x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 58-2480149 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) | |
55 Glenlake Parkway, N.E. Atlanta, Georgia | 30328 | |
(Address of Principal Executive Offices) | (Zip Code) |
Title of Each Class | Name of Each Exchange on Which Registered | |
Class B common stock, par value $.01 per share | New York Stock Exchange |
Large accelerated filer x | Accelerated filer ¨ | Non-accelerated filer ¨ | Smaller reporting company ¨ |
PART I | ||
Item 1. | ||
Item 1A. | ||
Item 1B. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II | ||
Item 5. | ||
Item 6. | ||
Item 7. | ||
Item 7A. | ||
Item 8. | ||
Item 9. | ||
Item 9A. | ||
Item 9B. | ||
PART III | ||
Item 10. | ||
Item 11. | ||
Item 12. | ||
Item 13. | ||
Item 14. | ||
PART IV | ||
Item 15. |
Item 1. | Business |
• | UPS Temperature True - an air freight solution specifically designed to safeguard temperature-sensitive shipments using a portfolio of specialized containers with passive, semi-active, or active refrigeration. This service incorporates monitoring intervention capabilities and provides door-to-door transportation of sensitive products in accordance with precise, measurable operating procedures. In 2013, UPS expanded its Temperature True offering with two additional service levels: |
1. | “Temperature True Standard”, which provides an ideal solution for air freight passive containers requiring either refrigerated or controlled room temperatures; and |
2. | “Temperature True Saver”, which is a pioneering temperature-sensitive solution for Ocean Freight shippers. |
• | UPS Proactive Response Secure - safeguards the most valuable time- and temperature-sensitive items in the supply chain with contingency plans and financial risk mitigation. In addition to our basic Proactive Response service, insurance capabilities through UPS Capital are available; this is a unique offering in the marketplace. |
• | UPS Quantum View, which can help customers better manage shipments, facilitate tracking, allow for inbound volume planning, manage third-party shipping costs and automatically notify customers of incoming shipments. With visibility into transit times and delivery confirmations, customers can speed up their revenue cycle and collect accounts receivables more quickly. |
• | WorldShip, which is UPS’s flagship desktop shipping application, provides middle market and large customers with robust shipping capabilities. Customers can create custom labels, set up shipment alerts, create and upload customs documentation, track and export shipments, create reports and integrate with their enterprise resource planning and accounting systems to streamline shipping with real-time connectivity. |
• | UPS Paperless Invoice, which enables customers to submit a commercial invoice electronically when shipping internationally. This eliminates redundant data entry and errors, while reducing customs holds and paper waste. |
• | UPS Access Point, which provides our customers a convenient alternative to home delivery, allows customers to use shops, convenience stores and other retail locations as a delivery location and a drop off location for return packages. These locations make picking up packages more convenient with extended hours, weekend accessibility and security. |
• | UPS My Choice, which focuses on the consignee, has transformed the residential delivery experience. Receivers can direct the timing and circumstances of their deliveries using their computer, mobile devices or a new Facebook app. This innovative service is powered by the complex integration of real-time route optimization and other technologies with our delivery network. Two years after launching UPS My Choice, we now have nearly 7 million members. |
• | UPS Mobile, which includes the mobile website, m.ups.com, and apps for iPhone, iPad, Android and Kindle Fire devices, is readily available for any customer at any time. Customers can track, ship, find UPS locations, manage UPS My Choice shipments and receive shipment notifications with the convenience of their mobile devices. |
• | UPS OrderLink, which allows multiple-marketplace online auction sellers to ship their orders via ups.com. UPS OrderLink provides simplified shipment processing, access to multiple payment options, including PayPal, and access to order and shipment history. |
• | The UPS Developer Kit, which is comprised of multiple Application Programming Interfaces ("APIs"), helps customers streamline and automate their internal business processes. The UPS Developer Kit APIs allow customers to integrate a wide range of UPS functionality into their business systems and websites such as address validation, shipment scheduling, selection of shipping service levels, tracking and much more. |
• | The UPS Billing Center, which is a secure location for customers to view, download, manage and pay their UPS invoices, helps customers accelerate their billing and payment processes. Customers can assign privileges with administrative controls, manage multiple accounts and create reports using a single simple interface. |
• | Continuing to rollout telematics to our delivery (domestic and international), freight forwarding and tractor-trailer fleet. Telematics helps UPS determine a truck’s performance and condition by capturing data on more than 200 elements, including speed, RPM, oil pressure, seat belt use, number of times the vehicle is placed in reverse and idling time. Together, improved data and driver coaching help reduce fuel consumption, emissions and maintenance costs, while improving driver safety. Additionally, customers experience more consistent pickup times and more reliable deliveries, thereby enhancing their profitability and competitiveness. By the end of 2013, telematics had been installed in over 80,000 vehicles. |
• | Implementing our On Road Integrated Optimization and Navigation system (“ORION”), which employs advanced algorithms to determine the optimal route for each delivery while meeting service commitments. |
• | Converting to keyless entry, which enables drivers to remotely turn the engine off with a button that will unlock the bulkhead door at the same time. In 2013, keyless entry had been installed on all package cars. |
• | Ramping up installations of our Next Generation Small Sort (“NGSS”) technology, which reduces the amount of memorization required to sort a package, thereby improving productivity and quality. Employees sort packages to bins tagged with flashing lights, rather than memorizing addresses, allowing us to dramatically reduce training time. |
• | Customers can select from same day, next day, two day and three day delivery alternatives. Many of these services offer options that enable customers to specify a time-of-day guarantee for their delivery (e.g. by 8:30, 10:30, noon, end of day, etc.). |
• | Customers can also leverage our extensive ground network to ship using our day-definite guaranteed ground service that serves every U.S. business and residential address. UPS delivers more ground packages than any other carrier, with nearly 12 million ground packages delivered on time every day in the U.S., most within one to three business days. |
• | UPS also offers UPS SurePost, an economy residential ground service for customers with non-urgent, light weight residential shipments. UPS SurePost is a contractual residential ground service that combines the consistency and reliability of the UPS Ground network with final delivery provided by the U.S. Postal Service. |
• | We offer three guaranteed time-definite express options (Express Plus, Express and Express Saver) to more locations than any other carrier. |
• | In 2013, we introduced UPS Worldwide Express Freight for palletized shipments over 150 pounds from 38 points of origin to 42 points of destination. This service meets the needs of international customers that have palletized freight shipments and require the same speed and reliability as our international express package service. UPS Worldwide Express Freight leverages our unique combination of package and freight networks to provide industry leading transit times with a money-back guarantee. |
• | For international shipments that do not require express services, UPS Worldwide Expedited offers a reliable, deferred, guaranteed day-definite service option. In 2013, we tripled the coverage area for UPS Worldwide Expedited, providing delivery in two-to-five business days to more than 220 countries and territories. This expansion will help UPS customers magnify their global reach and balance delivery speed with cost, no matter where they ship. |
• | For cross-border ground package delivery, we offer UPS Transborder Standard delivery services within Europe, between the U.S. and Canada and between the U.S. and Mexico. |
• | In South and Central America, we benefit from the strong regional economy. Our offerings include express package delivery in major cities as well as distribution and forwarding. |
• | In 2013, we purchased the assets and operations of two Costa Rican based firms: small package delivery company Union Pak de Costa Rica, S.A., and brokerage company SEISA Brokerage. Both companies have long-standing relationships with UPS as Authorized Service Contractors (ASC). These additions will allow us to better connect Costa Rica's expanding economy to regional and world markets through the UPS network. For Costa Rican shippers, UPS will be better positioned to provide customers one source for small package, freight forwarding, brokerage, and contract logistics, with a stronger link to UPS's global transportation network. Access to multi-modal services including ocean and air freight will improve customers' ability to ship across borders, boosting export trade lanes within Latin America and to the U.S. |
• | We continue to grow our business organically in Mexico. We are well positioned with freight, domestic, international and distribution services. We opened ten new UPS Express centers in Mexico, located in strategic zones including Monterrey, Tijuana, Chihuahua, Veracruz, León, and Distrito Federal. These new centers are aimed at increasing our presence among small and medium enterprises and the retail sector. |
• | We became the first global express delivery company to have a wholly-owned subsidiary in Vietnam, following our acquisition of the 49% interest held by VN Post Express in our express delivery joint venture. This change allows us to better connect Vietnam's rapidly expanding economy to world markets through the UPS network. |
• | In February 2012, we broadened our European business-to-consumer service portfolio by acquiring Kiala S.A., a Belgium-based developer of a platform that enables e-commerce retailers to offer consumers the option of having goods delivered to a convenient retail location. |
• | Distribution Services: UPS’s comprehensive distribution services are provided through a global network of distribution centers that manage the flow of goods from receiving to storage and order processing to shipment. UPS also provides many specialized services to streamline supply chains in the health care, high tech, retail and aerospace industries. Together, these services allow companies to save time and money by minimizing their capital investment and positioning products closer to their customers. |
• | Post Sales: Post Sales services support goods after they have been delivered or installed in the field. The four core service offerings within Post Sales include: (1) Critical Parts Fulfillment; (2) Reverse Logistics; (3) Test, Repair, and Refurbish; and (4) Network and Parts Planning. We leverage our global distribution network of over 950 field stocking locations to ensure that the right type and quantity of our customers’ stock is in the right locations to meet the needs of their end-customers. This service allows our customers to maximize service while reducing costs. |
• | UPS Mail Innovations: UPS Mail Innovations offers an efficient, cost-effective method for sending lightweight parcels and flat mail to global addresses from the U.S. We pick up customers’ domestic and international mail, and then sort, post, manifest and expedite the secured mail containers to the destination postal service for last-mile delivery. |
• | UPS, by ensuring strong demand for our services. |
• | The economy, by making global supply chains more efficient and less expensive. |
• | The environment, by enabling our global customers to leverage UPS’s carbon efficiency and thereby reduce the carbon intensity of their supply chains. |
• | Recognized by Fortune Magazine as one of the “World’s Most Admired” companies in 2013. |
• | One of Corporate Responsibility’s “100 Best Corporate Citizens” for the 4th consecutive year. |
• | Recognized by Ethisphere Institute as one of the “World’s Most Ethical Companies”. |
• | Named to Interbrands “Best Global Brands” for the 9th consecutive year. We ranked in the Top 100 in brand value around the world (#27) and were the only company in the transportation sector to make the list in 2013. |
• | Recognized as a constituent of the Dow Jones Sustainability North America Index for the 9th consecutive year; in addition, we were included on the Dow Jones Sustainability World Index for the first time since 2006. |
• | Recognized as a constituent of the NASDAQ OMX and the STOXX NASDAQ OMX Global Sustainability Index for the 4th consecutive year. |
• | One of America’s Top Organizations for Multicultural Business Opportunities by DiversityBusiness.com. |
• | Achieved a score of 99% in response to the Carbon Disclosure Project for the 3rd consecutive year. |
• | Local non-profits around the world received more than 1.8 million hours of volunteer service from UPS employees participating in our Neighbor-to-Neighbor program. |
• | The UPS Foundation, which oversees corporate citizenship efforts for the company, invested $102 million in donations of both cash and in-kind services to global causes primarily in four focus areas—community safety, environmental sustainability, diversity and volunteerism. |
• | UPS employees, both active and retired, contributed $51 million to United Way in 2013 which was matched by a corporate contribution of $8 million. |
• | Through The UPS Foundation we have the opportunity to support our global communities to offset carbon, support clean water, reduce poverty and help individuals sustain their lives through the planting of trees. The UPS Global Tree Planting initiative is the signature program of The UPS Foundation’s Environmental Focus area. In 2013, we supported the planting of 1.3 million trees worldwide. |
• | UPS continued to aid communities impacted by disasters through our UPS Humanitarian Relief program, by providing our logistics expertise, skilled volunteers, capacity building support and in-kind services. In 2013, UPS coordinated more than 250 humanitarian relief shipments across 46 countries and provided funding and logistics support to strengthen long-term recovery efforts of communities impacted by Hurricane Sandy, the Oklahoma Tornados, Typhoon Haiyan in the Philippines, flooding in Colorado, Mexico and India as well as families displaced by the Syrian Refugee Crisis. |
• | Thousands of teenagers and novice drivers in the U.S., Canada, the U.K., and Germany participated in UPS Road Code. This safety program for new drivers features UPS employees as instructors – a role where they share driving knowledge and safety tips amassed over our long history of safe driving. |
• | Personal Value - Which is the foundation and forms the base of our safety and wellness culture. |
• | Management Commitment and Employee Involvement - Where employees take an active role in their own safety as well as their fellow workers and are supported by management. |
• | Work Site Analysis - Which includes injury and auto crash data analysis, behavior observations, and facility and equipment audits to identify gaps and develop solutions. Our operations managers are responsible for their employees' safety results. We investigate every injury and auto crash and develop prevention activities. |
• | Hazard Prevention and Control - Where solutions are developed and documented to ensure identified risks have been mitigated. |
• | Safety Education and Training - Employees who are healthy and well-trained in proper methods are more safe and efficient in performing their jobs. Our approach starts with training the trainer. All trainers are certified to ensure that they have the skills and motivation to effectively instruct new employees. All new employees receive safety training during orientation and in the work area. In addition, each new driver receives extensive classroom and online instruction, as well as on-road training. |
• | Recognition - We have a well-defined safe driving honor plan to recognize our drivers when they achieve accident-free milestones. We have more than 7,200 drivers enshrined in our coveted Circle of Honor for drivers who have driven 25 years or more without an avoidable auto crash. |
• | Preventive Maintenance - We have a comprehensive Preventive Maintenance Program to ensure the safety of our fleet. Our fleet is managed and monitored electronically to ensure that each vehicle is serviced at a specific time to prevent malfunction or breakdown. |
Item 1A. | Risk Factors |
Item 1B. | Unresolved Staff Comments |
Item 2. | Properties |
Description | Owned and Capital Leases | Short-term Leased or Chartered From Others | On Order | Under Option | |||||||
Boeing 747-400F | 11 | — | — | — | |||||||
Boeing 747-400BCF | 2 | — | — | — | |||||||
Boeing 757-200F | 75 | — | — | — | |||||||
Boeing 767-300ERF | 59 | — | — | — | |||||||
Boeing MD-11F | 38 | — | — | — | |||||||
Airbus A300-600F | 52 | — | — | — | |||||||
Other | — | 388 | — | — | |||||||
Total | 237 | 388 | — | — |
Item 3. | Legal Proceedings |
Item 4. | Mine Safety Disclosures |
Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
High | Low | Close | Dividends Declared | ||||||||||||
2013: | |||||||||||||||
First Quarter | $ | 85.92 | $ | 75.03 | $ | 85.90 | $ | 0.62 | |||||||
Second Quarter | $ | 89.96 | $ | 81.95 | $ | 86.48 | $ | 0.62 | |||||||
Third Quarter | $ | 92.10 | $ | 85.18 | $ | 91.37 | $ | 0.62 | |||||||
Fourth Quarter | $ | 105.35 | $ | 88.46 | $ | 105.08 | $ | 0.62 | |||||||
2012: | |||||||||||||||
First Quarter | $ | 81.79 | $ | 72.15 | $ | 80.72 | $ | 0.57 | |||||||
Second Quarter | $ | 80.97 | $ | 72.19 | $ | 78.76 | $ | 0.57 | |||||||
Third Quarter | $ | 80.52 | $ | 71.18 | $ | 71.57 | $ | 0.57 | |||||||
Fourth Quarter | $ | 76.20 | $ | 69.56 | $ | 73.73 | $ | 0.57 |
Total Number of Shares Purchased(1) | Average Price Paid Per Share(1) | Total Number of Shares Purchased as Part of Publicly Announced Program | Approximate Dollar Value of Shares that May Yet be Purchased Under the Program (as of month-end) | ||||||||||
October 1—October 31 | 6.9 | $ | 99.80 | 6.4 | $ | 7,179 | |||||||
November 1—November 30 | 1.2 | 100.87 | 0.7 | 7,106 | |||||||||
December 1—December 31 | 3.0 | 102.51 | 2.9 | 6,814 | |||||||||
Total October 1—December 31 | 11.1 | $ | 100.65 | 10.0 |
(1) | Includes shares repurchased through our publicly announced share repurchase program and shares tendered to pay the exercise price and tax withholding on employee stock options. |
12/31/2008 | 12/31/2009 | 12/31/2010 | 12/31/2011 | 12/31/2012 | 12/31/2013 | ||||||||||||||||||
United Parcel Service, Inc. | $ | 100.00 | $ | 107.75 | $ | 140.39 | $ | 145.84 | $ | 151.44 | $ | 221.91 | |||||||||||
Standard & Poor’s 500 Index | $ | 100.00 | $ | 126.45 | $ | 145.49 | $ | 148.55 | $ | 172.30 | $ | 228.09 | |||||||||||
Dow Jones Transportation Average | $ | 100.00 | $ | 118.59 | $ | 150.30 | $ | 150.31 | $ | 161.56 | $ | 228.42 |
Item 6. | Selected Financial Data |
Years Ended December 31, | |||||||||||||||||||
2013 | 2012 | 2011 | 2010 | 2009 | |||||||||||||||
Selected Income Statement Data | |||||||||||||||||||
Revenue: | |||||||||||||||||||
U.S. Domestic Package | $ | 34,074 | $ | 32,856 | $ | 31,717 | $ | 29,742 | $ | 28,158 | |||||||||
International Package | 12,429 | 12,124 | 12,249 | 11,133 | 9,699 | ||||||||||||||
Supply Chain & Freight | 8,935 | 9,147 | 9,139 | 8,670 | 7,440 | ||||||||||||||
Total revenue | 55,438 | 54,127 | 53,105 | 49,545 | 45,297 | ||||||||||||||
Operating expenses: | |||||||||||||||||||
Compensation and benefits | 28,557 | 33,102 | 27,575 | 26,557 | 25,933 | ||||||||||||||
Other | 19,847 | 19,682 | 19,450 | 17,347 | 15,856 | ||||||||||||||
Total operating expenses | 48,404 | 52,784 | 47,025 | 43,904 | 41,789 | ||||||||||||||
Operating profit: | |||||||||||||||||||
U.S. Domestic Package | 4,603 | 459 | 3,764 | 3,238 | 1,919 | ||||||||||||||
International Package | 1,757 | 869 | 1,709 | 1,831 | 1,279 | ||||||||||||||
Supply Chain and Freight | 674 | 15 | 607 | 572 | 310 | ||||||||||||||
Total operating profit | 7,034 | 1,343 | 6,080 | 5,641 | 3,508 | ||||||||||||||
Other income (expense): | |||||||||||||||||||
Investment income | 20 | 24 | 44 | 3 | 10 | ||||||||||||||
Interest expense | (380 | ) | (393 | ) | (348 | ) | (354 | ) | (445 | ) | |||||||||
Income before income taxes | 6,674 | 974 | 5,776 | 5,290 | 3,073 | ||||||||||||||
Income tax expense | 2,302 | 167 | 1,972 | 1,952 | 1,105 | ||||||||||||||
Net income | $ | 4,372 | $ | 807 | $ | 3,804 | $ | 3,338 | $ | 1,968 | |||||||||
Per share amounts: | |||||||||||||||||||
Basic earnings per share | $ | 4.65 | $ | 0.84 | $ | 3.88 | $ | 3.36 | $ | 1.97 | |||||||||
Diluted earnings per share | $ | 4.61 | $ | 0.83 | $ | 3.84 | $ | 3.33 | $ | 1.96 | |||||||||
Dividends declared per share | $ | 2.48 | $ | 2.28 | $ | 2.08 | $ | 1.88 | $ | 1.80 | |||||||||
Weighted average shares outstanding: | |||||||||||||||||||
Basic | 940 | 960 | 981 | 994 | 998 | ||||||||||||||
Diluted | 948 | 969 | 991 | 1,003 | 1,004 | ||||||||||||||
As of December 31, | |||||||||||||||||||
2013 | 2012 | 2011 | 2010 | 2009 | |||||||||||||||
Selected Balance Sheet Data | |||||||||||||||||||
Cash and marketable securities | $ | 5,245 | $ | 7,924 | $ | 4,275 | $ | 4,081 | $ | 2,100 | |||||||||
Total assets | 36,212 | 38,863 | 34,701 | 33,597 | 31,883 | ||||||||||||||
Long-term debt | 10,824 | 11,089 | 11,095 | 10,491 | 8,668 | ||||||||||||||
Shareowners’ equity | 6,488 | 4,733 | 7,108 | 8,047 | 7,696 |
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Year Ended December 31, | % Change | ||||||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | |||||||||||||
Revenue (in millions) | $ | 55,438 | $ | 54,127 | $ | 53,105 | 2.4 | % | 1.9 | % | |||||||
Operating Expenses (in millions) | 48,404 | 52,784 | 47,025 | (8.3 | )% | 12.2 | % | ||||||||||
Operating Profit (in millions) | $ | 7,034 | $ | 1,343 | $ | 6,080 | N/A | (77.9 | )% | ||||||||
Operating Margin | 12.7 | % | 2.5 | % | 11.4 | % | |||||||||||
Average Daily Package Volume (in thousands) | 16,938 | 16,295 | 15,797 | 3.9 | % | 3.2 | % | ||||||||||
Average Revenue Per Piece | $ | 10.76 | $ | 10.82 | $ | 10.82 | (0.6 | )% | — | % | |||||||
Net Income (in millions) | $ | 4,372 | $ | 807 | $ | 3,804 | N/A | (78.8 | )% | ||||||||
Basic Earnings Per Share | $ | 4.65 | $ | 0.84 | $ | 3.88 | N/A | (78.4 | )% | ||||||||
Diluted Earnings Per Share | $ | 4.61 | $ | 0.83 | $ | 3.84 | N/A | (78.4 | )% |
Year Ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Operating Expenses: | |||||||||||
Defined Benefit Plans Mark-to-Market Charge | $ | — | $ | 4,831 | $ | 827 | |||||
TNT Termination Fee and Related Expenses | 284 | — | — | ||||||||
Gain Upon Liquidation of Foreign Subsidiary | (245 | ) | — | — | |||||||
Multiemployer Pension Plan Withdrawal Charge | — | 896 | — | ||||||||
Gains on Real Estate Transactions | — | — | (33 | ) | |||||||
Income Tax Expense (Benefit) from the Items Above | (75 | ) | (2,145 | ) | (287 | ) |
