1 unchanged sentence
Interest Rate Risk
−Removed: The total amount of short-term debt, net of cash, amounted to net debt of $769.2 million and net debt of $317.9 million, at March 31, 2024 and December 31, 2023, respectively.
−Removed: A hypothetical 100 basis point increase in interest rates applied to this variable-rate short-term debt as of March 31, 2024 would have changed interest expense by approximately $1.9 million for the first three months of 2024 and $3.1 million for 2023.
+Added: The total amount of short-term debt, net of cash, amounted to net debt of $854.2 million and net debt of $317.9 million, at June 30, 2024 and December 31, 2023, respectively.
+Added: A hypothetical 100 basis point increase in interest rates applied to this variable-rate short-term debt as of June 30, 2024 would have changed interest expense by approximately $4.1 million for the first six months of 2024 and $3.1 million for 2023.
We consider our current risk related to market fluctuations in interest rates on our remaining debt portfolio, excluding fixed-rate debt converted to variable rates with fixed-to-floating instruments, to be minimal since this debt is largely long-term and fixed-rate in nature.
Generally, the fair market value of fixed-rate debt will increase as interest rates fall and decrease as interest rates rise.
−Removed: A 100 basis point increase in market interest rates would decrease the fair value of our fixed-rate long-term debt at March 31, 2024 and December 31, 2023 by approximately $162 million and $203 million, respectively.
−Removed: However, since we currently have no plans to repurchase our outstanding fixed-rate instruments before their maturities, the impact of market interest rate fluctuations on our long-term debt does not affect our results of operations or financial position.
+Added: A 100 basis point increase in market interest rates would decrease the fair value of our fixed-rate long-term debt at June 30, 2024 and December 31, 2023 by approximately $169 million and $203 million, respectively.
+Added: However, since we currently have no plans to repurchase our outstanding fixed-rate instruments
+Added: The Hershey Company | Q2 2024 Form 10-Q | Page 44
+Added: before their maturities, the impact of market interest rate fluctuations on our long-term debt does not affect our results of operations or financial position.
Foreign Currency Exchange Rate Risk
3 unchanged sentences
We estimate the fair value of foreign currency forward exchange contracts on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences.
−Removed: The potential decline in fair value of foreign currency forward exchange contracts resulting from a hypothetical near-term adverse change in market rates of 10% was $19.2 million as of March 31, 2024 and $20.2 million as of December 31, 2023, generally offset by a reduction in foreign exchange associated with our transactional activities.
−Removed: The Hershey Company | Q1 2024 Form 10-Q | Page 40
+Added: The potential decline in fair value of foreign currency forward exchange contracts resulting from a hypothetical near-term adverse change in market rates of 10% was $11.6 million as of June 30, 2024 and $20.2 million as of December 31, 2023, generally offset by a reduction in foreign exchange associated with our transactional activities.
Commodities—Price Risk Management and Derivative Contracts
2 unchanged sentences
Cocoa Products
−Removed: During the first quarter of 2024, the average cocoa futures contract price was $2.60 per pound, with a trading range of $1.99 to $3.35 per pound, based on the Intercontinental Exchange futures contract.
+Added: During the first six months of 2024, the average cocoa futures contract price was $3.34 per pound, with a trading range of $1.84 to $5.20 per pound, based on the Intercontinental Exchange futures contract.
This average cocoa futures contract price represents an increase of approximately 124% compared to the 2023 annual average of $1.49 per pound.
−Removed: The production forecast for the 2023 – 2024 season is down significantly in Ghana and Ivory Coast, and has continued to deteriorate due to a combination of adverse weather and crop disease, leading to lower than expected outputs and a reduction in global cocoa bean inventory.
−Removed: Further, during April 2024, we continued to experience rising market prices for cocoa futures, which may have an impact on our financial condition and results of operations.
+Added: The production forecast for the 2024 – 2025 season is improving in Ghana and Ivory Coast, due to a combination of favorable weather conditions and decreased demand for cocoa;
+Added: however, the price outlook for cocoa remains uncertain due to significant liquidity and volatility issues, which may have an impact on our financial condition and results of operations.
Our costs for cocoa products will not necessarily reflect market price fluctuations because of our forward purchasing and hedging practices (including amount and duration thereof), premiums and discounts reflective of varying delivery times, and supply and demand for our specific varieties and grades of cocoa liquor, cocoa butter and cocoa powder.
2 unchanged sentences
Commodity Sensitivity Analysis
−Removed: Our open commodity derivative contracts had a notional value of $206.3 million as of March 31, 2024 and $94.9 million as of December 31, 2023.
−Removed: At the end of the first quarter of 2024, the potential change in fair value of commodity derivative instruments, assuming a 10% decrease in the underlying commodity price, would have increased our net unrealized losses by $10.5 million, generally offset by a reduction in the cost of the underlying commodity purchases.
+Added: Our open commodity derivative contracts had a notional value of $92.3 million as of June 30, 2024 and $94.9 million as of December 31, 2023.
+Added: At the end of the second quarter of 2024, the potential change in fair value of commodity derivative instruments, assuming a 10% decrease in the underlying commodity price, would have increased our net unrealized losses by $1.4 million, generally offset by a reduction in the cost of the underlying commodity purchases.
For additional information about our market risks, see Item 7A under Part II of our 2023 Annual Report on Form 10-K.
1 unchanged sentence
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.