Cash flow hedge gain (loss) to be reclassified within twelve months

[Table of Contents](#i3d0ebbc4e2a2420f98ed7e6fe698936a_7) HASBRO, INC. AND SUBSIDIARIESNotes to Consolidated Financial Statements — (Continued)  
Gains (Losses) on Derivative InstrumentsAt December 26, 2021, the Company had remaining net deferred gains on foreign currency forward contracts, net of tax, of $9.6 million in AOCE. These instruments hedge payments related to inventory purchased in the fourth quarter of 2021 or forecasted to be purchased in 2022, intercompany expenses expected to be paid or received during 2022, television and movie production costs paid in 2021 or expected to be paid in 2022 or 2023, and cash receipts for sales made at the end of the fourth quarter of 2021 or forecasted to be made in 2022. These amounts will be reclassified into the consolidated statements of operations upon the sale of the related inventory or recognition of the related sales expenses.In addition to foreign currency forward contracts, the Company entered into hedging contracts on future interest payments related to the 3.15% Notes, that were repaid in full in the aggregate principal amount of $300.0 million during the first quarter of 2021 (See note 11), and the 5.10% Notes due 2044. At the date of debt issuance, these contracts were terminated and the fair value on the date of settlement was deferred in AOCE and is being amortized to interest expense over the life of the related notes using the effective interest rate method. At December 26, 2021, deferred losses, net of tax, of $15.6 million related to these instruments remained in AOCE. For the year ended December 26, 2021, losses, net of tax of $1.0 million related to these hedging instruments were reclassified from AOCE to net earnings. For each of the years ended December 27, 2020 and December 29, 2019, losses, net of tax of $1.4 million, related to these hedging instruments were reclassified from AOCE to net earnings.Of the net deferred gains included in AOCE at December 26, 2021, the Company expects net gains of approximately $8.0 million to be reclassified to the consolidated statements of operations within the next 12 months. However, the amount ultimately realized in earnings is dependent on the fair value of the hedging instruments on the settlement dates.See notes 16 and 18 for additional discussion on reclassifications from AOCE to earnings.(5)    Property, Plant and Equipment

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| (In millions) | 2021 |  | 2020 |
| Land and improvements | $ | 3.2  |  |  | 3.4  |  |
| Buildings and improvements | 220.3  |  |  | 219.6  |  |
| Machinery, equipment and software | 604.7  |  |  | 559.2  |  |
|  | 828.2  |  |  | 782.2  |  |
| Less accumulated depreciation | 630.0  |  |  | 553.0  |  |
|  | 198.2  |  |  | 229.2  |  |
| Tools, dies and molds, net of accumulated depreciation | 63.6  |  |  | 68.0  |  |
|  | 261.8  |  |  | 297.2  |  |
| Right of use assets | 256.4  |  |  | 255.1  |  |
| Less accumulated depreciation | 97.1  |  |  | 63.3  |  |
| Total property, plant and equipment, net | $ | 421.1  |  |  | 489.0  |  |

Expenditures for maintenance and repairs which do not materially extend the life of the assets are charged to operations as incurred. In 2021, 2020 and 2019 the Company recorded $163.3 million, $120.2 million and $133.5 million, respectively, of depreciation expense.See note 17 for additional discussion on right of use assets.93