Year Ended December 31, | ||||||||||||
Components of mark-to-market gain (loss) (in millions) | 2013 | 2012 | 2011 | |||||||||
Discount rates | $ | — | $ | (5,530 | ) | $ | (911 | ) | ||||
Return on assets | — | 708 | 84 | |||||||||
Demographic assumptions | — | (9 | ) | — | ||||||||
Total mark-to-market gain (loss) | $ | — | $ | (4,831 | ) | $ | (827 | ) | ||||
Weighted-average actuarial assumptions used to determine net periodic benefit cost | 2013 | 2012 | 2011 | |||||||||
Expected rate of return on plan assets | 8.69 | % | 8.71 | % | 8.61 | % | ||||||
Actual rate of return on plan assets | 8.36 | % | 11.76 | % | 9.46 | % | ||||||
Discount rate used for net periodic benefit cost | 4.38 | % | 5.58 | % | 5.93 | % | ||||||
Discount rate at measurement date | 5.27 | % | 4.38 | % | 5.58 | % |
• | Discount Rates ($5.530 billion pre-tax loss): The weighted-average discount rate for our U.S. pension and postretirement medical plans and our international pension plans declined from 5.58% at December 31, 2011 to 4.38% at December 31, 2012, due to two primary factors. The discount rate for our U.S. pension and postretirement medical plans is determined using a bond matching approach for a portfolio of corporate AA |
• | Return on Assets ($708 million pre-tax gain): Our expected rate of return on U.S. pension and postretirement medical plan assets is developed taking into consideration: (1) historical plan asset returns over long-term periods, (2) current market conditions, and (3) the mix of asset classes in our investment portfolio. We review the expected rate of return on an annual basis and revise it as appropriate. In 2012, the actual rate of return on plan assets of 11.76% exceeded our expected rate of return of 8.71%, primarily due to strong gains in the world equity markets. |
• | Demographic Assumptions ($9 million pre-tax loss): This represents the difference between actual and estimated demographic factors, including items such as health care cost trends, mortality rates and compensation rate increases. |
Year Ended December 31, | % Change | ||||||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | |||||||||||||
Average Daily Package Volume (in thousands): | |||||||||||||||||
Next Day Air | 1,271 | 1,277 | 1,206 | (0.5 | )% | 5.9 | % | ||||||||||
Deferred | 1,074 | 1,031 | 975 | 4.2 | % | 5.7 | % | ||||||||||
Ground | 12,060 | 11,588 | 11,230 | 4.1 | % | 3.2 | % | ||||||||||
Total Avg. Daily Package Volume | 14,405 | 13,896 | 13,411 | 3.7 | % | 3.6 | % | ||||||||||
Average Revenue Per Piece: | |||||||||||||||||
Next Day Air | $ | 20.12 | $ | 19.93 | $ | 20.33 | 1.0 | % | (2.0 | )% | |||||||
Deferred | 12.70 | 13.06 | 13.32 | (2.8 | )% | (2.0 | )% | ||||||||||
Ground | 7.96 | 7.89 | 7.78 | 0.9 | % | 1.4 | % | ||||||||||
Total Avg. Revenue Per Piece | $ | 9.39 | $ | 9.38 | $ | 9.31 | 0.1 | % | 0.8 | % | |||||||
Operating Days in Period | 252 | 252 | 254 | ||||||||||||||
Revenue (in millions): | |||||||||||||||||
Next Day Air | $ | 6,443 | $ | 6,412 | $ | 6,229 | 0.5 | % | 2.9 | % | |||||||
Deferred | 3,437 | 3,392 | 3,299 | 1.3 | % | 2.8 | % | ||||||||||
Ground | 24,194 | 23,052 | 22,189 | 5.0 | % | 3.9 | % | ||||||||||
Total Revenue | $ | 34,074 | $ | 32,856 | $ | 31,717 | 3.7 | % | 3.6 | % | |||||||
Operating Expenses (in millions): | |||||||||||||||||
Operating Expenses | $ | 29,471 | $ | 32,397 | $ | 27,953 | (9.0 | )% | 15.9 | % | |||||||
Defined Benefit Plans Mark-to-Market Charge | — | (3,177 | ) | (479 | ) | ||||||||||||
Multiemployer Pension Plan Withdrawal Charge | — | (896 | ) | — | |||||||||||||
Gains (Losses) on Real Estate Transactions | — | — | (15 | ) | |||||||||||||
Adjusted Operating Expenses | $ | 29,471 | $ | 28,324 | $ | 27,459 | 4.0 | % | 3.2 | % | |||||||
Operating Profit (in millions) and Operating Margin: | |||||||||||||||||
Operating Profit | $ | 4,603 | $ | 459 | $ | 3,764 | N/A | (87.8 | )% | ||||||||
Adjusted Operating Profit | $ | 4,603 | $ | 4,532 | $ | 4,258 | 1.6 | % | 6.4 | % | |||||||
Operating Margin | 13.5 | % | 1.4 | % | 11.9 | % | |||||||||||
Adjusted Operating Margin | 13.5 | % | 13.8 | % | 13.4 | % |
Volume | Rates / Product Mix | Fuel Surcharge | Total Revenue Change | ||||||||
Revenue Change Drivers: | |||||||||||
2013 / 2012 | 3.7 | % | 0.5 | % | (0.5 | )% | 3.7 | % | |||
2012 / 2011 | 2.8 | % | 0.6 | % | 0.2 | % | 3.6 | % |
Year Ended December 31, | % Point Change | |||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | ||||||||||
Next Day Air / Deferred | 10.7 | % | 13.0 | % | 13.3 | % | (2.3 | )% | (0.3 | )% | ||||
Ground | 7.2 | % | 8.0 | % | 8.0 | % | (0.8 | )% | — | % |
Year Ended December 31, | % Change | ||||||||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | |||||||||||||||
Average Daily Package Volume (in thousands): | |||||||||||||||||||
Domestic | 1,499 | 1,427 | 1,444 | 5.0 | % | (1.2 | )% | ||||||||||||
Export | 1,034 | 972 | 942 | 6.4 | % | 3.2 | % | ||||||||||||
Total Avg. Daily Package Volume | 2,533 | 2,399 | 2,386 | 5.6 | % | 0.5 | % | ||||||||||||
Average Revenue Per Piece: | |||||||||||||||||||
Domestic | $ | 7.06 | $ | 7.04 | $ | 7.17 | 0.3 | % | (1.8 | )% | |||||||||
Export | 35.18 | 36.88 | 37.85 | (4.6 | )% | (2.6 | )% | ||||||||||||
Total Avg. Revenue Per Piece | $ | 18.54 | $ | 19.13 | $ | 19.28 | (3.1 | )% | (0.8 | )% | |||||||||
Operating Days in Period | 252 | 252 | 254 | ||||||||||||||||
Revenue (in millions): | |||||||||||||||||||
Domestic | $ | 2,667 | $ | 2,531 | $ | 2,628 | 5.4 | % | (3.7 | )% | |||||||||
Export | 9,166 | 9,033 | 9,056 | 1.5 | % | (0.3 | )% | ||||||||||||
Cargo | 596 | 560 | 565 | 6.4 | % | (0.9 | )% | ||||||||||||
Total Revenue | $ | 12,429 | $ | 12,124 | $ | 12,249 | 2.5 | % | (1.0 | )% | |||||||||
Operating Expenses (in millions): | |||||||||||||||||||
Operating Expenses | $ | 10,672 | $ | 11,255 | $ | 10,540 | (5.2 | )% | 6.8 | % | |||||||||
TNT Termination Fee and Related Expenses | (284 | ) | — | — | |||||||||||||||
Gain Upon Liquidation of Foreign Subsidiary | 245 | — | — | ||||||||||||||||
Defined Benefit Plan Mark-to-Market Charge | — | (941 | ) | (171 | ) | ||||||||||||||
Adjusted Operating Expenses | $ | 10,633 | $ | 10,314 | $ | 10,369 | 3.1 | % | (0.5 | )% | |||||||||
Operating Profit (in millions) and Operating Margin: | |||||||||||||||||||
Operating Profit | $ | 1,757 | $ | 869 | $ | 1,709 | 102.2 | % | (49.2 | )% | |||||||||
Adjusted Operating Profit | $ | 1,796 | $ | 1,810 | $ | 1,880 | (0.8 | )% | (3.7 | )% | |||||||||
Operating Margin | 14.1 | % | 7.2 | % | 14.0 | % | |||||||||||||
Adjusted Operating Margin | 14.5 | % | 14.9 | % | 15.3 | % | |||||||||||||
Currency Translation Benefit / (Cost)—(in millions)*: | |||||||||||||||||||
Revenue | $ | (65 | ) | $ | (231 | ) | |||||||||||||
Operating Expenses | (37 | ) | 265 | ||||||||||||||||
Operating Profit | $ | (102 | ) | $ | 34 |
* | Net of currency hedging; amount represents the change compared to the prior year. |
Volume | Rates / Product Mix | Fuel Surcharge | Currency | Total Revenue Change | ||||||||||
Revenue Change Drivers: | ||||||||||||||
2013 / 2012 | 5.6 | % | (1.5 | )% | (1.1 | )% | (0.5 | )% | 2.5 | % | ||||
2012 / 2011 | (0.2 | )% | 1.0 | % | 0.1 | % | (1.9 | )% | (1.0 | )% |
Year Ended December 31, | % Change | ||||||||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | |||||||||||||||
Freight LTL Statistics: | |||||||||||||||||||
Revenue (in millions) | $ | 2,502 | $ | 2,377 | $ | 2,299 | 5.3 | % | 3.4 | % | |||||||||
Revenue Per Hundredweight | $ | 22.05 | $ | 21.73 | $ | 21.17 | 1.5 | % | 2.6 | % | |||||||||
Shipments (in thousands) | 10,497 | 10,136 | 10,247 | 3.6 | % | (1.1 | )% | ||||||||||||
Shipments Per Day (in thousands) | 41.5 | 40.1 | 40.5 | 3.6 | % | (1.1 | )% | ||||||||||||
Gross Weight Hauled (in millions of lbs) | 11,348 | 10,939 | 10,858 | 3.7 | % | 0.7 | % | ||||||||||||
Weight Per Shipment (in lbs) | 1,081 | 1,079 | 1,060 | 0.2 | % | 1.8 | % | ||||||||||||
Operating Days in Period | 253 | 253 | 253 | ||||||||||||||||
Revenue (in millions): | |||||||||||||||||||
Forwarding and Logistics | $ | 5,492 | $ | 5,977 | $ | 6,103 | (8.1 | )% | (2.1 | )% | |||||||||
Freight | 2,882 | 2,640 | 2,563 | 9.2 | % | 3.0 | % | ||||||||||||
Other | 561 | 530 | 473 | 5.8 | % | 12.1 | % | ||||||||||||
Total Revenue | $ | 8,935 | $ | 9,147 | $ | 9,139 | (2.3 | )% | 0.1 | % | |||||||||
Operating Expenses (in millions): | |||||||||||||||||||
Operating Expenses | $ | 8,261 | $ | 9,132 | $ | 8,532 | (9.5 | )% | 7.0 | % | |||||||||
Defined Benefit Plans Mark-to-Market Charge | — | (713 | ) | (177 | ) | ||||||||||||||
Gains on Real Estate Transactions | — | — | 48 | ||||||||||||||||
Adjusted Operating Expenses | $ | 8,261 | $ | 8,419 | $ | 8,403 | (1.9 | )% | 0.2 | % | |||||||||
Operating Profit (in millions) and Operating Margins: | |||||||||||||||||||
Operating Profit | $ | 674 | $ | 15 | $ | 607 | N/A | (97.5 | )% | ||||||||||
Adjusted Operating Profit | $ | 674 | $ | 728 | $ | 736 | (7.4 | )% | (1.1 | )% | |||||||||
Operating Margin | 7.5 | % | 0.2 | % | 6.6 | % | |||||||||||||
Adjusted Operating Margin | 7.5 | % | 8.0 | % | 8.1 | % | |||||||||||||
Currency Translation Benefit / (Cost)—(in millions)*: | |||||||||||||||||||
Revenue | $ | (31 | ) | $ | (100 | ) | |||||||||||||
Operating Expenses | 25 | 97 | |||||||||||||||||
Operating Profit | $ | (6 | ) | $ | (3 | ) |
* | Amount represents the change compared to the prior year. |
Year Ended December 31, | % Change | ||||||||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | |||||||||||||||
Operating Expenses (in millions): | |||||||||||||||||||
Compensation and Benefits | $ | 28,557 | $ | 33,102 | $ | 27,575 | (13.7 | )% | 20.0 | % | |||||||||
Defined Benefit Plans Mark-to-Market Charge | — | (4,831 | ) | (827 | ) | ||||||||||||||
Multiemployer Pension Plan Withdrawal Charge | — | (896 | ) | — | |||||||||||||||
Adjusted Compensation and Benefits | 28,557 | 27,375 | 26,748 | 4.3 | % | 2.3 | % | ||||||||||||
Repairs and Maintenance | 1,240 | 1,228 | 1,286 | 1.0 | % | (4.5 | )% | ||||||||||||
Depreciation and Amortization | 1,867 | 1,858 | 1,782 | 0.5 | % | 4.3 | % | ||||||||||||
Purchased Transportation | 7,486 | 7,354 | 7,232 | 1.8 | % | 1.7 | % | ||||||||||||
Fuel | 4,027 | 4,090 | 4,046 | (1.5 | )% | 1.1 | % | ||||||||||||
Other Occupancy | 950 | 902 | 943 | 5.3 | % | (4.3 | )% | ||||||||||||
Other Expenses | 4,277 | 4,250 | 4,161 | 0.6 | % | 2.1 | % | ||||||||||||
TNT Termination Fee and Related Expenses | (284 | ) | — | — | |||||||||||||||
Gain Upon Liquidation of Foreign Subsidiary | 245 | — | — | ||||||||||||||||
Gains on Real Estate Transactions | — | — | 33 | ||||||||||||||||
Adjusted Other Expenses | 4,238 | 4,250 | 4,194 | (0.3 | )% | 1.3 | % | ||||||||||||
Total Operating Expenses | $ | 48,404 | $ | 52,784 | $ | 47,025 | (8.3 | )% | 12.2 | % | |||||||||
Adjusted Total Operating Expenses | $ | 48,365 | $ | 47,057 | $ | 46,231 | 2.8 | % | 1.8 | % | |||||||||
Currency Translation Cost / (Benefit)* | $ | 12 | $ | (362 | ) |
* | Amount represents the change compared to the prior year. |
• | Pension expense increased $300 million in 2013 compared with 2012, due to higher union contribution rates for multiemployer pension plans combined with increased service and interest costs for company-sponsored plans. The increase in service and interest costs for company-sponsored plans was largely due to continued service accruals and lower discount rates. |
• | Vacation, holiday and excused absence expense increased $89 million in 2013 compared with 2012, due to increased vacation entitlements earned based on employees' years of service, higher wage rates and an increase in the overall number of employees during 2013. |
• | Health and welfare costs increased $182 million in 2013 compared with 2012, largely due to increased contribution rates to multiemployer plans, higher medical claims in UPS-sponsored plans, and the impact of several provisions of the Patient Protection and Affordable Care Act of 2010. |
• | The expense associated with our self-insurance programs for worker’s compensation claims decreased $131 million in 2013 compared with 2012. Insurance reserves are established for estimates of the loss that we will ultimately incur on reported worker's compensation claims, as well as estimates of claims that have been incurred but not reported, and take into account a number of factors including our history of claim losses, payroll growth and the impact of safety improvement initiatives. In 2013, we experienced favorable actuarial expense adjustments as the frequency and severity of claims was less than previously projected, due to the impact of ongoing safety improvement and claim management initiatives. |
• | Adjusted pension expense increased $200 million in 2012 compared with 2011, due to higher union contribution rates for multiemployer pension plans combined with increased service and interest costs for company-sponsored plans. The increase in service and interest costs for company-sponsored plans was largely due to continued service accruals and lower discount rates. |
• | Health and welfare costs increased $157 million in 2012 compared with 2011, largely due to higher medical claims and the impact of several provisions of the Patient Protection and Affordable Care Act of 2010. |
• | The expense associated with our self-insurance programs for workers' compensation claims increased $60 million in 2012 compared with 2011. The increase in expense in 2012 was largely impacted by increased payroll estimates, changes in state workers' compensation laws, and medical inflation. |
• | Our U.S. Domestic Package segment incurred a $154 million expense increase for the year, primarily due to higher rates passed to us from rail carriers, and higher fees paid to the U.S. Postal Service associated with the volume growth in our SurePost product. This increase in expense was also impacted by the adverse weather conditions in the fourth quarter of 2013, as well as the significant increase in volume during the compressed timing of the holiday season. |
• | Our International Package segment incurred a $144 million expense increase for the year, primarily due to international volume growth. |
• | Our UPS Freight business incurred a $70 million increase for the year, largely due to growth in LTL volume and higher rates passed to us from rail carriers. |
• | The purchased transportation expense for our forwarding & logistics business declined $236 million for the year, largely due to lower tonnage and reduced rates from third-party transportation carriers in our international air freight forwarding business. |
Year Ended December 31, | % Change | ||||||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | |||||||||||||
Investment Income | $ | 20 | $ | 24 | $ | 44 | (16.7 | )% | (45.5 | )% | |||||||
Interest Expense | $ | (380 | ) | $ | (393 | ) | $ | (348 | ) | (3.3 | )% | 12.9 | % |
Year Ended December 31, | % Change | ||||||||||||||||
2013 | 2012 | 2011 | 2013 / 2012 | 2012 / 2011 | |||||||||||||
Income Tax Expense | $ | 2,302 | $ | 167 | $ | 1,972 | N/A | (91.5 | )% | ||||||||
Income Tax Impact of: | |||||||||||||||||
TNT Termination Fee and Related Expenses | 107 | — | — | ||||||||||||||
Gain Upon Liquidation of Foreign Subsidiary | (32 | ) | — | — | |||||||||||||
Defined Benefit Plans Mark-to-Market Charge | — | 1,808 | 300 | ||||||||||||||
Multiemployer Pension Plan Withdrawal Charge | — | 337 | — | ||||||||||||||
Gain on Real Estate Transactions | — | — | (13 | ) | |||||||||||||
Adjusted Income Tax Expense | $ | 2,377 | $ | 2,312 | $ | 2,259 | 2.8 | % | 2.3 | % | |||||||
Effective Tax Rate | 34.5 | % | 17.1 | % | 34.1 | % | |||||||||||
Adjusted Effective Tax Rate | 35.4 | % | 34.5 | % | 34.4 | % |
2013 | 2012 | 2011 | |||||||||
Net income | $ | 4,372 | $ | 807 | $ | 3,804 | |||||
Non-cash operating activities(a) | 3,318 | 7,313 | 4,578 | ||||||||
Pension and postretirement plan contributions (UPS-sponsored plans) | (212 | ) | (917 | ) | (1,436 | ) | |||||
Income tax receivables and payables | (155 | ) | 280 | 236 | |||||||
Changes in working capital and other noncurrent assets and liabilities | 121 | (148 | ) | (12 | ) | ||||||
Other operating activities | (140 | ) | (119 | ) | (97 | ) | |||||
Net cash from operating activities | $ | 7,304 | $ | 7,216 | $ | 7,073 |
(a) | Represents depreciation and amortization, gains and losses on derivative and foreign exchange transactions, deferred income taxes, provisions for uncollectible accounts, pension and postretirement benefit expense, stock compensation expense, impairment charges and other non-cash items. |
• | In 2013, we did not have any required, nor make any discretionary, contributions to our primary company-sponsored pension plans in the U.S. |
• | In 2012, we made a $355 million required contribution to the UPS IBT Pension Plan. |
• | In 2011, we made a $1.2 billion contribution to the UPS IBT Pension Plan, which satisfied our 2011 contribution requirements and also approximately $440 million in contributions that would not have been required until after 2011. |
• | The remaining contributions in the 2011 through 2013 period were largely due to contributions to our international pension plans and U.S. postretirement medical benefit plans. |
2013 | 2012 | 2011 | |||||||||
Net cash used in investing activities | $ | (2,114 | ) | $ | (1,335 | ) | $ | (2,537 | ) | ||
Capital Expenditures: | |||||||||||
Buildings and facilities | $ | (483 | ) | $ | (506 | ) | $ | (373 | ) | ||
Aircraft and parts | (478 | ) | (568 | ) | (598 | ) | |||||
Vehicles | (662 | ) | (672 | ) | (659 | ) | |||||
Information technology | (442 | ) | (407 | ) | (375 | ) | |||||
$ | (2,065 | ) | $ | (2,153 | ) | $ | (2,005 | ) | |||
Capital Expenditures as a % of Revenue | 3.7 | % | 4.0 | % | 3.8 | % | |||||
Other Investing Activities: | |||||||||||
Proceeds from disposals of property, plant and equipment | $ | 104 | $ | 95 | $ | 27 | |||||
Net decrease in finance receivables | $ | 39 | $ | 101 | $ | 184 | |||||
Net (purchases) sales of marketable securities | $ | 9 | $ | 628 | $ | (413 | ) | ||||
Cash received (paid) for business acquisitions and dispositions | $ | (22 | ) | $ | (100 | ) | $ | (73 | ) | ||
Other investing activities | $ | (179 | ) | $ | 94 | $ | (257 | ) |
2013 | 2012 | 2011 | |||||||||
Net cash used in financing activities | $ | (7,807 | ) | $ | (1,817 | ) | $ | (4,862 | ) | ||
Share Repurchases: | |||||||||||
Cash expended for shares repurchased | $ | (3,838 | ) | $ | (1,621 | ) | $ | (2,665 | ) | ||
Number of shares repurchased | (43.2 | ) | (21.8 | ) | (38.7 | ) | |||||
Shares outstanding at year-end | 923 | 953 | 963 | ||||||||
Percent reduction in shares outstanding | (3.1 | )% | (1.0 | )% | (2.8 | )% | |||||
Dividends: | |||||||||||
Dividends declared per share | $ | 2.48 | $ | 2.28 | $ | 2.08 | |||||
Cash expended for dividend payments | $ | (2,260 | ) | $ | (2,130 | ) | $ | (1,997 | ) | ||
Borrowings: | |||||||||||
Net borrowings (repayments) of debt principal | $ | (1,775 | ) | $ | 1,729 | $ | (95 | ) | |||
Other Financing Activities: | |||||||||||
Cash received for common stock issuances | $ | 491 | $ | 301 | $ | 290 | |||||
Other financing activities | $ | (425 | ) | $ | (96 | ) | $ | (395 | ) | ||
Capitalization: | |||||||||||
Total debt outstanding at year-end | $ | 10,872 | $ | 12,870 | $ | 11,128 | |||||
Total shareowners’ equity at year-end | 6,488 | 4,733 | 7,108 | ||||||||
Total capitalization | $ | 17,360 | $ | 17,603 | $ | 18,236 | |||||
Debt to Total Capitalization % | 62.6 | % | 73.1 | % | 61.0 | % |
Commitment Type | 2014 | 2015 | 2016 | 2017 | 2018 | After 2018 | Total | ||||||||||||||||||||
Capital Leases | $ | 67 | $ | 65 | $ | 58 | $ | 58 | $ | 53 | $ | 422 | $ | 723 | |||||||||||||
Operating Leases | 310 | 239 | 180 | 146 | 99 | 242 | 1,216 | ||||||||||||||||||||
Debt Principal | 1,009 | 107 | 6 | 377 | 750 | 8,030 | 10,279 | ||||||||||||||||||||
Debt Interest | 301 | 294 | 294 | 293 | 282 | 4,519 | 5,983 | ||||||||||||||||||||
Purchase Commitments | 333 | 100 | 50 | 11 | — | — | 494 | ||||||||||||||||||||
Pension Fundings | — | 687 | 1,137 | 1,082 | 1,055 | 2,259 | 6,220 | ||||||||||||||||||||
Other Liabilities | 58 | 43 | 23 | 10 | 5 | — | 139 | ||||||||||||||||||||
Total | $ | 2,078 | $ | 1,535 | $ | 1,748 | $ | 1,977 | $ | 2,244 | $ | 15,472 | $ | 25,054 |
• | The old pool of the New England Pension Fund has historically had, and would likely continue to have, funding challenges; this represented a risk to UPS of having to face higher future contribution requirements, as well as a risk to the security of the pension benefits of those UPS employees who participate in the New England Pension Fund. The 50 year fixed payment obligation should improve the funded status of the New England Pension Fund over time, while reducing the risk to UPS of significantly higher future contribution requirements. |
• | The newly-established pool provides better protections for new participating employers. This pool uses a direct-attribution methodology for calculating any potential future withdrawal liabilities, which reduces our exposure to the liabilities of other participating employers. Additionally, this pool contains provisions designed to maintain a fully-funded status, including automatic benefit reductions and/or increased employee contributions in the event of an underfunded situation occurring. |
• | As part of the agreement, we were able to freeze our hourly pension contribution rate to the newly-established pool of the New England Pension Fund for a period of 10 years, which provides cash flow visibility for both UPS and the New England Pension Fund. |
• | UPS Ground services; |
• | UPS Next Day Air, UPS 2nd Day Air, UPS 3 Day Select, and international air shipments originating in the United States (including Worldwide Express, Worldwide Express Plus, UPS Worldwide Expedited and UPS International Standard Service); |
• | UPS Next Day Air Freight, UPS 2nd Day Air Freight, and UPS 3 Day Freight shipments within and between the U.S., Canada, and Puerto Rico; and |
• | UPS Express Freight shipments originating in the U.S. |
Pension Plans | 25 Basis Point Increase | 25 Basis Point Decrease | |||||
Discount Rate: | |||||||
Effect on ongoing net periodic benefit cost | $ | (62 | ) | $ | 63 | ||
Effect on net periodic benefit cost for amounts recognized outside the 10% corridor | (193 | ) | 24 | ||||
Effect on projected benefit obligation | (1,161 | ) | 1,231 | ||||
Return on Assets: | |||||||
Effect on ongoing net periodic benefit cost(1) | (63 | ) | 63 | ||||
Effect on net periodic benefit cost for amounts recognized outside the 10% corridor(2) | (1 | ) | 1 | ||||
Postretirement Medical Plans | |||||||
Discount Rate: | |||||||
Effect on ongoing net periodic benefit cost | 1 | (1 | ) | ||||
Effect on net periodic benefit cost for amounts recognized outside the 10% corridor | — | — | |||||
Effect on accumulated postretirement benefit obligation | (101 | ) | 105 | ||||
Health Care Cost Trend Rate: | |||||||
Effect on ongoing net periodic benefit cost | 1 | (1 | ) | ||||
Effect on accumulated postretirement benefit obligation | 13 | (14 | ) |
(1) | Amount calculated based on 25 basis point increase / decrease in the expected return on assets. |
(2) | Amount calculated based on 25 basis point increase / decrease in the actual return on assets. |
Item 7A. | Quantitative and Qualitative Disclosures about Market Risk |
Shock-Test Result As of December 31, | |||||||
(in millions) | 2013 | 2012 | |||||
Change in Fair Value: | |||||||
Currency Derivatives(1) | $ | (291 | ) | $ | (1 | ) | |
Change in Annual Interest Expense: | |||||||
Variable Rate Debt(2) | $ | 7 | $ | 7 | |||
Interest Rate Derivatives(2) | $ | 101 | $ | 106 | |||
Change in Annual Interest Income: | |||||||
Marketable Securities(3) | $ | 15 | $ | 10 |
