SEC Filings

10-Q
WESTLAKE CHEMICAL CORP filed this Form 10-Q on 05/03/2018
Entire Document
 

WESTLAKE CHEMICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(Unaudited)
(in millions of dollars, except share amounts and per share data)

6. Accumulated Other Comprehensive Income (Loss)
Changes in accumulated other comprehensive income (loss) by component for the three months ended March 31, 2018 and 2017 were as follows:
 
 
Benefits
Liability,
Net of Tax
 
Cumulative
Foreign
Currency
Exchange,
Net of Tax
 
Total
Balances at December 31, 2016
 
$
29

 
$
(150
)
 
$
(121
)
Other comprehensive income before reclassifications
 

 
17

 
17

Net other comprehensive income attributable
to Westlake Chemical Corporation
 

 
17

 
17

Balances at March 31, 2017
 
$
29

 
$
(133
)
 
$
(104
)
 
 
 
 
 
 
 
Balances at December 31, 2017
 
$
43

 
$
(36
)
 
$
7

Other comprehensive loss before reclassifications
 

 
(4
)
 
(4
)
Net other comprehensive loss attributable
   to Westlake Chemical Corporation
 

 
(4
)
 
(4
)
Balances at March 31, 2018
 
$
43

 
$
(40
)
 
$
3

7. Derivative Instruments
In January 2018, the Company entered into cross-currency swaps with an aggregate notional value of 220 million euros to reduce the volatility in stockholders' equity from changes in currency exchange rates associated with the Company's net investments in foreign operations. These cross-currency swaps were designated in a net investment hedge relationship. The Company assesses hedge effectiveness of these cross-currency swaps by comparing the spot rate change in the swaps to the spot rate change in the designated net investment. For the three months ended March 31, 2018, there was no ineffectiveness recorded with regard to the Company's qualifying net investment hedges.
The fair values of derivatives designated as hedging instruments in the Company's consolidated balance sheets were as follows:
 
 
Derivative Liabilities
 
 
Balance Sheet Location
 
Fair Value as of
Derivatives in Net Investment Hedging Relationships
 
March 31,
2018
 
December 31,
2017
Foreign exchange contracts
 
Other liabilities
 
$
18

 
$

The following table summarizes the effect of foreign exchange derivative instruments designated as net investment hedges in the consolidated statements of operations.

 
 
 
Gain (Loss) Recognized in Income and Excluded from Hedge Effectiveness
 
 
 
 
Three Months Ended March 31,
Derivatives in Net Investment Hedging Relationships
 
Location of Gain (Loss) Recognized in Income on Derivative
 
2018
 
2017
Foreign exchange contracts
 
Other income, net
 
$
1

 
$


13