Derivative Financial Instruments

12 Months Ended

Apr. 30, 2019

Derivative Financial Instruments [Abstract]

15. Derivative Financial Instruments

In the fourth quarter of fiscal 2019, we entered into certain callable interest rate swaps with notational amounts totaling $1,500.0 million to mitigate our exposure to the variability of the three-month LIBOR for our floating rate debt. These callable interest rate swaps had an effective date of April 5, 2019, with a 60-month term expiring on March 31, 2024, and no interest rate floor. These swaps are callable by Infor beginning on March 31, 2021, and quarterly thereafter through December 31, 2023, under which we can terminate the contracts early at no cost. The callable interest rate swaps have not been designated as hedging instruments for accounting purposes.

Prior to this we had entered into certain interest rate swaps with notional amounts totaling $945.0 million to mitigate our exposure to the variability of the three-month LIBOR for our floating rate debt. We had designated these instruments as cash flow hedges upon initiation and they were highly effective from their inception to maturity. These interest rate swaps had an effective date of March 31, 2015, with a 30-month term which expired on September 29, 2017, and had a 1.25% floor.

The following table presents the fair values of the derivative financial instruments included on our Consolidated Balance Sheets at the dates indicated:



		Notional	Derivative		Balance Sheet		Fair Value at April 30,
(in millions, except percentages)		Amount	Base		Classification		2019		2018
Derivatives not designated as hedging instruments:
Callable interest rate swap	$	600.0	2.7440	%	Accrued expenses	$	(1.0)	$	-
					Other long-term liabilities		(0.6)		-
Callable interest rate swap		450.0	2.7375	%	Accrued expenses		(0.7)		-
					Other long-term liabilities		(0.4)		-
Callable interest rate swap		300.0	2.7440	%	Accrued expenses		(0.5)		-
					Other long-term liabilities		(0.3)		-
Callable interest rate swap		150.0	2.7600	%	Accrued expenses		(0.2)		-
					Other long-term liabilities		(0.3)		-
Total	$	1,500.0			Total liabilities	$	(4.0)	$	-

Changes in the fair value of the derivative not designated as hedging instruments are recognized in our results of operations in interest expense, net in our Consolidated Statements of Operations.

The following table presents the before-tax impact of our previous derivative financial instruments designated as cash flow hedges on our other comprehensive income (OCI), accumulated other comprehensive income (AOCI), and our statement of operations for the periods indicated:



	Statement of		Year Ended April 30,
(in millions)	Operations Location		2019		2018		2017
Accounting cash flow hedges:
Interest rate swaps
Effective portion - gain (loss)
recognized in OCI		$	-	$	(0.1)	$	(0.9)
(Gain) loss reclassified from AOCI
into net income	Interest expense, net	$	-	$	4.7	$	11.7

We have no other derivatives instruments designated as accounting hedges. The amounts reflected in the above tables do not include any adjustments to reflect the impact of deferred income taxes. For all periods presented, there were no gains or losses recognized in income related to hedge ineffectiveness.

As of April 30, 2019, there were no amounts included in accumulated other comprehensive income (loss) related to our derivative instruments to be reclassified into earnings during the next twelve months.

Infor, Inc. 10-K