(1) | The potential change in fair value from a hypothetical 10% weakening of the U.S. Dollar against local currency exchange rates across all maturities. |
(2) | The potential change in annual interest expense resulting from a hypothetical 100 basis point increase in short-term interest rates, applied to our variable rate debt and swap instruments (excluding hedges of anticipated debt issuances). |
(3) | The potential change in interest income resulting from a hypothetical 100 basis point increase in short-term interest rates, applied to our variable rate investment holdings. |
Item 8. | Financial Statements and Supplementary Data |
December 31, | |||||||
2013 | 2012 | ||||||
ASSETS | |||||||
Current Assets: | |||||||
Cash and cash equivalents | $ | 4,665 | $ | 7,327 | |||
Marketable securities | 580 | 597 | |||||
Accounts receivable, net | 6,502 | 6,111 | |||||
Deferred income tax assets | 684 | 583 | |||||
Other current assets | 956 | 973 | |||||
Total Current Assets | 13,387 | 15,591 | |||||
Property, Plant and Equipment, Net | 17,961 | 17,894 | |||||
Goodwill | 2,190 | 2,173 | |||||
Intangible Assets, Net | 775 | 603 | |||||
Investments and Restricted Cash | 444 | 307 | |||||
Derivative Assets | 323 | 535 | |||||
Deferred Income Tax Assets | 110 | 684 | |||||
Other Non-Current Assets | 1,022 | 1,076 | |||||
Total Assets | $ | 36,212 | $ | 38,863 | |||
LIABILITIES AND SHAREOWNERS’ EQUITY | |||||||
Current Liabilities: | |||||||
Current maturities of long-term debt and commercial paper | $ | 48 | $ | 1,781 | |||
Accounts payable | 2,478 | 2,278 | |||||
Accrued wages and withholdings | 2,325 | 1,927 | |||||
Self-insurance reserves | 719 | 763 | |||||
Other current liabilities | 1,561 | 1,641 | |||||
Total Current Liabilities | 7,131 | 8,390 | |||||
Long-Term Debt | 10,824 | 11,089 | |||||
Pension and Postretirement Benefit Obligations | 7,051 | 11,068 | |||||
Deferred Income Tax Liabilities | 1,244 | 48 | |||||
Self-Insurance Reserves | 2,059 | 1,980 | |||||
Other Non-Current Liabilities | 1,415 | 1,555 | |||||
Shareowners’ Equity: | |||||||
Class A common stock (212 and 225 shares issued in 2013 and 2012) | 2 | 3 | |||||
Class B common stock (712 and 729 shares issued in 2013 and 2012) | 7 | 7 | |||||
Additional paid-in capital | — | — | |||||
Retained earnings | 6,925 | 7,997 | |||||
Accumulated other comprehensive loss | (460 | ) | (3,354 | ) | |||
Deferred compensation obligations | 69 | 78 | |||||
Less: Treasury stock (1 share in 2013 and 2012) | (69 | ) | (78 | ) | |||
Total Equity for Controlling Interests | 6,474 | 4,653 | |||||
Noncontrolling Interests | 14 | 80 | |||||
Total Shareowners’ Equity | 6,488 | 4,733 | |||||
Total Liabilities and Shareowners’ Equity | $ | 36,212 | $ | 38,863 |
Years Ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Revenue | $ | 55,438 | $ | 54,127 | $ | 53,105 | |||||
Operating Expenses: | |||||||||||
Compensation and benefits | 28,557 | 33,102 | 27,575 | ||||||||
Repairs and maintenance | 1,240 | 1,228 | 1,286 | ||||||||
Depreciation and amortization | 1,867 | 1,858 | 1,782 | ||||||||
Purchased transportation | 7,486 | 7,354 | 7,232 | ||||||||
Fuel | 4,027 | 4,090 | 4,046 | ||||||||
Other occupancy | 950 | 902 | 943 | ||||||||
Other expenses | 4,277 | 4,250 | 4,161 | ||||||||
Total Operating Expenses | 48,404 | 52,784 | 47,025 | ||||||||
Operating Profit | 7,034 | 1,343 | 6,080 | ||||||||
Other Income and (Expense): | |||||||||||
Investment income | 20 | 24 | 44 | ||||||||
Interest expense | (380 | ) | (393 | ) | (348 | ) | |||||
Total Other Income and (Expense) | (360 | ) | (369 | ) | (304 | ) | |||||
Income Before Income Taxes | 6,674 | 974 | 5,776 | ||||||||
Income Tax Expense | 2,302 | 167 | 1,972 | ||||||||
Net Income | $ | 4,372 | $ | 807 | $ | 3,804 | |||||
Basic Earnings Per Share | $ | 4.65 | $ | 0.84 | $ | 3.88 | |||||
Diluted Earnings Per Share | $ | 4.61 | $ | 0.83 | $ | 3.84 |
Years Ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Net income | $ | 4,372 | $ | 807 | $ | 3,804 | |||||
Change in foreign currency translation adjustment, net of tax | (260 | ) | 294 | (92 | ) | ||||||
Change in unrealized gain (loss) on marketable securities, net of tax | (7 | ) | — | (6 | ) | ||||||
Change in unrealized gain (loss) on cash flow hedges, net of tax | 67 | (82 | ) | 35 | |||||||
Change in unrecognized pension and postretirement benefit costs, net of tax | 3,094 | (463 | ) | (405 | ) | ||||||
Comprehensive income | $ | 7,266 | $ | 556 | $ | 3,336 |
Years Ended December 31, | |||||||||||
2013 | 2012 | 2011 | |||||||||
Cash Flows From Operating Activities: | |||||||||||
Net income | $ | 4,372 | $ | 807 | $ | 3,804 | |||||
Adjustments to reconcile net income to net cash from operating activities: | |||||||||||
Depreciation and amortization | 1,867 | 1,858 | 1,782 | ||||||||
Pension and postretirement benefit expense | 1,115 | 5,753 | 1,660 | ||||||||
Pension and postretirement benefit contributions | (212 | ) | (917 | ) | (1,436 | ) | |||||
Self-insurance reserves | 34 | 156 | 53 | ||||||||
Deferred tax expense | (246 | ) | (2,083 | ) | 314 | ||||||
Stock compensation expense | 513 | 547 | 524 | ||||||||
Other (gains) losses | 35 | 1,082 | 245 | ||||||||
Changes in assets and liabilities, net of effect of acquisitions: | |||||||||||
Accounts receivable | (515 | ) | (124 | ) | (657 | ) | |||||
Other current assets | (13 | ) | 10 | 107 | |||||||
Accounts payable | 218 | (58 | ) | 249 | |||||||
Accrued wages and withholdings | 416 | 98 | 339 | ||||||||
Other current liabilities | (140 | ) | 206 | 186 | |||||||
Other operating activities | (140 | ) | (119 | ) | (97 | ) | |||||
Net cash from operating activities | 7,304 | 7,216 | 7,073 | ||||||||
Cash Flows From Investing Activities: | |||||||||||
Capital expenditures | (2,065 | ) | (2,153 | ) | (2,005 | ) | |||||
Proceeds from disposals of property, plant and equipment | 104 | 95 | 27 | ||||||||
Purchases of marketable securities | (2,948 | ) | (2,357 | ) | (4,903 | ) | |||||
Sales and maturities of marketable securities | 2,957 | 2,985 | 4,490 | ||||||||
Net decrease in finance receivables | 39 | 101 | 184 | ||||||||
Cash received (paid) for business acquisitions and dispositions | (22 | ) | (100 | ) | (73 | ) | |||||
Other investing activities | (179 | ) | 94 | (257 | ) | ||||||
Net cash used in investing activities | (2,114 | ) | (1,335 | ) | (2,537 | ) | |||||
Cash Flows From Financing Activities: | |||||||||||
Net change in short-term debt | — | — | (183 | ) | |||||||
Proceeds from long-term borrowings | 100 | 1,745 | 279 | ||||||||
Repayments of long-term borrowings | (1,875 | ) | (16 | ) | (191 | ) | |||||
Purchases of common stock | (3,838 | ) | (1,621 | ) | (2,665 | ) | |||||
Issuances of common stock | 491 | 301 | 290 | ||||||||
Dividends | (2,260 | ) | (2,130 | ) | (1,997 | ) | |||||
Other financing activities | (425 | ) | (96 | ) | (395 | ) | |||||
Net cash used in financing activities | (7,807 | ) | (1,817 | ) | (4,862 | ) | |||||
Effect Of Exchange Rate Changes On Cash And Cash Equivalents | (45 | ) | 229 | (10 | ) | ||||||
Net Increase (Decrease) In Cash And Cash Equivalents | (2,662 | ) | 4,293 | (336 | ) | ||||||
Cash And Cash Equivalents: | |||||||||||
Beginning of period | 7,327 | 3,034 | 3,370 | ||||||||
End of period | $ | 4,665 | $ | 7,327 | $ | 3,034 | |||||
Cash Paid During The Period For: | |||||||||||
Interest (net of amount capitalized) | $ | 409 | $ | 381 | $ | 248 | |||||
Income taxes | $ | 2,712 | $ | 1,988 | $ | 1,527 |
Cost | Unrealized Gains | Unrealized Losses | Estimated Fair Value | ||||||||||||
2013 | |||||||||||||||
Current marketable securities: | |||||||||||||||
U.S. government and agency debt securities | $ | 355 | $ | — | $ | (1 | ) | $ | 354 | ||||||
Mortgage and asset-backed debt securities | 76 | 1 | (2 | ) | 75 | ||||||||||
Corporate debt securities | 146 | 1 | (1 | ) | 146 | ||||||||||
U.S. state and local municipal debt securities | 2 | — | — | 2 | |||||||||||
Other debt and equity securities | 3 | — | — | 3 | |||||||||||
Total marketable securities | $ | 582 | $ | 2 | $ | (4 | ) | $ | 580 | ||||||
Cost | Unrealized Gains | Unrealized Losses | Estimated Fair Value | ||||||||||||
2012 | |||||||||||||||
Current marketable securities: | |||||||||||||||
U.S. government and agency debt securities | $ | 236 | $ | 2 | $ | — | $ | 238 | |||||||
Mortgage and asset-backed debt securities | 171 | 3 | — | 174 | |||||||||||
Corporate debt securities | 158 | 5 | — | 163 | |||||||||||
U.S. state and local municipal debt securities | 15 | — | — | 15 | |||||||||||
Other debt and equity securities | 7 | — | — | 7 | |||||||||||
Total marketable securities | $ | 587 | $ | 10 | $ | — | $ | 597 |
Less Than 12 Months | 12 Months or More | Total | |||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||
U.S. government and agency debt securities | $ | 183 | $ | (1 | ) | $ | — | $ | — | $ | 183 | $ | (1 | ) | |||||||||
Mortgage and asset-backed debt securities | 50 | (2 | ) | 4 | — | 54 | (2 | ) | |||||||||||||||
Corporate debt securities | 47 | (1 | ) | — | — | 47 | (1 | ) | |||||||||||||||
U.S. state and local municipal debt securities | — | — | — | — | — | — | |||||||||||||||||
Other debt and equity securities | — | — | — | — | — | — | |||||||||||||||||
Total marketable securities | $ | 280 | $ | (4 | ) | $ | 4 | $ | — | $ | 284 | $ | (4 | ) |
Cost | Estimated Fair Value | ||||||
Due in one year or less | $ | 33 | $ | 33 | |||
Due after one year through three years | 432 | 432 | |||||
Due after three years through five years | 21 | 21 | |||||
Due after five years | 93 | 91 | |||||
579 | 577 | ||||||
Equity securities | 3 | 3 | |||||
$ | 582 | $ | 580 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
2013 | |||||||||||||||
Marketable securities: | |||||||||||||||
U.S. government and agency debt securities | $ | 353 | $ | 1 | $ | — | $ | 354 | |||||||
Mortgage and asset-backed debt securities | — | 75 | — | 75 | |||||||||||
Corporate debt securities | — | 146 | — | 146 | |||||||||||
U.S. state and local municipal debt securities | — | 2 | — | 2 | |||||||||||
Other debt and equity securities | — | 3 | — | 3 | |||||||||||
Total marketable securities | 353 | 227 | — | 580 | |||||||||||
Other investments | 19 | — | 110 | 129 | |||||||||||
Total | $ | 372 | $ | 227 | $ | 110 | $ | 709 | |||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
2012 | |||||||||||||||
Marketable securities: | |||||||||||||||
U.S. government and agency debt securities | $ | 237 | $ | 1 | $ | — | $ | 238 | |||||||
Mortgage and asset-backed debt securities | — | 174 | — | 174 | |||||||||||
Corporate debt securities | — | 163 | — | 163 | |||||||||||
U.S. state and local municipal debt securities | — | 15 | — | 15 | |||||||||||
Other debt and equity securities | — | 7 | — | 7 | |||||||||||
Total marketable securities | 237 | 360 | — | 597 | |||||||||||
Other investments | 19 | — | 163 | 182 | |||||||||||
Total | $ | 256 | $ | 360 | $ | 163 | $ | 779 |
Marketable Securities | Other Investments | Total | |||||||||
Balance on January 1, 2012 | $ | — | $ | 217 | $ | 217 | |||||
Transfers into (out of) Level 3 | — | — | — | ||||||||
Net realized and unrealized gains (losses): | |||||||||||
Included in earnings (in investment income) | — | (54 | ) | (54 | ) | ||||||
Included in accumulated other comprehensive income (pre-tax) | — | — | — | ||||||||
Purchases | — | — | — | ||||||||
Settlements | — | — | — | ||||||||
Balance on December 31, 2012 | $ | — | $ | 163 | $ | 163 | |||||
Transfers into (out of) Level 3 | — | — | — | ||||||||
Net realized and unrealized gains (losses): | |||||||||||
Included in earnings (in investment income) | — | (53 | ) | (53 | ) | ||||||
Included in accumulated other comprehensive income (pre-tax) | — | — | — | ||||||||
Purchases | — | — | — | ||||||||
Settlements | — | — | — | ||||||||
Balance on December 31, 2013 | $ | — | $ | 110 | $ | 110 |
2013 | 2012 | ||||||
Vehicles | $ | 6,762 | $ | 6,344 | |||
Aircraft | 15,772 | 15,164 | |||||
Land | 1,163 | 1,122 | |||||
Buildings | 3,260 | 3,138 | |||||
Building and leasehold improvements | 3,116 | 3,049 | |||||
Plant equipment | 7,221 | 7,010 | |||||
Technology equipment | 1,569 | 1,675 | |||||
Equipment under operating leases | 44 | 69 | |||||
Construction-in-progress | 244 | 470 | |||||
39,151 | 38,041 | ||||||
Less: Accumulated depreciation and amortization | (21,190 | ) | (20,147 | ) | |||
$ | 17,961 | $ | 17,894 |
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | |||||||||||||||||||||||||||||||||
2013 | 2012 | 2011 | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||||||||||||
Net Periodic Cost: | |||||||||||||||||||||||||||||||||||
Service cost | $ | 1,349 | $ | 998 | $ | 870 | $ | 103 | $ | 89 | $ | 89 | $ | 47 | $ | 41 | $ | 34 | |||||||||||||||||
Interest cost | 1,449 | 1,410 | 1,309 | 185 | 208 | 207 | 44 | 41 | 39 | ||||||||||||||||||||||||||
Expected return on assets | (2,147 | ) | (1,970 | ) | (1,835 | ) | (33 | ) | (18 | ) | (16 | ) | (55 | ) | (47 | ) | (43 | ) | |||||||||||||||||
Amortization of: | |||||||||||||||||||||||||||||||||||
Transition obligation | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Prior service cost | 172 | 173 | 171 | 4 | 5 | 7 | 2 | 2 | 1 | ||||||||||||||||||||||||||
Actuarial (gain) loss | — | 4,388 | 736 | — | 374 | — | — | 69 | 91 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | (5 | ) | (10 | ) | — | ||||||||||||||||||||||||
Net periodic benefit cost | $ | 823 | $ | 4,999 | $ | 1,251 | $ | 259 | $ | 658 | $ | 287 | $ | 33 | $ | 96 | $ | 122 |
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | ||||||||||||||||||||||||
2013 | 2012 | 2011 | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | ||||||||||||||||||
Discount rate | 4.42 | % | 5.64 | % | 5.98 | % | 4.21 | % | 5.47 | % | 5.77 | % | 4.00 | % | 4.63 | % | 5.36 | % | ||||||||
Rate of compensation increase | 4.16 | % | 4.50 | % | 4.50 | % | N/A | N/A | N/A | 3.03 | % | 3.58 | % | 3.57 | % | |||||||||||
Expected return on assets | 8.75 | % | 8.75 | % | 8.75 | % | 8.75 | % | 8.75 | % | 8.75 | % | 6.90 | % | 7.20 | % | 7.31 | % |
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | |||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Discount rate | 5.32 | % | 4.42 | % | 5.14 | % | 4.21 | % | 4.40 | % | 4.00 | % | |||||
Rate of compensation increase | 4.29 | % | 4.16 | % | N/A | N/A | 3.30 | % | 3.03 | % |
Increase (Decrease) in the Projected Benefit Obligation | |||||||
Pension Benefits | Postretirement Medical Benefits | ||||||
One basis point increase in discount rate | $ | (46 | ) | $ | (4 | ) | |
One basis point decrease in discount rate | $ | 49 | $ | 4 |
1% Increase | 1% Decrease | ||||||
Effect on total of service cost and interest cost | $ | 3 | $ | (3 | ) | ||
Effect on postretirement benefit obligation | $ | 50 | $ | (64 | ) |
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | |||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Funded Status: | |||||||||||||||||||||||
Fair value of plan assets | $ | 26,224 | $ | 24,941 | $ | 355 | $ | 460 | $ | 931 | $ | 801 | |||||||||||
Benefit obligation | (29,508 | ) | (31,868 | ) | (4,046 | ) | (4,412 | ) | (1,076 | ) | (1,089 | ) | |||||||||||
Funded status recognized at December 31 | $ | (3,284 | ) | $ | (6,927 | ) | $ | (3,691 | ) | $ | (3,952 | ) | $ | (145 | ) | $ | (288 | ) | |||||
Funded Status Amounts Recognized in our Balance Sheet: | |||||||||||||||||||||||
Other non-current assets | $ | — | $ | — | $ | — | $ | — | $ | 47 | $ | 26 | |||||||||||
Other current liabilities | (16 | ) | (14 | ) | (97 | ) | (108 | ) | (3 | ) | (3 | ) | |||||||||||
Pension and postretirement benefit obligations | (3,268 | ) | (6,913 | ) | (3,594 | ) | (3,844 | ) | (189 | ) | (311 | ) | |||||||||||
Net liability at December 31 | $ | (3,284 | ) | $ | (6,927 | ) | $ | (3,691 | ) | $ | (3,952 | ) | $ | (145 | ) | $ | (288 | ) | |||||
Amounts Recognized in AOCI: | |||||||||||||||||||||||
Unrecognized net prior service cost | $ | (1,286 | ) | $ | (1,318 | ) | $ | (79 | ) | $ | (79 | ) | $ | (9 | ) | $ | (13 | ) | |||||
Unrecognized net actuarial gain (loss) | 1,233 | (3,187 | ) | (29 | ) | (441 | ) | (7 | ) | (86 | ) | ||||||||||||
Gross unrecognized cost at December 31 | (53 | ) | (4,505 | ) | (108 | ) | (520 | ) | (16 | ) | (99 | ) | |||||||||||
Deferred tax asset at December 31 | 20 | 1,694 | 41 | 196 | 2 | 26 | |||||||||||||||||
Net unrecognized cost at December 31 | $ | (33 | ) | $ | (2,811 | ) | $ | (67 | ) | $ | (324 | ) | $ | (14 | ) | $ | (73 | ) |
Projected Benefit Obligation Exceeds the Fair Value of Plan Assets | Accumulated Benefit Obligation Exceeds the Fair Value of Plan Assets | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
U.S. Pension Benefits | |||||||||||||||
Projected benefit obligation | $ | 29,508 | $ | 31,868 | $ | 29,508 | $ | 31,868 | |||||||
Accumulated benefit obligation | 27,623 | 29,382 | 27,623 | 29,382 | |||||||||||
Fair value of plan assets | 26,224 | 24,941 | 26,224 | 24,941 | |||||||||||
International Pension Benefits | |||||||||||||||
Projected benefit obligation | $ | 764 | $ | 1,028 | $ | 361 | $ | 678 | |||||||
Accumulated benefit obligation | 658 | 917 | 301 | 606 | |||||||||||
Fair value of plan assets | 580 | 723 | 184 | 388 |
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | |||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Benefit Obligations: | |||||||||||||||||||||||
Projected benefit obligation at beginning of year | $ | 31,868 | $ | 24,386 | $ | 4,412 | $ | 3,836 | $ | 1,089 | $ | 841 | |||||||||||
Service cost | 1,349 | 998 | 103 | 89 | 47 | 41 | |||||||||||||||||
Interest cost | 1,449 | 1,410 | 185 | 208 | 44 | 41 | |||||||||||||||||
Gross benefits paid | (813 | ) | (774 | ) | (258 | ) | (233 | ) | (21 | ) | (20 | ) | |||||||||||
Plan participants’ contributions | — | — | 17 | 16 | 4 | 4 | |||||||||||||||||
Plan amendments | 140 | (2 | ) | 4 | 1 | — | — | ||||||||||||||||
Actuarial (gain)/loss | (4,485 | ) | 5,850 | (417 | ) | 495 | (55 | ) | 112 | ||||||||||||||
Foreign currency exchange rate changes | — | — | — | — | (26 | ) | 24 | ||||||||||||||||
Curtailments and settlements | — | — | — | — | (6 | ) | (5 | ) | |||||||||||||||
Other | — | — | — | — | — | 51 | |||||||||||||||||
Projected benefit obligation at end of year | $ | 29,508 | $ | 31,868 | $ | 4,046 | $ | 4,412 | $ | 1,076 | $ | 1,089 | |||||||||||
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | |||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Fair Value of Plan Assets: | |||||||||||||||||||||||
Fair value of plan assets at beginning of year | $ | 24,941 | $ | 22,663 | $ | 460 | $ | 174 | $ | 801 | $ | 613 | |||||||||||
Actual return on plan assets | 2,082 | 2,684 | 28 | 19 | 81 | 56 | |||||||||||||||||
Employer contributions | 14 | 368 | 108 | 475 | 90 | 74 | |||||||||||||||||
Plan participants’ contributions | — | — | 17 | 16 | 1 | 1 | |||||||||||||||||
Gross benefits paid | (813 | ) | (774 | ) | (258 | ) | (233 | ) | (21 | ) | (20 | ) | |||||||||||
Foreign currency exchange rate changes | — | — | — | — | (20 | ) | 20 | ||||||||||||||||
Curtailments and settlements | — | — | — | — | (1 | ) | (4 | ) | |||||||||||||||
Other | — | — | — | 9 | — | 61 | |||||||||||||||||
Fair value of plan assets at end of year | $ | 26,224 | $ | 24,941 | $ | 355 | $ | 460 | $ | 931 | $ | 801 |
• | Commingled Stock Funds: We maintain plan assets invested in commingled stock funds, which hold U.S. and international public market securities. These commingled funds are valued using net asset values, adjusted, as appropriate, for investment fund specific inputs determined to be significant to the valuation. Our plans maintain the right to liquidate positions in these commingled stock funds at any time, subject only to a brief notification period. No unfunded commitments existed with respect to these commingled stock funds at December 31, 2013. |
• | Hedge Funds: We maintain plan assets invested in hedge funds that pursue multiple strategies to diversify risk and reduce volatility. Investments in hedge funds are valued using reported net asset values as of December 31. These assets are primarily invested in a portfolio of diversified, direct investments and funds of hedge funds. Most of these funds allow redemptions either quarterly or semi-annually after a two to three month notice period, while other funds allow for redemption after only a brief notification period with no restriction on redemption frequency. No unfunded commitments existed with respect to these hedge funds as of December 31, 2013. |
• | Real Estate and Private Equity Funds: We maintain plan assets invested in limited partnership interests in various private equity and real estate funds. These private equity and real estate investment funds are valued using fair values per the most recent partnership audited financial reports, adjusted as appropriate for any lag between the date of the financial reports and December 31. The real estate investments consist of U.S. and non-U.S. real estate investments and are broadly diversified. Limited provision exists for the redemption of these interests by the general partners that invest in these funds until the end of the term of the partnerships, typically ranging between 12 and 18 years from the date of inception. An active secondary market exists for similar partnership interests, although no particular value (discount or premium) can be guaranteed. At December 31, 2013, unfunded commitments to such limited partnerships totaling approximately $858 million are expected to be contributed over the remaining investment period, typically ranging between three and six years. |
Level 1 | Level 2 | Level 3 | Total Assets | Percentage of Plan Assets - 2013 | Target Allocation 2013 | |||||||||||||||
Asset Category (U.S. Plans): | ||||||||||||||||||||
Cash and cash equivalents | $ | 112 | $ | 514 | $ | — | $ | 626 | 2.3 | % | 0-5 | |||||||||
Equity Securities: | ||||||||||||||||||||
U.S. Large Cap | 2,264 | 1,948 | — | 4,212 | ||||||||||||||||
U.S. Small Cap | 457 | 50 | — | 507 | ||||||||||||||||
Emerging Markets | 1,247 | 120 | — | 1,367 | ||||||||||||||||
Global Equity | 2,154 | — | — | 2,154 | ||||||||||||||||
International Equity | 1,397 | 825 | — | 2,222 | ||||||||||||||||
Total Equity Securities | 7,519 | 2,943 | — | 10,462 | 39.4 | 25-55 | ||||||||||||||
Fixed Income Securities: | ||||||||||||||||||||
U.S. Government Securities | 3,746 | 615 | — | 4,361 | ||||||||||||||||
Corporate Bonds | 7 | 2,550 | 223 | 2,780 | ||||||||||||||||
Global Bonds | — | 681 | — | 681 | ||||||||||||||||
Municipal Bonds | — | 55 | — | 55 | ||||||||||||||||
Total Fixed Income Securities | 3,753 | 3,901 | 223 | 7,877 | 29.6 | 15-35 | ||||||||||||||
Other Investments: | ||||||||||||||||||||
Hedge Funds | — | — | 3,738 | 3,738 | 14.1 | 8-15 | ||||||||||||||
Private Equity | — | — | 1,397 | 1,397 | 5.3 | 3-10 | ||||||||||||||
Real Estate | 285 | 21 | 1,091 | 1,397 | 5.3 | 3-10 | ||||||||||||||
Structured Products(1) | — | 326 | — | 326 | 1.2 | 0-5 | ||||||||||||||
Other(2) | — | — | 756 | 756 | 2.8 | 1-10 | ||||||||||||||
Total U.S. Plan Assets | $ | 11,669 | $ | 7,705 | $ | 7,205 | $ | 26,579 | 100.0 | % | ||||||||||
Asset Category (International Plans): | ||||||||||||||||||||
Cash and cash equivalents | $ | 11 | $ | 17 | $ | — | 28 | 3.0 | 0-5 | |||||||||||
Equity Securities: | ||||||||||||||||||||
Local Markets Equity | 122 | 97 | — | 219 | ||||||||||||||||
U.S. Equity | 17 | — | — | 17 | ||||||||||||||||
Emerging Markets | 19 | — | — | 19 | ||||||||||||||||
International / Global Equity | 88 | 79 | — | 167 | ||||||||||||||||
Total Equity Securities | 246 | 176 | — | 422 | 45.3 | 50-65 | ||||||||||||||
Fixed Income Securities: | ||||||||||||||||||||
Local Government Bonds | 68 | — | — | 68 | ||||||||||||||||
Corporate Bonds | 86 | 85 | — | 171 | ||||||||||||||||
