates. The net cash settlement from restriking these swaps resulted in a cash receipt of $22.5 million of which $11.5 million related to cross-currency swap contracts designated as net investment hedges and $11.0 million related to cross-currency swap contracts designated as cash flow hedges.The net investment hedges that were settled resulted in a final gain of $11.3 million, which is included in the foreign currency translation component of other comprehensive income (“OCI”) and the final OCI balance on these transactions is maintained on the balance sheet until the underlying hedged subsidiary is either sold or substantially liquidated. For the cash flow hedges that were settled, the gain will be recognized to income, through interest expense, over time through an amortization of the remaining OCI balance at termination. This OCI balance amounted to $1.8 million and will be recognized on a straight-line basis to the income statement through the transaction’s original maturity date of October 5, 2026.

17

Other Financial InstrumentsThe fair values of the Company’s 2022 Credit Agreement, the 2023 Credit Agreement, the U.S. RFA, and the European RFA do not materially differ from carrying value as the Company’s cost of borrowing is variable and approximates current borrowing rates. The fair values of the Company’s long-term obligations are estimated based on either the quoted market prices for the same or similar issues or the current interest rates offered for the debt of the same remaining maturities, which are considered level 2