Item 7A. Quantitative and Qualitative Disclosures About Market Risk
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company has limited exposure to fluctuation in foreign currency exchange rates to U.S. dollar, primarily in Canadian dollars and Euros currency. Approximately 92% of the Company’s consolidated sales are transacted in U.S. dollars. Net assets held in or measured in Canadian dollars amounted to $11.6 million at December 31, 2021. A 10% change in the value of the U.S. dollar versus the Canadian dollar would have had a $0.8 million impact to 2021 net income. Net assets held in or measured in Euros amounted to $26.5 million at December 31, 2021. A 10% change in the value of the U.S. dollar versus the Euros would have had a $0.1 million impact to 2021 net income.
Risk due to fluctuation in interest rates is a function of the Company’s floating rate debt obligations, which total approximately $163.0 million at December 31, 2021. A change of 1% in interest rates of all variable rate debt would impact annual net income by approximately $1.6 million, before income taxes.
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