Total Fixed Income Securities | 154 | 85 | — | 239 | 25.7 | 15-35 | ||||||||||||||
Other Investments: | ||||||||||||||||||||
Real Estate | — | 63 | — | 63 | 6.8 | 0-17 | ||||||||||||||
Structured Products(1) | — | — | 55 | 55 | 5.9 | 0-10 | ||||||||||||||
Other | — | 124 | — | 124 | 13.3 | 0-20 | ||||||||||||||
Total International Plan Assets | $ | 411 | $ | 465 | $ | 55 | $ | 931 | 100.0 | % | ||||||||||
Total Plan Assets | $ | 12,080 | $ | 8,170 | $ | 7,260 | $ | 27,510 |
Level 1 | Level 2 | Level 3 | Total Assets | Percentage of Plan Assets - 2012 | Target Allocation 2012 | |||||||||||||||
Asset Category (U.S. Plans): | ||||||||||||||||||||
Cash and cash equivalents | $ | 103 | $ | 139 | $ | — | $ | 242 | 0.9 | % | 0-5 | |||||||||
Equity Securities: | ||||||||||||||||||||
U.S. Large Cap | 2,548 | 2,162 | — | 4,710 | ||||||||||||||||
U.S. Small Cap | 450 | 31 | — | 481 | ||||||||||||||||
Emerging Markets | 1,160 | 123 | — | 1,283 | ||||||||||||||||
Global Equity | 2,242 | — | — | 2,242 | ||||||||||||||||
International Equity | 442 | 694 | — | 1,136 | ||||||||||||||||
Total Equity Securities | 6,842 | 3,010 | — | 9,852 | 38.8 | 35-55 | ||||||||||||||
Fixed Income Securities: | ||||||||||||||||||||
U.S. Government Securities | 4,008 | 443 | — | 4,451 | ||||||||||||||||
Corporate Bonds | 9 | 3,113 | 138 | 3,260 | ||||||||||||||||
Global Bonds | — | 457 | — | 457 | ||||||||||||||||
Municipal Bonds | — | 83 | — | 83 | ||||||||||||||||
Total Fixed Income Securities | 4,017 | 4,096 | 138 | 8,251 | 32.5 | 25-35 | ||||||||||||||
Other Investments: | ||||||||||||||||||||
Hedge Funds | — | — | 2,829 | 2,829 | 11.1 | 5-15 | ||||||||||||||
Private Equity | — | — | 1,416 | 1,416 | 5.6 | 1-10 | ||||||||||||||
Real Estate | 177 | 23 | 1,039 | 1,239 | 4.9 | 1-10 | ||||||||||||||
Structured Products(1) | — | 210 | — | 210 | 0.8 | 0-5 | ||||||||||||||
Other(2) | — | — | 1,362 | 1,362 | 5.4 | 1-10 | ||||||||||||||
Total U.S. Plan Assets | $ | 11,139 | $ | 7,478 | $ | 6,784 | $ | 25,401 | 100.0 | % | ||||||||||
Asset Category (International Plans): | ||||||||||||||||||||
Cash and cash equivalents | $ | 5 | $ | 17 | $ | — | 22 | 2.8 | 0-5 | |||||||||||
Equity Securities: | ||||||||||||||||||||
Local Markets Equity | 118 | 79 | — | 197 | ||||||||||||||||
U.S. Equity | 14 | — | — | 14 | ||||||||||||||||
International / Global Equity | 71 | 59 | — | 130 | ||||||||||||||||
Total Equity Securities | 203 | 138 | — | 341 | 42.6 | 50-65 | ||||||||||||||
Fixed Income Securities: | ||||||||||||||||||||
Local Government Bonds | 64 | — | — | 64 | ||||||||||||||||
Corporate Bonds | 85 | 70 | — | 155 | ||||||||||||||||
Total Fixed Income Securities | 149 | 70 | — | 219 | 27.3 | 15-35 | ||||||||||||||
Other Investments: | ||||||||||||||||||||
Real Estate | — | 46 | — | 46 | 5.7 | 0-17 | ||||||||||||||
Structured Products(1) | — | — | 49 | 49 | 6.1 | 0-10 | ||||||||||||||
Other | — | 124 | — | 124 | 15.5 | 0-20 | ||||||||||||||
Total International Plan Assets | $ | 357 | $ | 395 | $ | 49 | $ | 801 | 100.0 | % | ||||||||||
Total Plan Assets | $ | 11,496 | $ | 7,873 | $ | 6,833 | $ | 26,202 |
Corporate Bonds | Hedge Funds | Real Estate | Private Equity | Other | Total | ||||||||||||||||||
Balance on January 1, 2012 | $ | 80 | $ | 2,132 | $ | 948 | $ | 1,354 | $ | 644 | $ | 5,158 | |||||||||||
Actual Return on Assets: | |||||||||||||||||||||||
Assets Held at End of Year | 1 | 59 | 85 | 163 | 159 | 467 | |||||||||||||||||
Assets Sold During the Year | (3 | ) | 5 | 4 | — | — | 6 | ||||||||||||||||
Purchases | 71 | 1,300 | 144 | 184 | 608 | 2,307 | |||||||||||||||||
Sales | (11 | ) | (667 | ) | (142 | ) | (285 | ) | — | (1,105 | ) | ||||||||||||
Settlements | — | — | — | — | — | — | |||||||||||||||||
Transfers Into (Out of) Level 3 | — | — | — | — | — | — | |||||||||||||||||
Balance on December 31, 2012 | $ | 138 | $ | 2,829 | $ | 1,039 | $ | 1,416 | $ | 1,411 | $ | 6,833 | |||||||||||
Actual Return on Assets: | |||||||||||||||||||||||
Assets Held at End of Year | (1 | ) | 229 | 81 | 71 | (93 | ) | 287 | |||||||||||||||
Assets Sold During the Year | — | 5 | 54 | 153 | 54 | 266 | |||||||||||||||||
Purchases | 165 | 1,676 | 145 | 143 | 1 | 2,130 | |||||||||||||||||
Sales | (79 | ) | (1,001 | ) | (228 | ) | (386 | ) | (562 | ) | (2,256 | ) | |||||||||||
Settlements | — | — | — | — | — | — | |||||||||||||||||
Transfers Into (Out of) Level 3 | — | — | — | — | — | — | |||||||||||||||||
Balance on December 31, 2013 | $ | 223 | $ | 3,738 | $ | 1,091 | $ | 1,397 | $ | 811 | $ | 7,260 |
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | |||||||||
Prior service cost / (benefit) | $ | 169 | $ | 4 | $ | 1 |
U.S. Pension Benefits | U.S. Postretirement Medical Benefits | International Pension Benefits | |||||||||
Employer Contributions: | |||||||||||
2014 (expected) to plan trusts | $ | — | $ | — | $ | 77 | |||||
2014 (expected) to plan participants | 16 | 100 | 3 | ||||||||
Expected Benefit Payments: | |||||||||||
2014 | $ | 885 | $ | 239 | $ | 24 | |||||
2015 | 981 | 253 | 26 | ||||||||
2016 | 1,081 | 270 | 27 | ||||||||
2017 | 1,188 | 286 | 30 | ||||||||
2018 | 1,306 | 300 | 32 | ||||||||
2019 - 2023 | 8,502 | 1,610 | 199 |
• | Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers. |
• | If a participating employer stops contributing to the multiemployer plan, the unfunded obligations of the plan may be borne by the remaining participating employers. |
• | If we choose to stop participating in some of our multiemployer plans, we may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability. However, cessation of participation in a multiemployer plan and subsequent payment of any withdrawal liability is subject to the collective bargaining process. |
EIN / Pension Plan | Pension Protection Act Zone Status | FIP/RP Status Pending/ | (in millions) UPS Contributions and Accruals | Surcharge | |||||||||||||||||
Pension Fund | Number | 2013 | 2012 | Implemented | 2013 | 2012 | 2011 | Imposed | |||||||||||||
Alaska Teamster-Employer Pension Plan | 92-6003463-024 | Red | Red | Yes/Implemented | $ | 5 | $ | 4 | $ | 4 | No | ||||||||||
Automotive Industries Pension Plan | 94-1133245-001 | Red | Red | Yes/Implemented | 4 | 4 | 4 | No | |||||||||||||
Central Pennsylvania Teamsters Defined Benefit Plan | 23-6262789-001 | Green | Yellow | Yes/Implemented | 30 | 29 | 27 | No | |||||||||||||
Employer-Teamsters Local Nos. 175 & 505 Pension Trust Fund | 55-6021850-001 | Green | Green | No | 9 | 9 | 8 | No | |||||||||||||
Hagerstown Motor Carriers and Teamsters Pension Fund | 52-6045424-001 | Red | Red | Yes/Implemented | 5 | 5 | 5 | No | |||||||||||||
I.A.M. National Pension Fund / National Pension Plan | 51-6031295-002 | Green | Green | No | 27 | 24 | 25 | No | |||||||||||||
International Brotherhood of Teamsters Union Local No. 710 Pension Fund | 36-2377656-001 | Green | Green | No | 88 | 75 | 74 | No | |||||||||||||
Local 705, International Brotherhood of Teamsters Pension Plan | 36-6492502-001 | Red | Red | Yes/Implemented | 68 | 46 | 58 | No | |||||||||||||
Local 804 I.B.T. & Local 447 I.A.M.—UPS Multiemployer Retirement Plan | 51-6117726-001 | Red | Red | Yes/Implemented | 88 | 87 | 84 | No | |||||||||||||
Milwaukee Drivers Pension Trust Fund | 39-6045229-001 | Green | Green | No | 29 | 26 | 26 | No | |||||||||||||
New England Teamsters & Trucking Industry Pension Fund | 04-6372430-001 | Red | Red | Yes/Implemented | 102 | 124 | 124 | No | |||||||||||||
New York State Teamsters Conference Pension and Retirement Fund | 16-6063585-074 | Red | Red | Yes/Implemented | 72 | 65 | 57 | No | |||||||||||||
Teamster Pension Fund of Philadelphia and Vicinity | 23-1511735-001 | Yellow | Yellow | Yes/Implemented | 46 | 44 | 41 | No | |||||||||||||
Teamsters Joint Council No. 83 of Virginia Pension Fund | 54-6097996-001 | Yellow | Yellow | Yes/Implemented | 49 | 44 | 41 | No | |||||||||||||
Teamsters Local 639—Employers Pension Trust | 53-0237142-001 | Green | Green | No | 41 | 36 | 33 | No | |||||||||||||
Teamsters Negotiated Pension Plan | 43-6196083-001 | Yellow | Red | Yes/Implemented | 26 | 24 | 22 | No | |||||||||||||
Truck Drivers and Helpers Local Union No. 355 Retirement Pension Plan | 52-6043608-001 | Yellow | Yellow | Yes/Implemented | 14 | 14 | 12 | No | |||||||||||||
United Parcel Service, Inc.—Local 177, I.B.T. Multiemployer Retirement Plan | 13-1426500-419 | Red | Red | Yes/Implemented | 68 | 62 | 57 | No | |||||||||||||
Western Conference of Teamsters Pension Plan | 91-6145047-001 | Green | Green | No | 553 | 520 | 476 | No | |||||||||||||
Western Pennsylvania Teamsters and Employers Pension Fund | 25-6029946-001 | Red | Red | Yes/Implemented | 23 | 24 | 21 | No | |||||||||||||
All Other Multiemployer Pension Plans | 49 | 59 | 44 | ||||||||||||||||||
Total Contributions | $ | 1,396 | $ | 1,325 | $ | 1,243 |
(in millions) UPS Contributions and Accruals | |||||||||||
Health and Welfare Fund | 2013 | 2012 | 2011 | ||||||||
Bay Area Delivery Drivers | $ | 29 | $ | 28 | $ | 27 | |||||
Central Pennsylvania Teamsters Health & Pension Fund | 20 | 19 | 18 | ||||||||
Central States, South East & South West Areas Health and Welfare Fund | 505 | 471 | 452 | ||||||||
Delta Health Systems—East Bay Drayage Drivers | 24 | 24 | 17 | ||||||||
Employer—Teamster Local Nos. 175 & 505 | 9 | 8 | 8 | ||||||||
Joint Council #83 Health & Welfare Fund | 24 | 25 | 25 | ||||||||
Local 191 Teamsters Health Fund | 9 | 9 | 9 | ||||||||
Local 401 Teamsters Health & Welfare Fund | 6 | 6 | 6 | ||||||||
Local 804 Welfare Trust Fund | 67 | 62 | 58 | ||||||||
Milwaukee Drivers Pension Trust Fund—Milwaukee Drivers Health and Welfare Trust Fund | 31 | 29 | 28 | ||||||||
Montana Teamster Employers Trust | 6 | 6 | 6 | ||||||||
New York State Teamsters Health & Hospital Fund | 46 | 44 | 41 | ||||||||
North Coast Benefit Trust | 8 | 7 | 7 | ||||||||
Northern California General Teamsters (DELTA) | 84 | 75 | 73 | ||||||||
Northern New England Benefit Trust | 35 | 33 | 32 | ||||||||
Oregon / Teamster Employers Trust | 28 | 27 | 27 | ||||||||
Teamsters 170 Health & Welfare Fund | 12 | 12 | 12 | ||||||||
Teamsters Benefit Trust | 38 | 32 | 29 | ||||||||
Teamsters Local 251 Health & Insurance Plan | 11 | 10 | 10 | ||||||||
Teamsters Local 404 Health & Insurance Plan | 6 | 6 | 6 | ||||||||
Teamsters Local 638 Health Fund | 32 | 29 | 28 | ||||||||
Teamsters Local 639—Employers Health & Pension Trust Funds | 24 | 22 | 22 | ||||||||
Teamsters Local 671 Health Services & Insurance Plan | 13 | 12 | 13 | ||||||||
Teamsters Union 25 Health Services & Insurance Plan | 37 | 36 | 34 | ||||||||
Teamsters Union Local 677 Health Services & Insurance Plan | 8 | 8 | 8 | ||||||||
Truck Drivers and Helpers Local 355 Baltimore Area Health & Welfare Fund | 13 | 13 | 12 | ||||||||
Utah-Idaho Teamsters Security Fund | 18 | 16 | 15 | ||||||||
Washington Teamsters Welfare Trust | 35 | 32 | 30 | ||||||||
All Other Multiemployer Health and Welfare Plans | 44 | 55 | 50 | ||||||||
Total Contributions | $ | 1,222 | $ | 1,156 | $ | 1,103 |
U.S. Domestic Package | International Package | Supply Chain & Freight | Consolidated | ||||||||||||
Balance on January 1, 2012 | $ | — | $ | 361 | $ | 1,740 | $ | 2,101 | |||||||
Acquired | — | 67 | — | 67 | |||||||||||
Currency / Other | — | 2 | 3 | 5 | |||||||||||
Balance on December 31, 2012 | $ | — | $ | 430 | $ | 1,743 | $ | 2,173 | |||||||
Acquired | — | 3 | 20 | 23 | |||||||||||
Currency / Other | — | (13 | ) | 7 | (6 | ) | |||||||||
Balance on December 31, 2013 | $ | — | $ | 420 | $ | 1,770 | $ | 2,190 |
Gross Carrying Amount | Accumulated Amortization | Net Carrying Value | Weighted- Average Amortization Period (in years) | ||||||||||
December 31, 2013 | |||||||||||||
Trademarks, licenses, patents, and other | $ | 257 | $ | (108 | ) | $ | 149 | 6.2 | |||||
Customer lists | 118 | (62 | ) | 56 | 12.8 | ||||||||
Franchise rights | 117 | (70 | ) | 47 | 20.0 | ||||||||
Capitalized software | 2,420 | (1,897 | ) | 523 | 5.0 | ||||||||
Total Intangible Assets, Net | $ | 2,912 | $ | (2,137 | ) | $ | 775 | 6.0 | |||||
December 31, 2012 | |||||||||||||
Trademarks, licenses, patents, and other | $ | 163 | $ | (80 | ) | $ | 83 | ||||||
Customer lists | 131 | (79 | ) | 52 | |||||||||
Franchise rights | 117 | (64 | ) | 53 | |||||||||
Capitalized software | 2,197 | (1,782 | ) | 415 | |||||||||
Total Intangible Assets, Net | $ | 2,608 | $ | (2,005 | ) | $ | 603 |
Principal | Carrying Value | ||||||||||||
Amount | Maturity | 2013 | 2012 | ||||||||||
Commercial paper | $ | — | $ | — | $ | — | |||||||
Fixed-rate senior notes: | |||||||||||||
4.50% senior notes | 1,750 | 2013 | — | 1,751 | |||||||||
3.875% senior notes | 1,000 | 2014 | 1,007 | 1,033 | |||||||||
1.125% senior notes | 375 | 2017 | 367 | 373 | |||||||||
5.50% senior notes | 750 | 2018 | 821 | 851 | |||||||||
5.125% senior notes | 1,000 | 2019 | 1,079 | 1,140 | |||||||||
3.125% senior notes | 1,500 | 2021 | 1,579 | 1,655 | |||||||||
2.45% senior notes | 1,000 | 2022 | 913 | 996 | |||||||||
6.20% senior notes | 1,500 | 2038 | 1,481 | 1,480 | |||||||||
4.875% senior notes | 500 | 2040 | 489 | 489 | |||||||||
3.625% senior notes | 375 | 2042 | 367 | 367 | |||||||||
8.375% Debentures: | |||||||||||||
8.375% debentures | 424 | 2020 | 479 | 512 | |||||||||
8.375% debentures | 276 | 2030 | 283 | 284 | |||||||||
Pound Sterling Notes: | |||||||||||||
5.50% notes | 110 | 2031 | 105 | 103 | |||||||||
5.125% notes | 750 | 2050 | 714 | 699 | |||||||||
Floating rate senior notes | 374 | 2049 – 2053 | 370 | 374 | |||||||||
Capital lease obligations | 473 | 2014 – 3004 | 473 | 440 | |||||||||
Facility notes and bonds | 320 | 2015 – 2036 | 320 | 320 | |||||||||
Other debt | 25 | 2014 - 2022 | 25 | 3 | |||||||||
Total debt | $ | 12,502 | 10,872 | 12,870 | |||||||||
Less: current maturities | (48 | ) | (1,781 | ) | |||||||||
Long-term debt | $ | 10,824 | $ | 11,089 |
Principal | Average Effective Interest Rate | |||||||||
Value | Maturity | 2013 | 2012 | |||||||
4.50% senior notes | 1,750 | 2013 | 2.43 | % | 2.51 | % | ||||
3.875% senior notes | 1,000 | 2014 | 0.97 | % | 1.14 | % | ||||
1.125% senior notes | 375 | 2017 | 0.64 | % | 0.57 | % | ||||
5.50% senior notes | 750 | 2018 | 2.53 | % | 2.71 | % | ||||
5.125% senior notes | 1,000 | 2019 | 2.01 | % | 2.20 | % | ||||
3.125% senior notes | 1,500 | 2021 | 1.11 | % | 1.28 | % | ||||
2.45% senior notes | 1,000 | 2022 | 0.86 | % | 0.86 | % |
• | $276 million of the debentures have a maturity of April 1, 2030. These debentures have an 8.375% interest rate until April 1, 2020, and, thereafter, the interest rate will be 7.62% for the final 10 years. These debentures are redeemable in whole or in part at our option at any time. The redemption price is equal to the greater of 100% of the principal amount and accrued interest or the sum of the present values of the remaining scheduled payout of principal and interest thereon discounted to the date of redemption at a benchmark treasury yield plus five basis points plus accrued interest. |
• | $424 million of the debentures have a maturity of April 1, 2020. These debentures are not subject to redemption prior to maturity. |
2013 | 2012 | ||||||
Vehicles | $ | 49 | $ | 63 | |||
Aircraft | 2,289 | 2,282 | |||||
Buildings | 181 | 65 | |||||
Plant Equipment | 2 | 2 | |||||
Technology Equipment | — | 3 | |||||
Accumulated amortization | (727 | ) | (611 | ) | |||
$ | 1,794 | $ | 1,804 |
• | Bonds with a principal balance of $149 million issued by the Louisville Regional Airport Authority associated with our Worldport facility in Louisville, Kentucky. The bonds, which are due in January 2029, bear interest at a variable rate, and the average interest rates for 2013 and 2012 were 0.09% and 0.15%, respectively. |
• | Bonds with a principal balance of $42 million and due in November 2036 issued by the Louisville Regional Airport Authority associated with our air freight facility in Louisville, Kentucky. The bonds bear interest at a variable rate, and the average interest rates for 2013 and 2012 were 0.08% and 0.15%, respectively. |
• | Bonds with a principal balance of $29 million issued by the Dallas / Fort Worth International Airport Facility Improvement Corporation associated with our Dallas, Texas airport facilities. The bonds are due in May 2032 and bear interest at a variable rate, however the variable cash flows on the obligation have been swapped to a fixed 5.11%. |
• | Bonds with a principal balance of $100 million issued by the Delaware County, Pennsylvania Industrial Development Authority associated with our Philadelphia, Pennsylvania airport facilities. The bonds, which are due in December 2015, bear interest at a variable rate, and the average interest rates for 2013 and 2012 were 0.07% and 0.13%, respectively. |
• | Notes with a principal amount of £66 million accrue interest at a 5.50% fixed rate, and are due in February 2031. These notes are not callable. |
• | Notes with a principal amount of £455 million accrue interest at a 5.125% fixed rate, and are due in February 2050. These notes are callable at our option at a redemption price equal to the greater of 100% of the principal amount and accrued interest, or the sum of the present values of the remaining scheduled payout of principal and interest thereon discounted to the date of redemption at a benchmark U.K. government bond yield plus 15 basis points and accrued interest. |
Year | Capital Leases | Operating Leases | Debt Principal | Purchase Commitments | |||||||||||
2014 | $ | 67 | $ | 310 | $ | 1,009 | $ | 333 | |||||||
2015 | 65 | 239 | 107 | 100 | |||||||||||
2016 | 58 | 180 | 6 | 50 | |||||||||||
2017 | 58 | 146 | 377 | 11 | |||||||||||
2018 | 53 | 99 | 750 | — | |||||||||||
After 2018 | 422 | 242 | 8,030 | — | |||||||||||
Total | 723 | $ | 1,216 | $ | 10,279 | $ | 494 | ||||||||
Less: imputed interest | (250 | ) | |||||||||||||
Present value of minimum capitalized lease payments | 473 | ||||||||||||||
Less: current portion | (39 | ) | |||||||||||||
Long-term capitalized lease obligations | $ | 434 |
2013 | 2012 | 2011 | ||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||
Class A Common Stock | ||||||||||||||||||||
Balance at beginning of year | 225 | $ | 3 | 240 | $ | 3 | 258 | $ | 3 | |||||||||||
Common stock purchases | (8 | ) | (1 | ) | (9 | ) | — | (7 | ) | — | ||||||||||
Stock award plans | 9 | — | 8 | — | 7 | — | ||||||||||||||
Common stock issuances | 4 | — | 3 | — | 3 | — | ||||||||||||||
Conversions of class A to class B common stock | (18 | ) | — | (17 | ) | — | (21 | ) | — | |||||||||||
Class A shares issued at end of year | 212 | $ | 2 | 225 | $ | 3 | 240 | $ | 3 | |||||||||||
Class B Common Stock | ||||||||||||||||||||
Balance at beginning of year | 729 | $ | 7 | 725 | $ | 7 | 735 | $ | 7 | |||||||||||
Common stock purchases | (35 | ) | — | (13 | ) | — | (31 | ) | — | |||||||||||
Conversions of class A to class B common stock | 18 | — | 17 | — | 21 | — | ||||||||||||||
Class B shares issued at end of year | 712 | $ | 7 | 729 | $ | 7 | 725 | $ | 7 | |||||||||||
Additional Paid-In Capital | ||||||||||||||||||||
Balance at beginning of year | $ | — | $ | — | $ | — | ||||||||||||||
Stock award plans | 554 | 444 | 388 | |||||||||||||||||
Common stock purchases | (768 | ) | (943 | ) | (475 | ) | ||||||||||||||
Common stock issuances | 307 | 293 | 287 | |||||||||||||||||
Option Premiums Received (Paid) | (93 | ) | 206 | (200 | ) | |||||||||||||||
Balance at end of year | $ | — | $ | — | $ | — | ||||||||||||||
Retained Earnings | ||||||||||||||||||||
Balance at beginning of year | $ | 7,997 | $ | 10,128 | $ | 10,604 | ||||||||||||||
Net income attributable to controlling interests | 4,372 | 807 | 3,804 | |||||||||||||||||
Dividends ($2.48, $2.28 and $2.08 per share) | (2,367 | ) | (2,243 | ) | (2,086 | ) | ||||||||||||||
Common stock purchases | (3,077 | ) | (695 | ) | (2,194 | ) | ||||||||||||||
Balance at end of year | $ | 6,925 | $ | 7,997 | $ | 10,128 |
2013 | 2012 | 2011 | |||||||||
Foreign currency translation gain (loss): | |||||||||||
Balance at beginning of year | $ | 134 | $ | (160 | ) | $ | (68 | ) | |||
Reclassification to earnings (no tax impact in either period) | (161 | ) | — | — | |||||||
Translation adjustment (net of tax effect of $(5), $(9) and $11) | (99 | ) | 294 | (92 | ) | ||||||
Balance at end of year | (126 | ) | 134 | (160 | ) | ||||||
Unrealized gain (loss) on marketable securities, net of tax: | |||||||||||
Balance at beginning of year | 6 | 6 | 12 | ||||||||
Current period changes in fair value (net of tax effect of $(3), $4 and $11) | (4 | ) | 6 | 18 | |||||||
Reclassification to earnings (net of tax effect of $(2), $(3) and $(14)) | (3 | ) | (6 | ) | (24 | ) | |||||
Balance at end of year | (1 | ) | 6 | 6 | |||||||
Unrealized gain (loss) on cash flow hedges, net of tax: | |||||||||||
Balance at beginning of year | (286 | ) | (204 | ) | (239 | ) | |||||
Current period changes in fair value (net of tax effect of $1, $(25) and $(16)) | 1 | (43 | ) | (26 | ) | ||||||
Reclassification to earnings (net of tax effect of $39, $(24) and $37) | 66 | (39 | ) | 61 | |||||||
Balance at end of year | (219 | ) | (286 | ) | (204 | ) | |||||
Unrecognized pension and postretirement benefit costs, net of tax: | |||||||||||
Balance at beginning of year | (3,208 | ) | (2,745 | ) | (2,340 | ) | |||||
Reclassification to earnings (net of tax effect of $67, $1,876 and $378) | 111 | 3,135 | 628 | ||||||||
Net actuarial gain (loss) and prior service cost resulting from remeasurements of plan assets and liabilities (net of tax effect of $1,786, $(2,151) and $(622)) | 2,983 | (3,598 | ) | (1,033 | ) | ||||||
Balance at end of year | (114 | ) | (3,208 | ) | (2,745 | ) | |||||
Accumulated other comprehensive income (loss) at end of year | $ | (460 | ) | $ | (3,354 | ) | $ | (3,103 | ) |
2013 Amount Reclassified from AOCI | 2012 Amount Reclassified from AOCI | 2011 Amount Reclassified from AOCI | Affected Line Item in the Income Statement | ||||||||||
Foreign currency translation gain (loss): | |||||||||||||
Liquidation of foreign subsidiary | $ | 161 | $ | — | $ | — | Other expenses | ||||||
Income tax (expense) benefit | — | — | — | Income tax expense | |||||||||
Impact on net income | 161 | — | — | Net income | |||||||||
Unrealized gain (loss) on marketable securities: | |||||||||||||
Realized gain (loss) on sale of securities | 5 | 9 | 38 | Investment income | |||||||||
Income tax (expense) benefit | (2 | ) | (3 | ) | (14 | ) | Income tax expense | ||||||
Impact on net income | 3 | 6 | 24 | Net income | |||||||||
Unrealized gain (loss) on cash flow hedges: | |||||||||||||
Interest rate contracts | (22 | ) | (22 | ) | (19 | ) | Interest expense | ||||||
Foreign exchange contracts | 18 | 24 | 13 | Interest expense | |||||||||
Foreign exchange contracts | (53 | ) | 61 | (101 | ) | Revenue | |||||||
Commodity contracts | (48 | ) | — | 9 | Fuel expense | ||||||||
Income tax (expense) benefit | 39 | (24 | ) | 37 | Income tax expense | ||||||||
Impact on net income | (66 | ) | 39 | (61 | ) | Net income | |||||||
Unrecognized pension and postretirement benefit costs: | |||||||||||||
Prior service costs | (178 | ) | (5,011 | ) | (1,006 | ) | Compensation and benefits | ||||||
Income tax (expense) benefit | 67 | 1,876 | 378 | Income tax expense | |||||||||
Impact on net income | (111 | ) | (3,135 | ) | (628 | ) | Net income | ||||||
Total amount reclassified for the period | $ | (13 | ) | $ | (3,090 | ) | $ | (665 | ) | Net income |
2013 | 2012 | 2011 | ||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||
Deferred Compensation Obligations | ||||||||||||||||||||
Balance at beginning of year | $ | 78 | $ | 88 | $ | 103 | ||||||||||||||
Reinvested dividends | 4 | 3 | 4 | |||||||||||||||||
Options exercise deferrals | — | — | — | |||||||||||||||||
Benefit payments | (13 | ) | (13 | ) | (19 | ) | ||||||||||||||
