Fortune Brands Innovations, Inc. Fair Value Disclosure
ASC requirements for Fair Value Measurements and Disclosures establish a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels. Level 1 inputs, the highest priority, are quoted prices in active markets for identical assets or liabilities. Level 2 inputs reflect other than quoted prices included in level 1 that are either observable directly or through corroboration with observable market data. Level 3 inputs are unobservable inputs due to little or no market activity for the asset or liability, such as internally developed valuation models. We do not have any assets or liabilities measured at fair value on a recurring basis that are level 3, except for pension assets discussed in Note 14, "Defined Benefit Plans."
The carrying value and fair value of debt as of December 27, 2025 and December 28, 2024 were as follows:
(In millions) |
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December 27, 2025 |
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December 28, 2024 |
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Carrying |
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Fair |
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Carrying |
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Fair |
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Notes, net of underwriting commissions, price |
|
$ |
2,176.1 |
|
|
$ |
2,109.3 |
|
|
$ |
2,673.3 |
|
|
$ |
2,522.5 |
|
Commercial Paper |
|
|
368.8 |
|
|
|
368.8 |
|
|
|
— |
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— |
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The estimated fair value of our 2022 Revolving Credit Agreement is determined primarily using broker quotes, which are level 2 inputs. The estimated fair value of our Notes is determined by using quoted market prices of our debt securities, which are level 1 inputs.
Assets and liabilities measured at fair value on a recurring basis as of December 27, 2025 and December 28, 2024 were as follows:
(In millions) |
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Fair Value |
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2025 |
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2024 |
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Assets: |
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Derivative asset financial instruments (level 2) |
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$ |
1.2 |
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|
|
$ |
8.6 |
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Liabilities: |
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|
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|
|
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Derivative liability financial instruments (level 2) |
|
$ |
4.5 |
|
|
|
$ |
2.7 |
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The principal derivative financial instruments we enter into on a routine basis are foreign exchange contracts. In addition, from time to time, we enter into commodity swaps. Derivative financial instruments are recorded at fair value.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 23, 2026 | Showing above |
| 2024 | Feb 25, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Feb 24, 2021 | |
| 2019 | Feb 26, 2020 | |
| 2018 | Feb 25, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Feb 28, 2017 | |
| 2015 | Feb 25, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.