Quarterly report [Sections 13 or 15(d)]

Assets and Liabilities Measured at Fair Value

v3.26.1
Assets and Liabilities Measured at Fair Value
 6 Months Ended
Jun. 30, 2026
Assets and Liabilities Measured at Fair Value  
Assets and Liabilities Measured at Fair Value

(4) Assets and Liabilities Measured at Fair Value

For assets and liabilities required to be reported at fair value, GAAP provides a hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three broad levels. Level 1 inputs are quoted market prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs are inputs, other than quoted market prices included within Level 1, that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. The Company does not have any recurring assets or liabilities measured at fair value that would be considered Level 3.

The Company’s assets and liabilities measured at fair value are as follows:

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June 30, 2026

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December 31, 2025

 

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Quoted prices

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Significant

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Quoted prices

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Significant

 

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in active

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other

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in active

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other

 

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markets for

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observable

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markets for

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observable

 

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identical assets

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inputs

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identical assets

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inputs

 

Description

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Total

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(Level 1)

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(Level 2)

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Total

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(Level 1)

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(Level 2)

 

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amounts in millions

 

Cash equivalents

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$

42

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42

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—

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57

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57

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—

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Restricted cash equivalents

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$

—

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—

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—

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38

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38

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—

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Exchangeable senior debentures

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$

—

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—

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—

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956

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—

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956

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Prior to their redemption, the Company’s exchangeable senior debentures were debt instruments with quoted market value prices that were not considered to be traded on “active markets”, as defined in GAAP, and were reported in the foregoing table as Level 2 fair value.

Other Financial Instruments

Other financial instruments not measured at fair value on a recurring basis include normal working capital accounts, equity securities, preferred stock and both current and long-term debt (with the exception of the 3.125% Debentures due 2054 prior to their redemption in the second quarter of 2025 and the 3.125% Debentures due 2053 prior to their redemption in the second quarter of 2026 (each as defined in note 6)). With the exception of long-term debt and preferred stock, the carrying amount approximates fair value due to the short maturity of these instruments as reported on our condensed consolidated balance sheets. The carrying values of the Margin Loan Facility and the Charter Loan Facility (each as defined in note 6) bear interest at variable rates and therefore are also considered to approximate fair value.

Realized and Unrealized Gains (Losses) on Financial Instruments

Realized and unrealized gains (losses) on financial instruments are comprised of changes in the fair value of the following:

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Three months ended

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Six months ended

 

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June 30,

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June 30,

 

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2026

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2025

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2026

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2025

 

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amounts in millions

 

Exchangeable senior debentures (1)

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$

19

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76

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10

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39

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Other

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1

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—

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7

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—

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$

20

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76

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17

 

39

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(1) The Company has elected to account for its exchangeable senior debentures using the fair value option. Changes in the fair value of the exchangeable senior debentures recognized in the condensed consolidated statements of operations are primarily due to market factors driven by changes in the fair value of the underlying shares into which the debt is exchangeable. The Company isolates the portion of the unrealized gain (loss) attributable to the change in the instrument specific credit risk and recognizes such amount in other comprehensive income. The change in the fair value of the exchangeable senior debentures attributable to changes in the instrument specific credit risk before tax was a gain of $8 million and a loss of $9 million for the three and six months ended June 30, 2025, respectively, net of the recognition of previously unrecognized gains and losses. As all outstanding exchangeable senior debentures were retired on April 6, 2026, there was no change in fair value attributable to changes in the instrument specific credit risk before tax during the three months ended June 30, 2026 and a loss of less than $1 million for the six months ended June 30, 2026. During the three and six months ended June 30, 2026, the Company recognized $20 million of previously unrecognized gains related to the retirement of the 3.125% Debentures due 2053. As such, the net cumulative change after the retirement of the outstanding exchangeable senior debentures is zero as of June 30, 2026.