Balance at end of year | $ | 69 | $ | 78 | $ | 88 | ||||||||||||||
Treasury Stock | ||||||||||||||||||||
Balance at beginning of year | (1 | ) | $ | (78 | ) | (2 | ) | $ | (88 | ) | (2 | ) | $ | (103 | ) | |||||
Reinvested dividends | — | (4 | ) | — | (3 | ) | — | (4 | ) | |||||||||||
Options exercise deferrals | — | — | — | — | — | — | ||||||||||||||
Benefit payments | — | 13 | 1 | 13 | — | 19 | ||||||||||||||
Balance at end of year | (1 | ) | $ | (69 | ) | (1 | ) | $ | (78 | ) | (2 | ) | $ | (88 | ) |
2013 | 2012 | 2011 | |||||||||
Noncontrolling Interests | |||||||||||
Balance at beginning of period | $ | 80 | $ | 73 | $ | 68 | |||||
Purchase of noncontrolling interests | (66 | ) | 7 | 5 | |||||||
Dividends attributable to noncontrolling interests | — | — | — | ||||||||
Net income attributable to noncontrolling interests | — | — | — | ||||||||
Balance at end of period | $ | 14 | $ | 80 | $ | 73 |
Shares (in thousands) | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (in millions) | |||||||||
Nonvested at January 1, 2013 | 14,644 | $ | 68.71 | |||||||||
Vested | (7,577 | ) | 64.73 | |||||||||
Granted | 5,461 | 80.18 | ||||||||||
Reinvested Dividends | 437 | N/A | ||||||||||
Forfeited / Expired | (217 | ) | 72.12 | |||||||||
Nonvested at December 31, 2013 | 12,748 | $ | 74.60 | 1.47 | $ | 1,340 | ||||||
Restricted Units Expected to Vest | 12,330 | $ | 74.57 | 1.45 | $ | 1,296 |
Shares (in thousands) | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (in millions) | |||||||||
Outstanding at January 1, 2013 | 10,595 | $ | 72.04 | |||||||||
Exercised | (5,524 | ) | 70.85 | |||||||||
Granted | 178 | 82.93 | ||||||||||
Forfeited / Expired | (37 | ) | 63.34 | |||||||||
Outstanding at December 31, 2013 | 5,212 | $ | 73.73 | 3.00 | $ | 163 | ||||||
Options Vested and Expected to Vest | 5,212 | $ | 73.73 | 3.00 | $ | 163 | ||||||
Exercisable at December 31, 2013 | 4,759 | $ | 73.52 | 2.53 | $ | 150 |
2013 | 2012 | 2011 | |||||||||
Expected dividend yield | 2.75 | % | 2.77 | % | 2.77 | % | |||||
Risk-free interest rate | 1.38 | % | 1.63 | % | 2.90 | % | |||||
Expected life in years | 7.5 | 7.5 | 7.5 | ||||||||
Expected volatility | 24.85 | % | 25.06 | % | 24.26 | % | |||||
Weighted average fair value of options granted | $ | 15.50 | $ | 14.88 | $ | 15.92 |
Options Outstanding | Options Exercisable | ||||||||||||||
Exercise Price Range | Shares (in thousands) | Average Life (in years) | Average Exercise Price | Shares (in thousands) | Average Exercise Price | ||||||||||
$50.01 - $60.00 | 185 | 5.35 | $ | 55.83 | 150 | $ | 55.83 | ||||||||
$60.01 - $70.00 | 144 | 6.35 | 67.18 | 97 | 67.18 | ||||||||||
$70.01 - $80.00 | 3,380 | 2.68 | 71.70 | 3,170 | 71.43 | ||||||||||
$80.01 - $90.00 | 1,503 | 3.10 | 81.13 | 1,342 | 80.91 | ||||||||||
5,212 | 3.00 | $ | 73.73 | 4,759 | $ | 73.52 |
2013 | 2012 | 2011 | |||||||||
Revenue: | |||||||||||
U.S. Domestic Package | $ | 34,074 | $ | 32,856 | $ | 31,717 | |||||
International Package | 12,429 | 12,124 | 12,249 | ||||||||
Supply Chain & Freight | 8,935 | 9,147 | 9,139 | ||||||||
Consolidated | $ | 55,438 | $ | 54,127 | $ | 53,105 | |||||
Operating Profit: | |||||||||||
U.S. Domestic Package | $ | 4,603 | $ | 459 | $ | 3,764 | |||||
International Package | 1,757 | 869 | 1,709 | ||||||||
Supply Chain & Freight | 674 | 15 | 607 | ||||||||
Consolidated | $ | 7,034 | $ | 1,343 | $ | 6,080 | |||||
Assets: | |||||||||||
U.S. Domestic Package | $ | 19,648 | $ | 19,934 | $ | 19,300 | |||||
International Package | 8,463 | 11,248 | 6,729 | ||||||||
Supply Chain & Freight | 6,624 | 6,610 | 6,588 | ||||||||
Unallocated | 1,477 | 1,071 | 2,084 | ||||||||
Consolidated | $ | 36,212 | $ | 38,863 | $ | 34,701 | |||||
Depreciation and Amortization Expense: | |||||||||||
U.S. Domestic Package | $ | 1,229 | $ | 1,220 | $ | 1,154 | |||||
International Package | 473 | 475 | 474 | ||||||||
Supply Chain & Freight | 165 | 163 | 154 | ||||||||
Consolidated | $ | 1,867 | $ | 1,858 | $ | 1,782 |
2013 | 2012 | 2011 | |||||||||
U.S. Domestic Package: | |||||||||||
Next Day Air | $ | 6,443 | $ | 6,412 | $ | 6,229 | |||||
Deferred | 3,437 | 3,392 | 3,299 | ||||||||
Ground | 24,194 | 23,052 | 22,189 | ||||||||
Total U.S. Domestic Package | 34,074 | 32,856 | 31,717 | ||||||||
International Package: | |||||||||||
Domestic | 2,667 | 2,531 | 2,628 | ||||||||
Export | 9,166 | 9,033 | 9,056 | ||||||||
Cargo | 596 | 560 | 565 | ||||||||
Total International Package | 12,429 | 12,124 | 12,249 | ||||||||
Supply Chain & Freight: | |||||||||||
Forwarding and Logistics | 5,492 | 5,977 | 6,103 | ||||||||
Freight | 2,882 | 2,640 | 2,563 | ||||||||
Other | 561 | 530 | 473 | ||||||||
Total Supply Chain & Freight | 8,935 | 9,147 | 9,139 | ||||||||
Consolidated | $ | 55,438 | $ | 54,127 | $ | 53,105 |
2013 | 2012 | 2011 | |||||||||
United States: | |||||||||||
Revenue | $ | 41,772 | $ | 40,428 | $ | 39,347 | |||||
Long-lived assets | $ | 15,651 | $ | 16,262 | $ | 16,085 | |||||
International: | |||||||||||
Revenue | $ | 13,666 | $ | 13,699 | $ | 13,758 | |||||
Long-lived assets | $ | 6,297 | $ | 5,312 | $ | 5,220 | |||||
Consolidated: | |||||||||||
Revenue | $ | 55,438 | $ | 54,127 | $ | 53,105 | |||||
Long-lived assets | $ | 21,948 | $ | 21,574 | $ | 21,305 |
2013 | 2012 | 2011 | |||||||||
Current: | |||||||||||
U.S. Federal | $ | 2,181 | $ | 1,901 | $ | 1,371 | |||||
U.S. State and Local | 205 | 182 | 121 | ||||||||
Non-U.S. | 162 | 167 | 166 | ||||||||
Total Current | 2,548 | 2,250 | 1,658 | ||||||||
Deferred: | |||||||||||
U.S. Federal | (242 | ) | (1,871 | ) | 262 | ||||||
U.S. State and Local | (22 | ) | (201 | ) | 44 | ||||||
Non-U.S. | 18 | (11 | ) | 8 | |||||||
Total Deferred | (246 | ) | (2,083 | ) | 314 | ||||||
Total | $ | 2,302 | $ | 167 | $ | 1,972 |
2013 | 2012 | 2011 | |||||||||
United States | $ | 6,040 | $ | 384 | $ | 5,309 | |||||
Non-U.S. | 634 | 590 | 467 | ||||||||
$ | 6,674 | $ | 974 | $ | 5,776 |
2013 | 2012 | 2011 | ||||||
Statutory U.S. federal income tax rate | 35.0 | % | 35.0 | % | 35.0 | % | ||
U.S. state and local income taxes (net of federal benefit) | 2.1 | — | 2.0 | |||||
Non-U.S. tax rate differential | (1.3 | ) | (6.1 | ) | (0.4 | ) | ||
Nondeductible/nontaxable items | (0.2 | ) | (0.4 | ) | (0.1 | ) | ||
U.S. federal tax credits | (1.2 | ) | (7.4 | ) | (1.7 | ) | ||
Other | 0.1 | (4.0 | ) | (0.7 | ) | |||
Effective income tax rate | 34.5 | % | 17.1 | % | 34.1 | % |
2013 | 2012 | ||||||
Property, plant and equipment | $ | (3,613 | ) | $ | (3,624 | ) | |
Goodwill and intangible assets | (1,116 | ) | (1,035 | ) | |||
Other | (651 | ) | (617 | ) | |||
Deferred tax liabilities | (5,380 | ) | (5,276 | ) | |||
Pension and postretirement benefits | 3,086 | 4,608 | |||||
Loss and credit carryforwards (non-U.S. and state) | 279 | 258 | |||||
Insurance reserves | 765 | 737 | |||||
Vacation pay accrual | 224 | 209 | |||||
Stock compensation | 70 | 159 | |||||
Other | 709 | 708 | |||||
Deferred tax assets | 5,133 | 6,679 | |||||
Deferred tax assets valuation allowance | (251 | ) | (220 | ) | |||
Deferred tax asset (net of valuation allowance) | 4,882 | 6,459 | |||||
Net deferred tax asset (liability) | $ | (498 | ) | $ | 1,183 | ||
Amounts recognized in the consolidated balance sheets: | |||||||
Current deferred tax assets | $ | 684 | $ | 583 | |||
Current deferred tax liabilities (included in other current liabilities) | (48 | ) | (36 | ) | |||
Non-current deferred tax assets | 110 | 684 | |||||
Non-current deferred tax liabilities | (1,244 | ) | (48 | ) | |||
Net deferred tax asset (liability) | $ | (498 | ) | $ | 1,183 |
2013 | 2012 | ||||||
U.S. state and local operating loss carryforwards | $ | 546 | $ | 608 | |||
U.S. state and local credit carryforwards | $ | 42 | $ | 61 |
Tax | Interest | Penalties | |||||||||
Balance at January 1, 2011 | $ | 284 | $ | 95 | $ | 7 | |||||
Additions for tax positions of the current year | 13 | — | — | ||||||||
Additions for tax positions of prior years | 17 | 6 | — | ||||||||
Reductions for tax positions of prior years for: | |||||||||||
Changes based on facts and circumstances | (50 | ) | (9 | ) | (2 | ) | |||||
Settlements during the period | (11 | ) | (19 | ) | (1 | ) | |||||
Lapses of applicable statute of limitations | (1 | ) | — | (1 | ) | ||||||
Balance at December 31, 2011 | 252 | 73 | 3 | ||||||||
Additions for tax positions of the current year | 13 | — | — | ||||||||
Additions for tax positions of prior years | 7 | 9 | 1 | ||||||||
Reductions for tax positions of prior years for: | |||||||||||
Changes based on facts and circumstances | (22 | ) | (18 | ) | — | ||||||
Settlements during the period | (3 | ) | (7 | ) | — | ||||||
Lapses of applicable statute of limitations | (15 | ) | (4 | ) | — | ||||||
Balance at December 31, 2012 | 232 | 53 | 4 | ||||||||
Additions for tax positions of the current year | 15 | — | — | ||||||||
Additions for tax positions of prior years | 20 | 9 | 2 | ||||||||
Reductions for tax positions of prior years for: | |||||||||||
Changes based on facts and circumstances | (67 | ) | (23 | ) | (1 | ) | |||||
Settlements during the period | (8 | ) | 1 | — | |||||||
Lapses of applicable statute of limitations | (1 | ) | — | (1 | ) | ||||||
Balance at December 31, 2013 | $ | 191 | $ | 40 | $ | 4 |
2013 | 2012 | 2011 | |||||||||
Numerator: | |||||||||||
Net income attributable to common shareowners | $ | 4,372 | $ | 807 | $ | 3,804 | |||||
Denominator: | |||||||||||
Weighted average shares | 937 | 957 | 977 | ||||||||
Deferred compensation obligations | 1 | 1 | 2 | ||||||||
Vested portion of restricted shares | 2 | 2 | 2 | ||||||||
Denominator for basic earnings per share | 940 | 960 | 981 | ||||||||
Effect of dilutive securities: | |||||||||||
Restricted performance units | 7 | 8 | 9 | ||||||||
Stock options | 1 | 1 | 1 | ||||||||
Denominator for diluted earnings per share | 948 | 969 | 991 | ||||||||
Basic earnings per share | $ | 4.65 | $ | 0.84 | $ | 3.88 | |||||
Diluted earnings per share | $ | 4.61 | $ | 0.83 | $ | 3.84 |
2013 | 2012 | ||||||
Currency Hedges: | |||||||
Euro | EUR | 2,637 | 1,783 | ||||
British Pound Sterling | GBP | 1,097 | 797 | ||||
Canadian Dollar | CAD | 218 | 341 | ||||
United Arab Emirates Dirham | AED | — | 551 | ||||
Malaysian Ringgit | MYR | — | 500 | ||||
Mexican Peso | MXN | 583 | — | ||||
Interest Rate Hedges: | |||||||
Fixed to Floating Interest Rate Swaps | USD | 6,799 | 7,274 | ||||
Floating to Fixed Interest Rate Swaps | USD | 780 | 781 | ||||
Interest Rate Basis Swaps | USD | 2,500 | 2,500 |
Gross Amounts Presented in Consolidated Balance Sheets | Net Amounts if Right of Offset had been Applied | ||||||||||||||||
Asset Derivatives | Balance Sheet Location | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Derivatives designated as hedges: | |||||||||||||||||
Foreign exchange contracts | Other current assets | $ | 10 | $ | 27 | $ | 4 | $ | 27 | ||||||||
Interest rate contracts | Other current assets | 7 | 1 | 7 | 1 | ||||||||||||
Foreign exchange contracts | Other non-current assets | 59 | 14 | 59 | 12 | ||||||||||||
Interest rate contracts | Other non-current assets | 204 | 420 | 110 | 406 | ||||||||||||
Derivatives not designated as hedges: | |||||||||||||||||
Foreign exchange contracts | Other current assets | 7 | 3 | 5 | 3 | ||||||||||||
Interest rate contracts | Other non-current assets | 60 | 101 | 57 | 91 | ||||||||||||
Total Asset Derivatives | $ | 347 | $ | 566 | $ | 242 | $ | 540 | |||||||||
Gross Amounts Presented in Consolidated Balance Sheets | Net Amounts if Right of Offset had been Applied | ||||||||||||||||
Liability Derivatives | Balance Sheet Location | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Derivatives designated as hedges: | |||||||||||||||||
Foreign exchange contracts | Other current liabilities | $ | 6 | $ | — | $ | — | $ | — | ||||||||
Foreign exchange contracts | Other non-current liabilities | — | 103 | — | 101 | ||||||||||||
Interest rate contracts | Other non-current liabilities | 104 | 14 | 10 | — | ||||||||||||
Derivatives not designated as hedges: | |||||||||||||||||
Foreign exchange contracts | Other current liabilities | 7 | 1 | 5 | 1 | ||||||||||||
Interest rate contracts | Other current liabilities | 1 | — | 1 | — | ||||||||||||
Interest rate contracts | Other non-current liabilities | 3 | 41 | — | 31 | ||||||||||||
Total Liability Derivatives | $ | 121 | $ | 159 | $ | 16 | $ | 133 |
Derivative Instruments in Cash Flow Hedging Relationships | Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion) | ||||||||
2013 | 2012 | ||||||||
Interest rate contracts | $ | 6 | $ | (71 | ) | ||||
Foreign exchange contracts | 44 | 3 | |||||||
Commodity contracts | (48 | ) | — | ||||||
Total | $ | 2 | $ | (68 | ) |
Derivative Instruments in Fair Value Hedging Relationships | Location of Gain (Loss) Recognized in Income | Amount of Gain (Loss) Recognized in Income | Hedged Items in Fair Value Hedging Relationships | Location of Gain (Loss) Recognized in Income | Amount of Gain (Loss) Recognized in Income | |||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Interest rate contracts | Interest Expense | $ | (306 | ) | $ | 20 | Fixed-Rate Debt and Capital Leases | Interest Expense | $ | 306 | $ | (20 | ) |
Derivative Instruments Not Designated in Hedging Relationships | Location of Gain (Loss) Recognized in Income | Amount of Gain (Loss) Recognized in Income | ||||||||
2013 | 2012 | |||||||||
Foreign exchange contracts | Revenue | $ | — | $ | 2 | |||||
Foreign exchange contracts | Other Operating Expenses | 72 | 19 | |||||||
Foreign exchange contracts | Investment Income | (5 | ) | (22 | ) | |||||
Interest rate contracts | Interest Expense | (4 | ) | (12 | ) | |||||
Total | $ | 63 | $ | (13 | ) |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||
2013 | ||||||||||||||||
Assets | ||||||||||||||||
Foreign Exchange Contracts | $ | — | $ | 76 | $ | — | $ | 76 | ||||||||
Interest Rate Contracts | — | 271 | — | 271 | ||||||||||||
Total | $ | — | $ | 347 | $ | — | $ | 347 | ||||||||
Liabilities | ||||||||||||||||
Foreign Exchange Contracts | $ | — | $ | 13 | $ | — | $ | 13 | ||||||||
Interest Rate Contracts | — | 108 | — | 108 | ||||||||||||
Total | $ | — | $ | 121 | $ | — | $ | 121 | ||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||
2012 | ||||||||||||||||
Assets | ||||||||||||||||
Foreign Exchange Contracts | $ | — | $ | 44 | $ | — | $ | 44 | ||||||||
Interest Rate Contracts | — | 522 | — | 522 | ||||||||||||
Total | $ | — | $ | 566 | $ | — | $ | 566 | ||||||||
Liabilities | ||||||||||||||||
Foreign Exchange Contracts | $ | — | $ | 104 | $ | — | $ | 104 | ||||||||
Interest Rate Contracts | — | 55 | — | 55 | ||||||||||||
Total | $ | — | $ | 159 | $ | — | $ | 159 |
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||
U.S. Domestic Package | $ | 8,271 | $ | 8,004 | $ | 8,241 | $ | 8,058 | $ | 8,254 | $ | 7,861 | $ | 9,308 | $ | 8,933 | |||||||||||||||
International Package | 2,978 | 2,966 | 3,062 | 3,014 | 3,017 | 2,943 | 3,372 | 3,201 | |||||||||||||||||||||||
Supply Chain & Freight | 2,185 | 2,166 | 2,204 | 2,277 | 2,250 | 2,267 | 2,296 | 2,437 | |||||||||||||||||||||||
Total revenue | 13,434 | 13,136 | 13,507 | 13,349 | 13,521 | 13,071 | 14,976 | 14,571 | |||||||||||||||||||||||
Operating profit (loss): | |||||||||||||||||||||||||||||||
U.S. Domestic Package | 1,085 | 995 | 1,132 | 1,134 | 1,186 | 129 | 1,200 | (1,799 | ) | ||||||||||||||||||||||
International Package | 352 | 408 | 451 | 454 | 417 | 449 | 537 | (442 | ) | ||||||||||||||||||||||
Supply Chain & Freight | 143 | 166 | 159 | 202 | 201 | 188 | 171 | (541 | ) | ||||||||||||||||||||||
Total operating profit (loss) | 1,580 | 1,569 | 1,742 | 1,790 | 1,804 | 766 | 1,908 | (2,782 | ) | ||||||||||||||||||||||
Net income (loss) | $ | 1,037 | $ | 970 | $ | 1,071 | $ | 1,116 | $ | 1,097 | $ | 469 | $ | 1,167 | $ | (1,748 | ) | ||||||||||||||
Net income (loss) per share: | |||||||||||||||||||||||||||||||
Basic | $ | 1.09 | $ | 1.01 | $ | 1.14 | $ | 1.16 | $ | 1.17 | $ | 0.49 | $ | 1.26 | $ | (1.83 | ) | ||||||||||||||
Diluted | $ | 1.08 | $ | 1.00 | $ | 1.13 | $ | 1.15 | $ | 1.16 | $ | 0.48 | $ | 1.25 | $ | (1.83 | ) |
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
Item 9A. | Controls and Procedures |
Item 9B. | Other Information |
Item 10. | Directors, Executive Officers and Corporate Governance |
Name and Office | Age | Principal Occupation and Employment For the Last Five Years | |||
David P. Abney Senior Vice President and Chief Operating Officer | 58 | Senior Vice President and Chief Operating Officer (2007 – present), President, UPS Airlines (2007 – 2008), Senior Vice President and President, UPS International (2003 – 2007). | |||
James J. Barber, Jr. Senior Vice President and President, UPS International | 53 | Senior Vice President and President, UPS International (2013 – present). | |||
David A. Barnes Senior Vice President and Chief Information Officer | 58 | Senior Vice President and Chief Information Officer (2005 – present). | |||
D. Scott Davis Chairman and Chief Executive Officer | 62 | Chairman and Chief Executive Officer (2008 – present), Vice Chairman (2006 – 2007), Senior Vice President, Chief Financial Officer and Treasurer (2001 – 2007), Director (2006 – present). | |||
Alan Gershenhorn Senior Vice President | 55 | Senior Vice President, Worldwide Sales, Marketing and Strategy (2011 – present), Senior Vice President, Worldwide Sales and Marketing (2008 – 2010), Senior Vice President and President, UPS International (2007), President, UPS Supply Chain Solutions – Asia and Europe (2006). | |||
Myron Gray Senior Vice President | 56 | Senior Vice President, U.S. Operations (2009 – present), Vice President, Americas Region (2008 – 2009), Vice President, North Central Region (2004 – 2008). | |||
Kurt P. Kuehn Senior Vice President and Chief Financial Officer | 59 | Senior Vice President and Chief Financial Officer (2008 – present), Treasurer (2008 – 2010), Senior Vice President, Worldwide Sales and Marketing (2004 – 2007). | |||
Teri P. McClure Senior Vice President, General Counsel and Corporate Secretary | 50 | Senior Vice President of Legal, Compliance and Public Affairs, General Counsel and Corporate Secretary (2006 – present), Corporate Legal Department Manager (2005 – 2006). | |||
John J. McDevitt Senior Vice President | 55 | Senior Vice President, Human Resources and Labor Relations (2012 – Present), Senior Vice President, Global Transportation Services and Labor Relations (2005 – 2011). |
Item 11. | Executive Compensation |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Item 13. | Certain Relationships and Related Transactions, and Director Independence |
Item 14. | Principal Accounting Fees and Services |
Item 15. | Exhibits and Financial Statement Schedules |
UNITED PARCEL SERVICE, INC. | ||
(REGISTRANT) | ||
By: | /S/ D. SCOTT DAVIS | |
D. Scott Davis | ||
Chairman and Chief Executive Officer |
Signature | Title | Date | ||
/S/ F. DUANE ACKERMAN | Director | February 24, 2014 | ||
F. Duane Ackerman | ||||
/S/ RODNEY C. ADKINS | Director | February 23, 2014 | ||
Rodney C. Adkins | ||||
/S/ MICHAEL J. BURNS | Director | February 21, 2014 | ||
Michael J. Burns | ||||
/S/ D. SCOTT DAVIS | Chairman, Chief Executive Officer and Director (Principal Executive Officer) | February 28, 2014 | ||
D. Scott Davis | ||||
/S/ STUART E. EIZENSTAT | Director | February 26, 2014 | ||
Stuart E. Eizenstat | ||||
/S/ MICHAEL L. ESKEW | Director | February 26, 2014 | ||
Michael L. Eskew | ||||
/S/ WILLIAM R. JOHNSON | Director | February 21, 2014 | ||
William R. Johnson | ||||
/S/ CANDACE KENDLE | Director | February 21, 2014 | ||
Candace Kendle | ||||
/S/ KURT P. KUEHN | Chief Financial Officer (Principal Financial and Accounting Officer) | February 28, 2014 | ||
Kurt P. Kuehn | ||||
/S/ ANN M. LIVERMORE | Director | February 21, 2014 | ||
Ann M. Livermore | ||||
/S/ RUDY MARKHAM | Director | February 25, 2014 | ||
Rudy Markham | ||||
/S/ CLARK T. RANDT, JR. | Director | February 21, 2014 | ||
Clark T. Randt, Jr. | ||||
/S/ CAROL B. TOMÉ | Director | February 21, 2014 | ||
Carol B. Tomé | ||||
/S/ KEVIN M. WARSH | Director | February 21, 2014 | ||
Kevin M. Warsh |
Exhibit No. | Description | |
2.1 | — | Termination Agreement, dated as of January 22, 2013, between United Parcel Service, Inc. and TNT Express N.V. (incorporated by reference to Exhibit 2.3 to the 2012 Annual Report on Form 10-K) |
3.1 | — | Form of Restated Certificate of Incorporation of United Parcel Service, Inc. (incorporated by reference to Exhibit 3.2 to Form 8-K filed on May 12, 2010). |
3.2 | — | Amended and Restated Bylaws of United Parcel Service, Inc. as of February 14, 2013 (incorporated by reference to Exhibit 3.1 to Form 8-K, filed on February 19, 2013). |
4.1 | — | Indenture relating to 8 3/8% Debentures due April 1, 2020 (incorporated by reference to Exhibit 4(c) to Registration Statement No. 33-32481, filed December 7, 1989). |
4.2 | — | Indenture dated as of December 18, 1997 relating to 8 3/8% Debentures due 2030 (incorporated by reference to Exhibit T-3C to Form T-3 filed December 18, 1997). |
4.3 | — | Indenture dated as of January 26, 1999 (incorporated by reference to Exhibit 4.1 to Pre-Effective Amendment No. 1 to Form S-3 (No. 333-08369), filed on January 26, 1999). |
4.4 | — | Form of Supplemental Indenture dated as of March 27, 2000 to Indenture dated January 26, 1999 (incorporated by reference to Exhibit 4.2 to Post-Effective Amendment No. 1 to Form S-3 (No. 333-08369-01), filed on March 15, 2000). |
4.5 | — | Form of Second Supplemental Indenture dated as of September 21, 2001 to Indenture dated January 26, 1999 (incorporated by reference to Exhibit 4 to Form 10-Q for the Quarter Ended September 30, 2001). |
4.6 | — | Form of Indenture dated as of August 26, 2003 (incorporated by reference to Exhibit 4.1 to Form S-3 (No. 333-108272), filed on August 27, 2003). |
4.7 | — | Form of First Supplemental Indenture dated as of November 15, 2013 to Indenture dated as of August 26, 2003 (incorporated by reference to Exhibit 4.2 to Form S-3ASR (No. 333-192369) filed on November 15, 2013). |
4.8 | — | Form of Note for 5.50% Senior Notes due January 15, 2018 (incorporated by reference to Exhibit 4.2 to Form 8-K filed on January 15, 2008). |
4.9 | — | Form of Note for 6.20% Senior Notes due January 15, 2038 (incorporated by reference to Exhibit 4.3 to Form 8-K filed on January 15, 2008). |
4.10 | — | Form of Note for 3.875% Senior Notes due April 1, 2014 (incorporated by reference to Exhibit 4.1 to Form 8-K filed on March 24, 2009). |
4.11 | — | Form of Note for 5.125% Senior Notes due April 1, 2019 (incorporated by reference to Exhibit 4.2 to Form 8-K filed on March 24, 2009). |
4.12 | — | Form of Note for 3.125% Senior Notes due January 15, 2021 (incorporated by reference to Exhibit 4.1 to Form 8-K filed on November 12, 2010). |
4.13 | — | Form of Note for 4.875% Senior Notes due November 15, 2040 (incorporated by reference to Exhibit 4.2 to Form 8-K filed on November 12, 2010). |
4.14 | — | Form of Note for 1.125% Senior Notes due October 1, 2017 (incorporated by reference to Exhibit 4.1 to Form 8-K filed on September 27, 2012). |
4.15 | — | Form of Note for 2.450% Senior Notes due October 1, 2022 (incorporated by reference to Exhibit 4.2 to Form 8-K filed on September 27, 2012). |
4.16 | — | Form of Note for 3.625% Senior Notes due October 1, 2042 (incorporated by reference to Exhibit 4.3 to Form 8-K filed on September 27, 2012). |
10.1 | — | UPS Retirement Plan, as Amended and Restated, effective January 1, 2010 (incorporated by reference to Exhibit 10.2 to the 2009 Annual Report on Form 10-K). |
(1) Amendment No. 1 to the UPS Retirement Plan (incorporated by reference to Exhibit 10.2(1) to the 2010 Annual Report on Form 10-K). | ||
(2) Amendment No. 2 to the UPS Retirement Plan (incorporated by reference to Exhibit 10.1(2) to the 2011 Annual Report on Form 10-K). | ||
