Pension Plans

6 Months Ended

Jun. 30, 2011

Pension Plans

Pension Plans

NOTE 3—PENSION PLANS

The Company sponsors a contributory defined benefit pension plan (the "Plan") covering a number of its current and former employees in the United Kingdom. The components of the net periodic cost were as follows:

	Three Months Ended June  30						Six Months Ended June  30
(in millions)	2011			2010			2011			2010
Service cost	$	(0.4	)	$	(0.2	)	$	(0.8	)	$	(1.2	)
Interest cost on projected benefit obligation		(9.3	)		(9.8	)		(18.3	)		(20.4	)
Expected return on plan assets		9.3			8.8			18.4			18.0
Amortization of prior service credit		0.4			0.3			0.7			0.3
Amortization of actuarial net losses		(0.1	)		(1.2	)		(0.2	)		(2.6	)
	$	(0.1	)	$	(2.1	)	$	(0.2	)	$	(5.9	)

The Company closed the Plan to future service accrual with effect from March 31, 2010 and accordingly we recorded a non-cash curtailment loss of $8.2 million in the first quarter of 2010. During the second quarter of 2010 the Company implemented a pension increase exchange ("PIE") program for current pensioners, effective April 1, 2010, which reduced the projected benefit obligation ("PBO") by $17.1 million. This reduction in PBO resulted in a prior service credit which is being amortized using the straight-line method over the remaining life expectancy of Plan pensioners of 15 years commencing April 1, 2010. The PIE program provided pensioners with the option of receiving a one-off immediate increase to their pension in lieu of future non-statutory increases. During the fourth quarter of 2010 the Company implemented an enhanced transfer value ("ETV") program for deferred pensioners which reduced the PBO by $15.7 million and resulted in a settlement loss of $1.1 million. The ETV program provided deferred pensioners with the option of transferring their existing pension entitlement from the Plan to another vehicle in exchange for an enhancement to the standard terms available for such a transfer.

The Company expects its annual cash contribution to the Plan for 2011 to be approximately $9 million (2010—$15.5 million).

A full triennial actuarial valuation of the Plan was performed as at December 31, 2008 and an update performed as at December 31, 2010. Following guidance issued by the United Kingdom government during 2010, and agreement from the Plan trustees, the Company changed the inflation rate measure used in the December 31, 2010 update from the Retail Prices Index to the Consumer Prices Index resulting in a reduction in actuarial net losses on an accounting basis of approximately $47 million. At June 30, 2011, the Company has a pension liability of $7.8 million recorded in its balance sheet.