(3) Amendment No. 3 to the UPS Retirement Plan (incorporated by reference to Exhibit 10.1(3) to the 2011 Annual Report on Form 10-K). | ||
(4) Amendment No. 4 to the UPS Retirement Plan (incorporated by reference to Exhibit 10.1(4) to the 2012 Annual Report on Form 10-K). | ||
(5) Amendment No. 5 to the UPS Retirement Plan (incorporated by reference to Exhibit 10.1(5) to the 2012 Annual Report on Form 10-K). | ||
†(6) Amendment No. 6 to the UPS Retirement Plan. | ||
†(7) Amendment No. 7 to the UPS Retirement Plan. | ||
†(8) Amendment No. 8 to the UPS Retirement Plan. | ||
†(9) Amendment No. 9 to the UPS Retirement Plan. | ||
10.2 | — | UPS Savings Plan, as Amended and Restated (incorporated by reference to Exhibit 10.3 to 2008 Annual Report on Form 10-K). |
(1) Amendment No. 1 to the UPS Savings Plan (incorporated by reference to Exhibit 10.3(1) to the 2009 Annual Report on Form 10-K). | ||
(2) Amendment No. 2 to the UPS Savings Plan (incorporated by reference to Exhibit 10.3(2) to the 2009 Annual Report on Form 10-K). | ||
(3) Amendment No. 3 to the UPS Savings Plan (incorporated by reference to Exhibit 10.3(3) to the 2010 Annual Report on Form 10-K). | ||
(4) Amendment No. 4 to the UPS Savings Plan (incorporated by reference to Exhibit 10.2(4) to the 2011 Annual Report on Form 10-K). | ||
(5) Amendment No. 5 to the UPS Savings Plan (incorporated by reference to Exhibit 10.2(5) to the 2011 Annual Report on Form 10-K). | ||
(6) Amendment No. 6 to the UPS Savings Plan (incorporated by reference to Exhibit 10.2(6) to the 2012 Annual Report on Form 10-K). | ||
†(7) Amendment No. 7 to the UPS Savings Plan. | ||
10.3 | — | Credit Agreement (364-Day Facility) dated March 29, 2013 among United Parcel Service, Inc., the initial lenders named therein, J.P. Morgan Securities LLC and Citigroup Global Markets, Inc. as joint lead arrangers and joint bookrunners, Barclays Bank PLC and BNP Paribas Securities Corp. as co-lead arrangers, Barclays Bank PLC and BNP Paribas as co-documentation agents, Citibank, N.A. as syndication agent, and JPMorgan Chase Bank, N.A. as administrative agent. (incorporated by reference to Exhibit 10.1 to Form 10-Q for the Quarter Ended March 31, 2013). |
10.4 | — | Credit Agreement (5 Year Facility) dated March 29, 2013 among United Parcel Service, Inc., the initial lenders named therein, J.P. Morgan Securities LLC and Citigroup Global Markets, Inc. as joint lead arrangers and joint bookrunners, Barclays Bank PLC and BNP Paribas Securities Corp. as co-lead arrangers, Barclays Bank PLC and BNP Paribas as co-documentation agents, Citibank, N.A. as syndication agent, and JPMorgan Chase Bank, N.A. as administrative agent. (incorporated by reference to Exhibit 10.2 to Form 10-Q for the Quarter Ended March 31, 2013). |
10.5 | — | UPS Excess Coordinating Benefit Plan, as amended and restated (incorporated by reference to Exhibit 10.5 to the 2012 Annual Report on Form 10-K). |
10.6 | — | United Parcel Service, Inc. 2009 Omnibus Incentive Compensation Plan (incorporated by reference to Annex II to the Definitive Proxy Statement, filed on March 13, 2009). |
(1) Form of Long-Term Incentive Performance Award Agreement (incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 2011). | ||
(2) Form of Non-Management Director Restricted Stock Unit Award (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 2010). | ||
(3) UPS Management Incentive Program Terms and Conditions effective as of January 1, 2011 (incorporated by reference to Exhibit 10.10(3) to the 2010 Annual Report on Form 10-K). | ||
(4) UPS Stock Option Program Terms and Conditions effective as of January 1, 2012 (incorporated by reference to Exhibit 10.7(4) to the 2011 Annual Report on Form 10-K). | ||
(5) UPS Long-Term Incentive Performance Program Terms and Conditions effective as of January 1, 2012 (incorporated by reference to Exhibit 10.7(5) to the 2011 Annual Report on Form 10-K). | ||
10.7 | — | Form of UPS Deferred Compensation Plan (incorporated by reference to Exhibit 10.11 to the 2010 Annual Report on Form 10-K). |
(1) Amendment No. 1 to the UPS Deferred Compensation Plan(incorporated by reference to Exhibit 10.7(1) to the 2012 Annual Report on Form 10-K). | ||
10.8 | — | United Parcel Service, Inc. Nonqualified Employee Stock Purchase Plan (incorporated by reference to Exhibit 99.1 to the registration statement on Form S-8 (No. 333-34054), filed on April 5, 2000). |
10.9 | — | Discounted Employee Stock Purchase Plan, as amended and restated, effective October 1, 2002. |
(1) Amendment No. 1 to the Discounted Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.12(1) to the 2005 Annual Report on Form 10-K). | ||
(2) Amendment No. 2 to the Discounted Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.13(2) to the 2009 Annual Report on Form 10-K). | ||
(3) Amendment No. 3 to the Discounted Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.9(3) to the 2012 Annual Report on Form 10-K). | ||
10.10 | — | 2012 Omnibus Incentive Compensation Plan (incorporated by reference to Annex A to the proxy statement filed on March 12, 2012). |
11 | — | Statement regarding Computation of per Share Earnings (incorporated by reference to note 13 to Part I, Item 8 “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K). |
†12 | — | Ratio of Earnings to Fixed Charges. |
†21 | — | Subsidiaries of the Registrant. |
†23 | — | Consent of Deloitte & Touche LLP. |
†31.1 | — | Certificate of the Chief Executive Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
†31.2 | — | Certificate of the Chief Financial Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
†32.1 | — | Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
†32.2 | — | Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
††101 | — | The following financial information from the Annual Report on Form 10-K for the year ended December 31, 2013, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Cash Flows, and (v) the Notes to the Consolidated Financial Statements. |
† | Filed herewith. |
†† | Filed electronically herewith. |
ATTEST: | UNITED PARCEL SERVICE OF AMERICA, INC. | |||
/s/ Teri P. McClure | /s/ D. Scott Davis | |||
Teri P. McClure | D. Scott Davis | |||
Secretary | Chairman | |||
ATTEST: | UNITED PARCEL SERVICE OF AMERICA, INC. | |||
/s/ Teri P. McClure | /s/ D. Scott Davis | |||
Teri P. McClure | D. Scott Davis | |||
Secretary | Chairman | |||
1. | By amending Section 1.1(zzz), Spouse, effective September 16, 2013, to read as follows: |
2. | By amending the first sentence of Section 5.8(b), Maximum Benefits, effective January 1, 2014, to read as follows: |
3. | By amending Article V, AMOUNT AND PAYMENT OF BENEFITS, effective for Plan Years beginning on and after January 1, 2008, to insert a new Section 5.16, to read as follows: |
4. | By amending the first sentence of Section 5.5(a) of Appendix M to read as follows: |
5. | By amending Section 5.6 of Appendix M, effective for Plan Years beginning on and after January 1, 2008, to read as follows: |
(a) | General. The limitations of this Section 5.6 shall apply effective for Plan Years beginning on or after January 1, 2008 and before January 1, 2010. |
(i) | If a Participant would be entitled to an Unpredictable Contingent Event Benefit payable with respect to an Unpredictable Contingent Event occurring during a Plan Year, such benefit shall not be paid if the AFTAP for such Plan Year: |
(B) | sixty percent (60%) or more, but would be less than sixty percent (60%) if the AFTAP were redetermined applying an actuarial assumption that the likelihood of the occurrence of such event during the Plan Year is one hundred percent (100%). |
(ii) | Section 5.6(b)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Code §§ 436(b)(2) and 436(f) or to the extent Section 5.6(b)(i) is otherwise inapplicable in accordance with Code § 436(f). |
(i) | No amendment that has the effect of increasing the liabilities of the Plan by reason of increases in benefits, establishment of new benefits, changing the rate of benefit accrual, or changing the rate at which benefits become nonforfeitable shall take effect in a Plan Year if the AFTAP for such Plan Year: |
(A) | is less than eighty percent (80%), or |
(B) | is eighty percent (80%) or more, but would be less than eighty percent (80%) if the benefits attributable to the amendment were taken into account in determining the AFTAP. |
(ii) | Section 5.6(c)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Code §§ 436(c)(2) and 436(f) or to the extent Section 5.6(c)(i) is otherwise inapplicable in accordance with Code § 436(f), so that the amendment shall be permitted to take effect as of the later of the first day of the Plan Year or the effective date of the amendment. |
(iii) | Section 5.6(c)(i) shall not apply to any amendment that provides for an increase in benefits under a formula which is not based on a Participant’s compensation, but only if the rate of the increase is not in excess of the contemporaneous rate of increase in average wages of Participants covered by the amendment. |
(i) | Funding Percentage Less than Sixty Percent (60%). If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), the Plan shall not pay any Prohibited Payment after the valuation date for the Plan Year. |
(ii) | Bankruptcy. During any period in which the Plan sponsor is a debtor in a case under Title 11, United States Code, or similar Federal or State law, the Plan shall not pay any Prohibited Payment. The preceding sentence shall not apply on or after the date on which the enrolled actuary for the Plan certifies that the Plan’s AFTAP for the Plan is not less than one hundred percent (100%). |
(iii) | Limited Payment if Percentage is at Least Sixty Percent (60%) but Less Than Eighty Percent (80%). |
(A) | General. If the Plan’s AFTAP for a Plan Year is sixty percent (60%) or greater but less than eighty percent (80%), the Plan shall not pay any Prohibited Payment after the valuation date for the Plan Year to the extent the amount of the payment exceeds the lesser of (1) fifty percent (50%) of the amount of the payment which could be made without regard to Section 5.6(d) or (2) the present value (determined under guidance prescribed by the PBGC, using the interest and mortality assumptions under Code § 417(e)) of the maximum guarantee with respect to the Participant under ERISA Section 4022. |
(B) | One-Time Application. In the case of a Participant with respect to whom a Prohibited Payment (or series of Prohibited Payments under a single optional form of benefit) is made pursuant to Section 5.6(d)(iii)(A), no additional Prohibited Payment shall be made with respect to that Participant during any period of consecutive Plan Years to which the limitations under Section 5.6(d)(i) or (ii) apply. |
(i) | General. If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), benefit accruals under the Plan shall cease as of the valuation date for the Plan Year. If the Plan is required to cease benefit accruals under the preceding sentence, then the Plan shall not be amended in a manner that would increase the liabilities of the Plan by reason of an increase in benefits or establishment of new benefits. |
(ii) | Exemption. Section 5.6(e)(i) shall not apply with respect to a Plan Year, effective as of the first day of the Plan Year, if the Company makes an additional contribution or provides security in accordance with Code §§ 436(e)(2) and 436(f) or to the extent Section 5.6(c)(i) is otherwise inapplicable in accordance with Code § 436(f). |
(iii) | 2009 Plan Year. For the 2009 Plan Year, Section 5.6(e)(i) shall be applied by substituting the Plan’s AFTAP for the preceding Plan Year for the Plan’s AFTAP for the Plan Year, but only if the AFTAP for the preceding Plan Year is greater. |
(f) | Definitions. For purposes of this Section 5.6, the following terms have the following meanings: |
(i) | “AFTAP” means the “Adjusted Funding Target Attainment Percentage,” as described in Code § 436(j)(2), taking into account the special rules of Code § 436(j)(4). |
(ii) | “Prohibited Payment” means (1) any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of Code § 411(a)(9)), to a Participant or Beneficiary whose annuity starting date (as defined in Code § 417(f)(2)) occurs during any period a limitation under Section 5.6(d)(i) or (ii) is in effect, (2) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and (3) any other payment specified by regulations. A prohibited payment shall not include the payment of a benefit which under Code § 411(a)(11) may be immediately distributed without the consent of the Participant. |
(iii) | “Unpredictable Contingent Event” means a plant shutdown (whether full or partial) or similar event, or an event (including the absence of an event) other than the attainment of any age, performance of any service, receipt or derivation of any compensation, or the occurrence of death or disability. |
(iv) | “Unpredictable Contingent Event Benefit” means any benefit payable solely by reason of an Unpredictable Contingent Event. |
(g) | Notices. The Committee or its delegate shall comply with any applicable notice requirements under ERISA Section 101(j). |
(h) | Interpretation. This Section 5.6 shall be interpreted and applied consistent with Code § 436, taking into account any applicable transition rules or exceptions provided thereunder or in any guidance issued thereunder. |
6. | By amending Section 5.7 of Appendix M, effective for Plan Years beginning on and after January 1, 2010, to read as follows: |
(a) | General. The limitations of this Section 5.7 shall apply effective for Plan Years beginning on or after January 1, 2010. |
(i) | If a Participant would be entitled to an Unpredictable Contingent Event Benefit payable with respect to an Unpredictable Contingent Event occurring during a Plan Year, such benefit shall not be paid if the AFTAP for such Plan Year: |
(A) | is less than sixty percent (60%), or |
(B) | is sixty percent (60%) or more, but would be less than sixty percent (60%) if the AFTAP were redetermined applying an actuarial assumption that the likelihood of occurrence of such event during the Plan Year is one hundred percent (100%). |
(ii) | Section 5.7(b)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Treasury Regulation § 1.436-1(f) or to the extent Section 5.7(b)(i) is otherwise inapplicable in accordance with Treasury Regulation § 1.436-1(f). |
(iii) | If the Unpredictable Contingent Event Benefits payable with respect to an Unpredictable Contingent Event that occurs during the Plan Year are not permitted to be paid because of the limitations of Section 5.7(i), but are permitted to be paid later in the Plan Year as a result of additional contributions under Treasury Regulation § 1.436-1(f) or pursuant to the enrolled actuary’s certification of the AFTAP for the Plan Year that meets the requirements of Treasury Regulation § 1.436-1(g)(5)(ii)(B), then those Unpredictable Contingent Event Benefits shall automatically become payable, retroactive to the period those benefits would have been payable under the terms of the Plan (other than Plan terms implementing the requirements of Code § 436(b)). If the Unpredictable Contingent Event Benefits do not become payable during the Plan Year in accordance with the preceding sentence, then the Plan will be treated as if it does not provide for those benefits. However, all or any portion of those Unpredictable Contingent Event Benefits can be restored pursuant to a Plan amendment that meets the requirements of Code § 436(c) and Treasury Regulation § 1.436-1(c) and other applicable qualification requirements. |
(i) | No Plan amendment that has the effect of increasing liabilities of the Plan by reason of increases in benefits, establishment of new benefits, changing the rate of benefit accrual, or changing the rate at which benefits become nonforfeitable shall take place in a Plan Year if the AFTAP for such Plan Year: |
(A) | is less than eighty percent (80%), or |
(B) | is eighty percent (80%) or more, but would be less than eighty percent (80%) if the benefits attributable to the amendment were taken into account in determining the AFTAP. |
(ii) | Section 5.7(c)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Treasury Regulation § 1.436-1(f) or to the extent Section 5.7(c)(i) is otherwise inapplicable in accordance with Treasury Regulation § 1.436-1(f), so that the amendment shall be permitted to take effect as of the later of the first day of the Plan Year or the effective date of the amendment. |
(iii) | Section 5.7(c)(i) shall not apply to any amendment that provides for an increase in benefits under a formula which is not based on a Participant’s compensation, but only if the rate of the increase is not in excess of the contemporaneous rate of increase in average wages of Participants covered by the amendment. |
(iv) | If a Plan amendment does not take effect as of the effective date of the amendment because of the limitations of Section 5.7(c), but is permitted to take effect later in the Plan Year as a result of additional contributions under Treasury Regulation § 1.436-1(f) or pursuant to the enrolled actuary’s certification of the AFTAP for the Plan Year that meets the requirements of Treasury Regulation § 1.436-1(g)(5)(ii)(C), then the Plan amendment shall automatically take effect as of the first day of the Plan Year (or, if later, the original effective date of the amendment). If the Plan amendment cannot take effect during the Plan Year, then it shall be treated as if it were never adopted, unless the Plan amendment provides otherwise. |
(i) | Funding Percentage Less than Sixty Percent (60%). If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), a Participant or Beneficiary shall not be permitted to elect an optional form of benefit that includes a Prohibited Payment, and the Plan shall not pay any Prohibited Payment, with an Annuity Starting Date on or after the applicable Section 436 Measurement Date. |
(ii) | Bankruptcy. During any period in which the Plan sponsor is a debtor in a case under Title 11, United States Code, or similar Federal or State law, no Participant or Beneficiary shall be permitted to elect an optional form of benefit that includes a Prohibited Payment, and the Plan shall not pay any Prohibited Payment with an Annuity Starting Date that occurs during such period. The preceding sentence shall not apply to payments made within a Plan Year with an Annuity Starting Date that occurs on or after the date on which the enrolled actuary for the Plan certifies that the Plan’s AFTAP for that Plan Year is not less than one hundred percent (100%). |
(iii) | Limited Payment if Percentage is at Least Sixty Percent (60%) but Less Than Eighty Percent (80%). |
(A) | General. If the Plan’s AFTAP for a Plan Year is sixty percent (60%) or greater but less than eighty percent (80%), no Participant or Beneficiary shall be permitted to elect an optional form of benefit that includes a Prohibited Payment, and the Plan shall not pay any Prohibited Payment, with an Annuity Starting Date on or after the applicable Section 436 Measurement Date. The preceding sentence shall not apply if the Present Value of Accrued Benefit of the portion of the benefit that is being paid in a Prohibited Payment (as described in Treasury Regulation § 1.436-1(d)(3)(iii)(B)) does not exceed the lesser of (1) fifty percent (50%) of the Present Value of Accrued Benefit of the benefit payable in the optional form of benefit that includes the Prohibited Payment or (2) one hundred percent (100%) of the PBGC maximum benefit guarantee amount (as described in Treasury Regulation § 1.436-1(d)(3)(iii)(C)). |
(B) | Bifurcation Rules. If an optional form of benefit that is otherwise available under the terms of the Plan is not available as of the Annuity Starting Date because of the application of Section 5.7(d)(iii)(A), then the Participant or Beneficiary shall be permitted to elect to (1) receive the unrestricted portion of the optional form of benefit (determined under the rules of Treasury Regulation § 1.436-1(d)(3)(iii)(D)) at that Annuity Starting Date, determined by treating the unrestricted portion of the benefit as if it were the Participant’s or Beneficiary’s entire benefit under the Plan, (2) commence benefits with respect to the Participant’s or Beneficiary’s entire benefit under the Plan in any other optional form of benefit available under the Plan at the same Annuity Starting Date that satisfies Treasury Regulation § 1.436-1(d)(3)(i), or (3) defer commencement of the payments to the extent described in Treasury Regulation § 1.436-1(d)(5). If the Participant or Beneficiary elects payment of the unrestricted portion of the benefit (determined under the rules of Treasury Regulation § 1.436-1(d)(3)(iii)(D)) under Section 5.7(d)(iii)(B)(1), then the Participant or Beneficiary shall be entitled to elect payment of the remainder of the Participant’s or Beneficiary’s benefits under the Plan in any optional form of benefit at that Annuity Starting Date otherwise available under the Plan that would not have included a Prohibited Payment if that optional form applied to the entire benefit of the Participant or Beneficiary. |
(C) | One-Time Application. In the case of a Participant or Beneficiary with respect to whom a Prohibited Payment (or series of Prohibited Payments under a single optional form of benefit) is made pursuant to Section 5.7(d)(iii)(A) or (B), no additional Prohibited Payment shall be made with respect to that Participant during any period of consecutive Plan Years to which the limitations under Section 5.7(d) apply. |
(iv) | Plan Alternative for Special Optional Forms. The Plan may offer optional forms of benefit that are solely available during the period in which Section 5.7(d)(i), (ii), or (iii) applies to limit Prohibited Payments under the Plan in accordance with Treasury Regulation § 1.436-1(d)(6). Any such optional forms must satisfy Treasury Regulation § 1.436-1(d) and applicable qualification requirements, including satisfaction of Code §§ 417(e) and 415 (at each annuity starting date). |
(i) | General. If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), benefit accruals under the Plan shall cease as of the applicable Section 436 Measurement Date. If the Plan is required to cease benefit accruals under the preceding sentence, then the Plan shall not be amended in a manner that would increase the liabilities of the Plan by reason of an increase in benefits or establishment of new benefits. |
(ii) | Exemption. Section 5.7(e)(i) shall cease to apply with respect to a Plan Year, effective as of the first day of the Plan Year, if the Company makes an additional contribution or provides security in accordance within Treasury Regulation § 1.436-1(f) or to the extent Section 5.7(e)(i) is otherwise inapplicable in accordance with Treasury Regulation § 1.436-1(f). |
(i) | Periods Prior to Certification During Which a Presumption Applies. For any period during which a presumption under Code § 436(h) and Treasury Regulation §§ 1.436-1(h)(1), (2) or (3) applies to the Plan, the limitations under Sections 5.7(b), (c), (d) and (e) shall be applied to the Plan as if the AFTAP for the year were the presumed AFTAP determined under the rules of Code § 436(h) and Treasury Regulation § 1.436-1(h)(1), (2) or (3), as applicable, updated to take into account certain Unpredictable Contingent Event Benefits and Plan amendments in accordance with Code § 436 and Treasury Regulation § 1.436-1(g). |
(ii) | Periods After Certification of AFTAP. Section 5.7(f)(i) shall no longer apply for a Plan Year on and after the date an enrolled actuary for the Plan issues a certification of the AFTAP of the Plan for the current Plan Year, provided that the certification is issued before the first day of the tenth (10th) month of the Plan Year. For example, the limitations on Prohibited Payments under Section 5.7(d) shall apply for distributions with Annuity Starting Dates on and after the date of such certification using the certified AFTAP of the Plan for the Plan Year. Similarly, the prohibitions on accruals under Section 5.7(e) as a result of the enrolled actuary’s certification that the AFTAP of the Plan for the Plan Year is less than sixty percent (60%) shall be effective as of the date of the certification, and any prohibition on accruals shall cease to be effective on the date the enrolled actuary issues a certification that the AFTAP for the Plan for the Plan Year is at least sixty percent (60%). |
(i) | “AFTAP” means the “Adjusted Funding Target Attainment Percentage,” as described in Code § 436(j)(2), taking into account the special rules of Code § 436(j)(4), and Treasury Regulation § 1.436-1(j)(1). |
(ii) | “Annuity Starting Date” has the meaning described in Treasury Regulation § 1.436-1(j)(2). |
(iii) | “Prohibited Payment” means (1) any payment for a month that is in excess of the monthly amount paid under a straight life annuity (plus any social security supplements described in the last sentence of Code § 411(a)(9)), to a Participant or Beneficiary whose Annuity Starting Date occurs during any period a limitation under Section 5.7(d) is in effect, (2) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, (3) any transfer of assets and liabilities to another plan maintained by the Company (or by any member of the Company’s controlled group) that is made in order to avoid or terminate the application of the benefit limitations under Code § 436, and (4) any other amount that is identified as a Prohibited Payment in IRS revenue rulings and procedures, notices, and other guidance published in the Internal Revenue Bulletin. A prohibited payment shall not include the payment of a benefit which under Code § 411(a)(11) may be immediately distributed without the consent of the Participant. |
(iv) | “Section 436 Measurement Date” has the meaning described in Treasury Regulation § 1.436-1(j)(8). |
(v) | “Unpredictable Contingent Event” means a plant shutdown (whether full or partial) or similar event, or an event (including the absence of an event) other than the attainment of any age, performance of any service, receipt or derivation of any compensation, or the occurrence of death or disability. |
(vi) | “Unpredictable Contingent Event Benefit” means any benefit or increase in benefits to the extent the benefit or increase would not be payable but for the occurrence of an Unpredictable Contingent Event. |
(h) | Notices. The Committee or its delegate shall comply with any applicable notice requirements under ERISA Section 101(j). |
(i) | Interpretation. This Section 5.7 shall be interpreted and applied consistent with Code § 436 and Treasury Regulation § 1.436-1, taking into account any applicable transition rules or exceptions provided thereunder or in any additional guidance issued under Code § 436. |
7. | By amending the Plan to insert a new Appendix R, Funding Based Limitations on Benefits and Benefit Accrual, effective for Plan Years beginning on or after January 1, 2008, to read as attached. |
8. | Except as amended by this Amendment No. 8, the Plan as in effect immediately prior to the date of this Amendment shall remain in full force and effect. |
ATTEST: | UNITED PARCEL SERVICE OF AMERICA, INC. | |||
/s/ Teri P. McClure | /s/ D. Scott Davis | |||
Teri P. McClure | D. Scott Davis | |||
Secretary | Chairman | |||
(a) | General. The limitations of this Section 1.1 shall apply effective for Plan Years beginning on or after January 1, 2008 and before January 1, 2010. |
(i) | If a Participant would be entitled to an Unpredictable Contingent Event Benefit payable with respect to an Unpredictable Contingent Event occurring during a Plan Year, such benefit shall not be paid if the AFTAP for such Plan Year: |
(B) | sixty percent (60%) or more, but would be less than sixty percent (60%) if the AFTAP were redetermined applying an actuarial assumption that the likelihood of the occurrence of such event during the Plan Year is one hundred percent (100%). |
(ii) | Section 1.1(b)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Code §§ 436(b)(2) and 436(f) or to the extent Section 1.1(b)(i) is otherwise inapplicable in accordance with Code § 436(f). |
(i) | No amendment that has the effect of increasing the liabilities of the Plan by reason of increases in benefits, establishment of new benefits, changing the rate of benefit accrual, or changing the rate at which benefits become nonforfeitable shall take effect in a Plan Year if the AFTAP for such Plan Year: |
(B) | is eighty percent (80%) or more, but would be less than eighty percent (80%) if the benefits attributable to the amendment were taken into account in determining the AFTAP. |
(ii) | Section 1.1(c)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Code §§ 436(c)(2) and 436(f) or to the extent Section 1.1(c)(i) is otherwise inapplicable in accordance with Code § 436(f), so that the amendment shall be permitted to take effect as of the later of the first day of the Plan Year or the effective date of the amendment. |
(iii) | Section 1.1(c)(i) shall not apply to any amendment that provides for an increase in benefits under a formula which is not based on a Participant’s compensation, but only if the rate of the increase is not in excess of the contemporaneous rate of increase in average wages of Participants covered by the amendment. |
(i) | Funding Percentage Less than Sixty Percent (60%). If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), the Plan shall not pay any Prohibited Payment after the valuation date for the Plan Year. |
(ii) | Bankruptcy. During any period in which the Plan sponsor is a debtor in a case under Title 11, United States Code, or similar Federal or State law, the Plan shall not pay any Prohibited Payment. The preceding sentence shall not apply on or after the date on which the enrolled actuary for the Plan certifies that the Plan’s AFTAP for the Plan is not less than one hundred percent (100%). |
(iii) | Limited Payment if Percentage is at Least Sixty Percent (60%) but Less Than Eighty Percent (80%). |
(A) | General. If the Plan’s AFTAP for a Plan Year is sixty percent (60%) or greater but less than eighty percent (80%), the Plan shall not pay any Prohibited Payment after the valuation date for the Plan Year to the extent the amount of the payment exceeds the lesser of (1) fifty percent (50%) of the amount of the payment which could be made without regard to Section 1.1(d) or (2) the present value (determined under guidance prescribed by the PBGC, using the interest and mortality assumptions under Code § 417(e)) of the maximum guarantee with respect to the Participant under ERISA Section 4022. |
(B) | One-Time Application. In the case of a Participant with respect to whom a Prohibited Payment (or series of Prohibited Payments under a single optional form of benefit) is made pursuant to Section 1.1(d)(iii)(A), no additional Prohibited Payment shall be made with respect to that Participant during any period of consecutive Plan Years to which the limitations under Section 1.1(d)(i) or (ii) apply. |
(i) | General. If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), benefit accruals under the Plan shall cease as of the valuation date for the Plan Year. If the Plan is required to cease benefit accruals under the preceding sentence, then the Plan shall not be amended in a manner that would increase the liabilities of the Plan by reason of an increase in benefits or establishment of new benefits. |
(ii) | Exemption. Section 1.1(e)(i) shall not apply with respect to a Plan Year, effective as of the first day of the Plan Year, if the Company makes an additional contribution or provides security in accordance with Code § § 436(e)(2) and 436(f) or to the extent Section 1.1(c)(i) is otherwise inapplicable in accordance with Code § 436(f). |
(iii) | 2009 Plan Year. For the 2009 Plan Year, Section 1.1(e)(i) shall be applied by substituting the Plan’s AFTAP for the preceding Plan Year for the Plan’s AFTAP for the Plan Year, but only if the AFTAP for the preceding Plan Year is greater. |
(f) | Definitions. For purposes of this Section 1.1, the following terms have the following meanings: |
(i) | “AFTAP” means the “Adjusted Funding Target Attainment Percentage,” as described in Code § 436(j)(2), taking into account the special rules of Code § 436(j)(4). |
(ii) | “Prohibited Payment” means (1) any payment, in excess of the monthly amount paid under a single life annuity (plus any social security supplements described in the last sentence of Code § 411(a)(9)), to a Participant or Beneficiary whose annuity starting date (as defined in Code § 417(f)(2)) occurs during any period a limitation under Section 1.1(d)(i) or (ii) is in effect, (2) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, and (3) any other payment specified by regulations. A prohibited payment shall not include the payment of a benefit which under Code § 411(a)(11) may be immediately distributed without the consent of the Participant. |
(iii) | “Unpredictable Contingent Event” means a plant shutdown (whether full or partial) or similar event, or an event (including the absence of an event) other than the attainment of any age, performance of any service, receipt or derivation of any compensation, or the occurrence of death or disability. |
(iv) | “Unpredictable Contingent Event Benefit” means any benefit payable solely by reason of an Unpredictable Contingent Event. |
(g) | Notices. The Committee or its delegate shall comply with any applicable notice requirements under ERISA Section 101(j). |
(h) | Interpretation. This Section 1.1 shall be interpreted and applied consistent with Code § 436, taking into account any applicable transition rules or exceptions provided thereunder or in any guidance issued thereunder. |
(a) | General. The limitations of this Section 1.2 shall apply effective for Plan Years beginning on or after January 1, 2010. |
(i) | If a Participant would be entitled to an Unpredictable Contingent Event Benefit payable with respect to an Unpredictable Contingent Event occurring during a Plan Year, such benefit shall not be paid if the AFTAP for such Plan Year: |
(B) | is sixty percent (60%) or more, but would be less than sixty percent (60%) if the AFTAP were redetermined applying an actuarial assumption that the likelihood of occurrence of such event during the Plan Year is one hundred percent (100%). |
(ii) | Section 1.2(b)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Treasury Regulation § 1.436-1(f) or to the extent Section 1.2(b)(i) is otherwise inapplicable in accordance with Treasury Regulation § 1.436-1(f). |
(iii) | If the Unpredictable Contingent Event Benefits payable with respect to an Unpredictable Contingent Event that occurs during the Plan Year are not permitted to be paid because of the limitations of Section 1.2(i), but are permitted to be paid later in the Plan Year as a result of additional contributions under Treasury Regulation § 1.436-1(f) or pursuant to the enrolled actuary’s certification of the AFTAP for the Plan Year that meets the requirements of Treasury Regulation § 1.436-1(g)(5)(ii)(B), then those Unpredictable Contingent Event Benefits shall automatically become payable, retroactive to the period those benefits would have been payable under the terms of the Plan (other than Plan terms implementing the requirements of Code § 436(b)). If the Unpredictable Contingent Event Benefits do not become payable during the Plan Year in accordance with the preceding sentence, then the Plan will be treated as if it does not provide for those benefits. However, all or any portion of those Unpredictable Contingent Event Benefits can be restored pursuant to a Plan amendment that meets the requirements of Code § 436(c) and Treasury Regulation § 1.436-1(c) and other applicable qualification requirements. |
(i) | No Plan amendment that has the effect of increasing liabilities of the Plan by reason of increases in benefits, establishment of new benefits, changing the rate of benefit accrual, or changing the rate at which benefits become nonforfeitable shall take place in a Plan Year if the AFTAP for such Plan Year: |
(B) | is eighty percent (80%) or more, but would be less than eighty percent (80%) if the benefits attributable to the amendment were taken into account in determining the AFTAP. |
(ii) | Section 1.2(c)(i) shall cease to apply with respect to a Plan Year if the Company makes an additional contribution or provides security in accordance with Treasury Regulation § 1.436-1(f) or to the extent Section 1.2(c)(i) is otherwise inapplicable in accordance with Treasury Regulation § 1.436-1(f), so that the amendment shall be permitted to take effect as of the later of the first day of the Plan Year or the effective date of the amendment. |
(iii) | Section 1.2(c)(i) shall not apply to any amendment that provides for an increase in benefits under a formula which is not based on a Participant’s compensation, but only if the rate of the increase is not in excess of the contemporaneous rate of increase in average wages of Participants covered by the amendment. |
(iv) | If a Plan amendment does not take effect as of the effective date of the amendment because of the limitations of Section 1.2(c), but is permitted to take effect later in the Plan Year as a result of additional contributions under Treasury Regulation § 1.436-1(f) or pursuant to the enrolled actuary’s certification of the AFTAP for the Plan Year that meets the requirements of Treasury Regulation § 1.436-1(g)(5)(ii)(C), then the Plan amendment shall automatically take effect as of the first day of the Plan Year (or, if later, the original effective date of the amendment). If the Plan amendment cannot take effect during the Plan Year, then it shall be treated as if it were never adopted, unless the Plan amendment provides otherwise. |
(i) | Funding Percentage Less than Sixty Percent (60%). If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), a Participant or Beneficiary shall not be permitted to elect an optional form of benefit that includes a Prohibited Payment, and the Plan shall not pay any Prohibited Payment, with an Annuity Starting Date on or after the applicable Section 436 Measurement Date. |
(ii) | Bankruptcy. During any period in which the Plan sponsor is a debtor in a case under Title 11, United States Code, or similar Federal or State law, no Participant or Beneficiary shall be permitted to elect an optional form of benefit that includes a Prohibited Payment, and the Plan shall not pay any Prohibited Payment with an Annuity Starting Date that occurs during such period. The preceding sentence shall not apply to payments made within a Plan Year with an Annuity Starting Date that occurs on or after the date on which the enrolled actuary for the Plan certifies that the Plan’s AFTAP for that Plan Year is not less than one hundred percent (100%). |
(iii) | Limited Payment if Percentage is at Least Sixty Percent (60%) but Less Than Eighty Percent (80%). |
(A) | General. If the Plan’s AFTAP for a Plan Year is sixty percent (60%) or greater but less than eighty percent (80%), no Participant or Beneficiary shall be permitted to elect an optional form of benefit that includes a Prohibited Payment, and the Plan shall not pay any Prohibited Payment, with an Annuity Starting Date on or after the applicable Section 436 Measurement Date. The preceding sentence shall not apply if the Present Value of Accrued Benefit of the portion of the benefit that is being paid in a Prohibited Payment (as described in Treasury Regulation § 1.436-1(d)(3)(iii)(B)) does not exceed the lesser of (1) fifty percent (50%) of the Present Value of Accrued Benefit of the benefit payable in the optional form of benefit that includes the Prohibited Payment or (2) one hundred percent (100%) of the PBGC maximum benefit guarantee amount (as described in Treasury Regulation § 1.436-1(d)(3)(iii)(C)). |
(B) | Bifurcation Rules. If an optional form of benefit that is otherwise available under the terms of the Plan is not available as of the Annuity Starting Date because of the application of Section 1.2(d)(iii)(A), then the Participant or Beneficiary shall be permitted to elect to (1) receive the unrestricted portion of the optional form of benefit (determined under the rules of Treasury Regulation § 1.436-1(d)(3)(iii)(D)) at that Annuity Starting Date, determined by treating the unrestricted portion of the benefit as if it were the Participant’s or Beneficiary’s entire benefit under the Plan, (2) commence benefits with respect to the Participant’s or Beneficiary’s entire benefit under the Plan in any other optional form of benefit available under the Plan at the same Annuity Starting Date that satisfies Treasury Regulation § 1.436-1(d)(3)(i), or (3) defer commencement of the payments to the extent described in Treasury Regulation § 1.436-1(d)(5). If the Participant or Beneficiary elects payment of the unrestricted portion of the benefit (determined under the rules of Treasury Regulation § 1.436-1(d)(3)(iii)(D)) under Section 1.2(d)(iii)(B)(1), then the Participant or Beneficiary shall be entitled to elect payment of the remainder of the Participant’s or Beneficiary’s benefits under the Plan in any optional form of benefit at that Annuity Starting Date otherwise available under the Plan that would not have included a Prohibited Payment if that optional form applied to the entire benefit of the Participant or Beneficiary. |
(C) | One-Time Application. In the case of a Participant or Beneficiary with respect to whom a Prohibited Payment (or series of Prohibited Payments under a single optional form of benefit) is made pursuant to Section 1.2(d)(iii)(A) or (B), no additional Prohibited Payment shall be made with respect to that Participant during any period of consecutive Plan Years to which the limitations under Section 1.2(d) apply. |
(iv) | Plan Alternative for Special Optional Forms. The Plan may offer optional forms of benefit that are solely available during the period in which Section 1.2(d)(i), (ii), or (iii) applies to limit Prohibited Payments under the Plan in accordance with Treasury Regulation § 1.436-1(d)(6). Any such optional forms must satisfy Treasury Regulation § 1.436-1(d) and applicable qualification requirements, including satisfaction of Code §§ 417(e) and 415 (at each annuity starting date). |
(i) | General. If the Plan's AFTAP for a Plan Year is less than sixty percent (60%), benefit accruals under the Plan shall cease as of the applicable Section 436 Measurement Date. If the Plan is required to cease benefit accruals under the preceding sentence, then the Plan shall not be amended in a manner that would increase the liabilities of the Plan by reason of an increase in benefits or establishment of new benefits. |
(ii) | Exemption. Section 1.2(e)(i) shall cease to apply with respect to a Plan Year, effective as of the first day of the Plan Year, if the Company makes an additional contribution or provides security in accordance within Treasury Regulation § 1.436-1(f) or to the extent Section 1.2(e)(i) is otherwise inapplicable in accordance with Treasury Regulation § 1.436-1(f). |
(i) | Periods Prior to Certification During Which a Presumption Applies. For any period during which a presumption under Code § 436(h) and Treasury Regulation §§ 1.436-1(h)(1), (2) or (3) applies to the Plan, the limitations under Sections 1.2(b), (c), (d) and (e) shall be applied to the Plan as if the AFTAP for the year were the presumed AFTAP determined under the rules of Code § 436(h) and Treasury Regulation § 1.436-1(h)(1), (2) or (3), as applicable, updated to take into account certain Unpredictable Contingent Event Benefits and Plan amendments in accordance with Code § 436 and Treasury Regulation § 1.436-1(g). |
(ii) | Periods After Certification of AFTAP. Section 1.2(f)(i) shall no longer apply for a Plan Year on and after the date an enrolled actuary for the Plan issues a certification of the AFTAP of the Plan for the current Plan Year, provided that the certification is issued before the first day of the tenth (10th) month of the Plan Year. For example, the limitations on Prohibited Payments under Section 1.2(d) shall apply for distributions with Annuity Starting Dates on and after the date of such certification using the certified AFTAP of the Plan for the Plan Year. Similarly, the prohibitions on accruals under Section 1.2(e) as a result of the enrolled actuary’s certification that the AFTAP of the Plan for the Plan Year is less than sixty percent (60%) shall be effective as of the date of the certification, and any prohibition on accruals shall cease to be effective on the date the enrolled actuary issues a certification that the AFTAP for the Plan for the Plan Year is at least sixty percent (60%). |
(1) | “AFTAP” means the “Adjusted Funding Target Attainment Percentage,” as described in Code § 436(j)(2), taking into account the special rules of Code § 436(j)(4), and Treasury Regulation § 1.436-1(j)(1). |
(2) | “Annuity Starting Date” has the meaning described in Treasury Regulation § 1.436-1(j)(2). |
(3) | “Prohibited Payment” means (1) any payment for a month that is in excess of the monthly amount paid under a straight life annuity (plus any social security supplements described in the last sentence of Code § 411(a)(9)), to a Participant or Beneficiary whose Annuity Starting Date occurs during any period a limitation under Section 1.2(d) is in effect, (2) any payment for the purchase of an irrevocable commitment from an insurer to pay benefits, (3) any transfer of assets and liabilities to another plan maintained by the Company (or by any member of the Company’s controlled group) that is made in order to avoid or terminate the application of the benefit limitations under Code § 436, and (4) any other amount that is identified as a Prohibited Payment in IRS revenue rulings and procedures, notices, and other guidance published in the Internal Revenue Bulletin. A prohibited payment shall not include the payment of a benefit which under Code § 411(a)(11) may be immediately distributed without the consent of the Participant. |
(4) | “Section 436 Measurement Date” has the meaning described in Treasury Regulation § 1.436-1(j)(8). |
(5) | “Unpredictable Contingent Event” means a plant shutdown (whether full or partial) or similar event, or an event (including the absence of an event) other than the attainment of any age, performance of any service, receipt or derivation of any compensation, or the occurrence of death or disability. |
(6) | “Unpredictable Contingent Event Benefit” means any benefit or increase in benefits to the extent the benefit or increase would not be payable but for the occurrence of an Unpredictable Contingent Event. |
(h) | Notices. The Committee or its delegate shall comply with any applicable notice requirements under ERISA Section 101(j). |
(i) | Interpretation. This Section 1.2 shall be interpreted and applied consistent with Code § 436 and Treasury Regulation § 1.436-1, taking into account any applicable transition rules or exceptions provided thereunder or in any additional guidance issued under Code § 436. |
1. | By deleting Addendum A, Benefit Schedule II for Independent Pilots Association, of Appendix M in its entirety and inserting a new Addendum A, Benefit Schedule II for Independent Pilots Association, to read as attached. |
2. | Except as amended by this Amendment No. 9, the Plan as in effect immediately prior to the date of this Amendment shall remain in full force and effect. |
ATTEST: | UNITED PARCEL SERVICE OF AMERICA, INC. | |||
/s/ Teri P. McClure | /s/ D. Scott Davis | |||
Teri P. McClure | D. Scott Davis | |||
Secretary | Chairman | |||
(a) | per diem payments; |
(b) | grievance awards (other than the following: (A) as a part of a Crewmember’s Guarantee or Bidline Credit, (B) an award of Premium Pay for Revisions or (C) an award of Late Arrival Pay); |
(c) | amounts paid to a Crewmember as a result of the application of Code § 415(c); |
(d) | payments in the nature of compensation from an insurance carrier, from a state unemployment or worker’s compensation fund, or from any health and welfare or other benefit program or plan maintained by an Employer or a Related Employer. |
(e) | disability payments from an insurance carrier, a state disability insurance fund, this Plan or any other disability plan maintained by an Employer or a Related Employer; |
(f) | foreign service differentials or other supplemental payments made by an Employer or Related Employer to a Crewmember working outside his or her country of citizenship on account of such foreign service; |
(g) | payment or reimbursement by an Employer or Related Employer for relocation expenses incurred by a Crewmember or his or her family; |
(h) | the value of employee fringe benefits provided by an Employer or Related Employer, including but not limited to the payment of life insurance premiums, whether or not the value of such fringe benefits is includable in the employee’s taxable income; |
(i) | payments made under deferred compensation plans or programs; |
(j) | Employer or Related Employer contributions to any pension, profit-sharing or stock bonus plan; and |
(k) | Employer or Related Employer contributions to any welfare benefit plan. |
Hours of Covered Employment In Each Plan Year | Monthly Units of Service Credit |
Less than 81 | 0 |
81-162 | 3 months |
163-243 | 4 months |
244-324 | 5 months |
325-405 | 6 months |
406-487 | 7 months |
488-568 | 8 months |
569-649 | 9 months |
650-730 | 10 months |
731-812 | 11 months |
813 or more | 12 months |
(a) | General. Each Participant (other than a 2014 Participant, a 2006 Participant or a 2003 Retired Participant) shall have a Monthly Single Life Benefit equal to one percent (1%) of his Final Average Earnings times his number of full and fractional years of Service Credit (not to exceed 30 years of Service Credit). |
(b) | 2006 Participants and 2003 Retired Participants. Each 2006 Participant and each 2003 Retired Participant shall have a Monthly Single Life Benefit equal to A times B, where |
Rank | Dollar Amount |
Captain or Bypassed Captain | $3,000 |
First Officer, Professional Flight Engineer or a Bypassed Crewmember | $2,400 |
Second Officer | $2,100 |
(c) | 2014 Participants. For each 2014 Participant (other than a Pre-2014 Early Retiree), the Monthly Single Life Benefit formula described in Section 4.2(b) shall be used to calculate his Retirement Benefit instead of the formula described in Section 4.2(a). |
(d) | Pre-2014 Early Retirees. |
(i) | The Early Retirement Benefit of each Pre-2014 Early Retiree shall be recalculated under Section 4.5 in the form of a Single Life Only Annuity using the Monthly Single Life Benefit formula described in Section 4.2(b) reduced for early commencement as of the Early Retirement Commencement Date (unless the Pre-2014 Early Retiree was entitled to an unreduced Early Retirement Benefit pursuant to Addendum A, Voluntary Job Protection Memorandum of Understanding dated April 29, 2009, as Amended, Benefit Enhancements) and further reduced by the Other Plan Benefits Offset (the “Recalculated Early Retirement Benefit”). |
(ii) | If a Pre-2014 Early Retiree’s Recalculated Early Retirement Benefit is larger than his Initial Early Retirement Benefit, the Pre-2014 Early Retiree shall be entitled to an additional benefit (the “Additional Early Retirement Benefit”) under this Section 4.2(d) payable beginning March 1, 2014 as a Single Life Only Annuity equal to (A) +(B) where: |
(A) | is the excess of his monthly Recalculated Early Retirement Benefit over his monthly Initial Early Retirement Benefit (the “Monthly Excess”); and is the monthly benefit payable under a Single Life Only Annuity beginning March 1, 2014 that is Actuarially Equivalent to the sum of (I) the Monthly Excess which would have been paid from his Early Retirement Commencement Date through February 28, 2014 and (II) compound interest at 7% per year applied to each Monthly Excess payment from the first day of the calendar month in which the payment would have otherwise have been made through February 28, 2014. |
(iii) | The Additional Early Retirement Benefit shall be paid in the normal form of benefit described in Section 4.9 unless the Participant properly waives the normal form as described in Section 4.9, in which case his Additional Early Retirement Benefit shall be paid in the following Special Optional Form: |
(A) | If the Pre-2014 Early Retiree is receiving his Initial Early Retirement Benefit in the form of a Single Life Only Annuity, the portion of the Additional Early Retirement described in Section 4.2(d)(ii)(A) shall be added to his monthly Initial Early Retirement Benefit effective as of March 1, 2014. If the Pre-2014 Early Retiree is receiving his Initial Early Retirement Benefit in a form other than a Single Life Only Annuity, the portion of the Additional Early Retirement Benefit described in Section 4.2(d)(ii)(A) shall be converted to the Actuarial Equivalent form of benefit in which his Initial Early Retirement Benefit is being paid and shall be added to his monthly Initial Early Retirement Benefit effective as of March 1, 2014. |
(B) | Additionally, no later than March 1, 2014, the Plan will pay a lump sum amount (the “True-Up Payment”) equal to the sum described in Section 4.2(d)(ii)(B). |
(iv) | If a Pre-2014 Early Retiree dies prior to March 1, 2014, the Monthly Excess that would have been paid to the deceased Pre-2014 Early Retiree from his Early Retirement Commencement Date through his date of death with compound interest at 7% per year applied to each Monthly Excess payment from the first day of the calendar month in which the payment would have otherwise have been made through February 28, 2014 shall be paid in a lump sum to his estate on March 1, 2014. |
(v) | If a Pre-2014 Early Retiree dies prior to March 1, 2014 and he is survived by a spouse who is entitled to a survivor annuity under the Qualified Joint and Survivor Annuity form of benefit, his surviving spouse shall be entitled to an additional monthly survivor annuity payable beginning March 1, 2014 for her life only equal to the additional monthly benefit that would have been payable to her following the Pre-2014 Early Retiree’s death if the Additional Early Retirement Benefit had been paid in the Qualified Joint and Survivor Annuity form from the Pre-2014 Early Retiree’s Early Retirement Commencement Date unless the surviving spouse consents to have the additional monthly survivor annuity paid in the same form as the survivor benefit payable under the Initial Early Retirement Benefit beginning as of March 1, 2014 with a lump sum payment for any additional monthly survivor benefit that would have been paid to her after the death of the Pre-2014 Early Retiree through February 28, 2014. If the surviving spouse elects the alternative form of survivor annuity, the portion of the Additional Early Retirement Benefit described in Section 4.2(d)(ii)(A) shall be converted to the Actuarial Equivalent form of benefit in which the deceased Pre-2014 Early Retiree’s Initial Early Retirement Benefit is being paid and the monthly survivor benefit attributable to such annuity shall be added to the surviving spouse’s monthly survivor annuity effective as of March 1, 2014. Additionally, such surviving spouse will receive a lump sum payment equal to the sum of the additional monthly survivor annuity that would have been paid to her from the date of the Pre-2014 Early Retiree’s death to February 28, 2014 with compound interest at 7% per year applied to each monthly payment from the first day of the calendar month in which the payment otherwise would have been made to such surviving spouse through February 28, 2014. |
(vi) | Whether an alternate payee will be entitled to a payment under this Section 4.2(d) will depend on the terms of the qualified domestic relations order. |
(e) | Minimum Benefit - Notwithstanding Sections 4.2(a) and (b), the Monthly Single Life Benefit for each Participant who participated in Benefit Schedule I shall never be less than his Monthly Single Life Benefit accrued under Benefit Schedule I as of August 30, 2006. |
(a) | Retirement Benefits Payable in Annuity Form. If the Retirement Benefit is payable in an annuity form, the amount of the reduction shall be determined and subtracted from the Retirement Benefit as of the later of the date as of which Retirement Benefits commence under the Plan or the earliest date such Participant could begin receiving benefits under such Other Plan (the “Determination Date”). Thus, if a Participant is not eligible for a benefit under an Other Plan when he begins receiving benefits under this Plan, his Retirement Benefit will not be reduced until the earliest date he could have begun receiving a benefit under the Other Plan. The amount of the reduction shall be equal to the Monthly Single Life Benefit that would have been payable under the Other Plan as of the Determination Date or, if the Monthly Single Life Benefit is not available under such Other Plan, the Monthly Single Life Benefit which is the Actuarial Equivalent of the normal form of benefit that would have been payable under such Other Plan as of the Determination Date. If a Participant begins receiving a benefit under an Other Plan before the Determination Date, the amount of the reduction will be actuarially adjusted. |
(b) | Retirement Benefit Payable in Lump Sum. If the Retirement Benefit is payable in a lump sum, the Present Value of the Retirement Benefit payable under this Plan shall be reduced by the Present Value of the benefit actually paid to such Participant or payable to him under such Other Plan. |
(c) | Estimation. If the Committee determines that it is not reasonably practicable to obtain the actual amount of the benefit payable to or on behalf of a Participant under an Other Plan in sufficient time to make payment of his benefit under this Plan, the Committee may estimate the amount of the Other Plan benefit using such methods as they in their discretion deem appropriate. If the Committee estimates the Other Plan benefit, they shall use their best efforts to obtain the actual amount of the Other Plan benefit and adjust the benefit being paid from this Plan accordingly. In the event that the estimated Other Plan benefit is less than the actual Other Plan benefit, the Committee shall reduce the payments under this Plan immediately to reflect the amount of the difference and may recover any previous overpayments from this Plan by deducting such overpayments from future benefit payments due under this Plan or by such other methods as the Committee deems appropriate. In the event that the estimated Other Plan benefit is larger than the actual Other Plan benefit, the Committee shall increase the payments under this Plan immediately to reflect the amount that of such difference and shall make an additional payment equal to the amount that would have been received if the Plan had used the actual Other Plan benefit from the commencement of payment. |
(a) | Joint and Survivor Annuity. The benefit under a Joint and Survivor Annuity shall be the Actuarial Equivalent of a Single Life Only Annuity based on the life of the Participant. Under the Joint and Survivor Annuity, the Participant shall be paid his pension for his lifetime; and his designated beneficiary as of the date of the Participant’s retirement, if surviving at the Participant’s death, shall be entitled to receive thereafter a lifetime survivorship benefit in a monthly amount equal to a percentage (50%, 66 2/3%, 75%, or 100%, as selected by the Participant) of the monthly amount which had been payable to the Participant. The last payment of the Joint and Survivor Annuity shall be made as of the first day of the month in which the death of the last to die of the Participant and his designated beneficiary has occurred. A Participant may not elect to receive payment of his Retirement Benefit in the form of a Joint and Survivor Annuity if he has a non-spousal beneficiary and such beneficiary is younger than the Participant by more than the maximum number of years specified in the following table based on their ages on their birthdays in the calendar year in which benefit payments commence: |
Annuity Form | Maximum Number of Years |
Joint and 100% Survivor Annuity | 10 years |
Joint and 75% Survivor Annuity | 19 years |
Joint and 66 2/3% Survivor Annuity | 25 years |
(b) | Period Certain and Continuous Annuity. The benefit under a Period Certain and Continuous Annuity shall be the Actuarial Equivalent of a Single Life Only Annuity based on the life of the Participant. Under the Period Certain and Continuous Annuity, the Participant shall be paid his pension for his lifetime; and if the Participant dies before receiving a specified number of monthly payments (120, 180, 240, as selected by the Participant (“guaranteed payments”)), the Participant’s designated beneficiary shall be entitled to receive thereafter a monthly guaranteed payment equal to the payment which had been payable to the Participant until all of the monthly payments have been made from the Plan to the Participant and his designated beneficiary. The last payment of the Period Certain and Continuous Annuity shall be made as of the first day of the month in which occurs the later of the death of the Participant or the last of the guaranteed monthly payments has been made. Each Participant who selects this option shall designate a beneficiary in writing, in the form and manner required by the Committee, and such beneficiary may be changed by such Participant in the same manner, but such designation shall not be considered made until received by the Committee or its designees on such form and unless it is received by the Committee prior to the Participant’s death. |
(c) | Level Income Option. The benefit under a Level Income Option shall be the Actuarial Equivalent of a Monthly Single Life Benefit based on the life of the Participant. Under the Level Income Option, the Participant shall be paid a higher benefit until age 62 or 65, as selected by the Participant, and a reduced benefit after age 62 or 65, as applicable, to provide a more level income over the Participant’s lifetime, taking into account the social security primary insurance benefits the Participant is expected to receive at the selected age. The last payment of the Level Income Option shall be made as of the first day of the month in which the death of the Participant occurs. |
1. | Section 9.8(c)(1), Financial Need, is hereby amended, effective October 26, 2012, by deleting the “or” at the end of Section 9.8(c)(1)(vi), deleting the “.” at the end of Section 9.8(c)(1)(vii) and replacing it with a “, or” and inserting a new Section 9.8(c)(1)(viii) at the end of such Section to read as follows: |
ATTEST: | UNITED PARCEL SERVICE OF AMERICA, INC. | |||
/s/ Teri P. McClure | /s/ D. Scott Davis | |||
Teri P. McClure | D. Scott Davis | |||
Secretary | Chairman | |||
Date: December 12, 2013 | Date: December 12, 2013 |
Year Ended December 31, | ||||||||||||||||
2013 | 2012 | 2011 | 2010 | 2009 | ||||||||||||
Earnings: | ||||||||||||||||
Income before income taxes | $ | 6,674 | $ | 974 | $ | 5,776 | $ | 5,290 | $ | 3,073 | ||||||
Add: Interest expense | 380 | 393 | 348 | 354 | 445 | |||||||||||
Add: Interest factor in rental expense | 192 | 206 | 210 | 205 | 207 | |||||||||||
Total earnings | $ | 7,246 | $ | 1,573 | $ | 6,334 | $ | 5,849 | $ | 3,725 | ||||||
Fixed charges: | ||||||||||||||||
Interest expense | $ | 380 | $ | 393 | $ | 348 | $ | 354 | $ | 445 | ||||||
Interest capitalized | 14 | 18 | 17 | 18 | 37 | |||||||||||
Interest factor in rental expense | 192 | 206 | 210 | 205 | 207 | |||||||||||
Total fixed charges | $ | 586 | $ | 617 | $ | 575 | $ | 577 | $ | 689 | ||||||
Ratio of earnings to fixed charges | 12.4 | 2.5 | 11.0 | 10.1 | 5.4 | |||||||||||
Name of Subsidiary | Jurisdiction of Organization |
BT Property Holdings, Inc. | Delaware |
BT Realty II, Inc. | Maryland |
BT Realty, Inc. | Maryland |
C.C. & E.I., L.L.C. | Delaware |
UPS Asia Group Pte. Ltd. | Singapore |
United Parcel Service Canada Ltd. | Canada |
United Parcel Service Co. | Delaware |
United Parcel Service Deutschland Inc. | Delaware |
United Parcel Service France SNC | France |
United Parcel Service General Services Co. | Delaware |
United Parcel Service Italia SRL | Italy |
United Parcel Service of America, Inc. | Delaware |
United Parcel Service, Inc. | Ohio |
UPICO Corporation | Delaware |
UPINSCO, Inc. | Virgin Islands |
UPS Capital Business Credit | Connecticut |
UPS Cartage Services, Inc. | Delaware |
UPS Ground Freight, Inc. | Virginia |
UPS Limited | United Kingdom |
UPS Parcel Delivery (Guangdong) Co., LTD. | China (PRC) |
UPS SCS GmbH & Co OHG | Germany |
UPS SCS Holding Limited | Hong Kong |
UPS SCS (Nederland) B.V. | Netherlands |
UPS SCS, Inc. | Canada |
UPS Supply Chain Solutions, Inc. | Delaware |
UPS Supply Chain Solutions General Services, Inc. | Delaware |
UPS Worldwide Forwarding, Inc. | Delaware |
1. | I have reviewed this annual report on Form 10-K of United Parcel Service, Inc.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |
(a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
(b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
(c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
(d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |
(a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | |
(b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/S/ D. SCOTT DAVIS |
D. Scott Davis Chairman and Chief Executive Officer |
1. | I have reviewed this annual report on Form 10-K of United Parcel Service, Inc.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |
(a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
(b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
(c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
(d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |
(a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | |
(b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/S/ KURT P. KUEHN |
Kurt P. Kuehn Chief Financial Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation. |
/S/ D. SCOTT DAVIS |
D. Scott Davis Chairman and Chief Executive Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation. |
/S/ KURT P. KUEHN |
Kurt P. Kuehn Chief Financial Officer |
`CE+B4\MM3IK
M=1P9M2:0W,8ZJAO`IU92#Q#F,H<^R<44.HYS"(CMVB(CINF/!"]4N+*]3#*(
M;N%BIP%93*!MR@6L5\``!V[-OFWL[=;T1^*#JEQ9ZX^[3=;%,U?3@(95`I"M
MW494:FQ?-BIIF1(5I(-H5)^TV2,)-TE"#TF$/2.L<(\#>N7R9+%8YI<@Z0H5
M6)R5>%%P-L9[,7>V7-8K8QCBHV;Q.2Y>^4I`IO$$H'&(.HD78$C$Z2=*O'$U
M9)%M,;>;)D*'6:L\@15?M4>50B`JR[!>OS9TCD.521EKM3&CR),=!;I,5LSH
MR8*$W**I1V/I7B>S&61;H)5B/GUQ[RFW;`ZL0X^D5U$FXDN:T (<2,`(H(I)13:P>`!.@I$3&ZB#R;16
M@J@KR=6&1HG&WC9Y>V%
M*D<#'C;;%MT6%KB%RB(JIJ1\XBL4GB`4ZJ`IK;`50NY%UB@DJ2:!+\IO+?5L
MLE8,B8.D$23;Y=S+2V/YA84DY9ZX.9P\<5R95,*2$@Z5,8YFSL2)**&$2+$$
M0(,LF*K;C
'QIIMU\+_AIHWQ`N];
M\3_95D\1Z1
&=`\.6Y\!ZWK/AN.WN]7\O0XV+)!Y8\PVUTTD
M$4XC5G"`C)&XY
KVM_NUXIX3_Y2+^._^R;^'/\`TYZ]0![91110`4444`%%%%`#
M2F30J;:=11Y@'2FE,FG44``&!1110`4444`%%%%`!1110`4444`%%%%`!111
M0`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`
M!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%
M%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`44
M44`%%%%`!1110`4444`%>"?L'?\`-9O^RI:W_P"T*][KP3]@[_FLW_94M;_]
MH4`>]T444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`C_=KQ3P
MG_RD7\=_]DW\.?\`ISUZO:W^[7BGA/\`Y2+^._\`LF_AS_TYZ]0![91110`4
M444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!11
M10`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%
M`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`
M%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4
M444`%%%%`!1110`5X)^P=_S6;_LJ6M_^T*][KP3]@[_FLW_94M;_`/:%`'O=
M%%%`!1110`4444`%%%%`!1110`4444`%%?)/_!8#]J3QM^RQ^SM;:IX3U"3P
MM:ZE)>0:KXM71VU;_A&DCL;B:!_)`*J9IXXX?.E4Q1;RS?PUP?CK]MWX@:#\
M*/@S]L^)'P_M=*\<'4FU'XD>&M/_`+Z9J6G
MG[/):KYZQO`P\Q&,;?*"0?I^]\`:+JW@N;PW>:797N@W-F=/FL+F(36\]N4\
MLQ.K9#*4^4@YR.M<7\&OV1/A_P#`+79-4\,Z+=0ZF]DNFQW5_J][JDUI:!@P
MMH&NI93!#D*3'%M0E%R#M7%$GIB-NS]>*Y?Q1XYU;0M9-K9^$=9UJ$('-U;7
M5G''G^[B69'R/7;CWKJ@,"FF-
CASH AND INVESTMENTS - Summary of Marketable Securities (Detail) (USD $)
In Millions, unless otherwise specified |
12 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2013
|
Dec. 31, 2013
Current marketable securities
|
Dec. 31, 2012
Current marketable securities
|
Dec. 31, 2013
Current marketable securities
U.S. government and agency debt securities
|
Dec. 31, 2012
Current marketable securities
U.S. government and agency debt securities
|
Dec. 31, 2013
Current marketable securities
Mortgage and asset-backed debt securities
|
Dec. 31, 2012
Current marketable securities
Mortgage and asset-backed debt securities
|
Dec. 31, 2013
Current marketable securities
Corporate debt securities
|
Dec. 31, 2012
Current marketable securities
Corporate debt securities
|
Dec. 31, 2013
Current marketable securities
U.S. state and local municipal debt securities
|
Dec. 31, 2012
Current marketable securities
U.S. state and local municipal debt securities
|
Dec. 31, 2013
Current marketable securities
Other debt and equity securities
|
Dec. 31, 2012
Current marketable securities
Other debt and equity securities
|
|
Schedule of Available-for-sale Securities [Line Items] | |||||||||||||
Document Fiscal Year Focus | 2013 | ||||||||||||
Cost | $ 582 | $ 582 | $ 587 | $ 355 | $ 236 | $ 76 | $ 171 | $ 146 | $ 158 | $ 2 | $ 15 | $ 3 | $ 7 |
Unrealized Gains | 2 | 10 | 0 | 2 | 1 | 3 | 1 | 5 | 0 | 0 | 0 | 0 | |
Unrealized Losses | (4) | 0 | (1) | 0 | (2) | 0 | (1) | 0 | 0 | 0 | 0 | 0 | |
Estimated Fair Value | $ 580 | $ 597 | $ 354 | $ 238 | $ 75 | $ 174 | $ 146 | $ 163 | $ 2 | $ 15 | $ 3 | $ 7 |
COMPANY-SPONSORED EMPLOYEE BENEFIT PLANS - Fair Values of U.S. Pension and Postretirement Benefit Plan Assets by Asset Category as Well as the Percentage That Each Category Comprises of Total Plan Assets and the Respective Target Allocations (Detail) (USD $)
In Millions, unless otherwise specified |
12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2013
|
Dec. 31, 2012
|
Dec. 31, 2013
Fair Value, Inputs, Level 1
|
Dec. 31, 2012
Fair Value, Inputs, Level 1
|
Dec. 31, 2013
Fair Value, Inputs, Level 2
|
Dec. 31, 2012
Fair Value, Inputs, Level 2
|
Dec. 31, 2013
Fair Value, Inputs, Level 3
|
Dec. 31, 2012
Fair Value, Inputs, Level 3
|
Dec. 31, 2011
Fair Value, Inputs, Level 3
|
Dec. 31, 2013
Fair Value, Inputs, Level 3
Global Bonds
|
Dec. 31, 2012
Fair Value, Inputs, Level 3
Global Bonds
|
Dec. 31, 2011
Fair Value, Inputs, Level 3
Global Bonds
|
Dec. 31, 2013
Fair Value, Inputs, Level 3
Hedge Funds
|
Dec. 31, 2012
Fair Value, Inputs, Level 3
Hedge Funds
|
Dec. 31, 2011
Fair Value, Inputs, Level 3
Hedge Funds
|
Dec. 31, 2013
Fair Value, Inputs, Level 3
Other(2)
|
Dec. 31, 2012
Fair Value, Inputs, Level 3
Other(2)
|
Dec. 31, 2011
Fair Value, Inputs, Level 3
Other(2)
|
Dec. 31, 2013
Fair Value, Inputs, Level 3
Structured Products(1)
|
Dec. 31, 2012
Fair Value, Inputs, Level 3
Structured Products(1)
|
Dec. 31, 2011
Fair Value, Inputs, Level 3
Structured Products(1)
|
Dec. 31, 2013
Fair Value, Inputs, Level 3
Other
|
Dec. 31, 2012
Fair Value, Inputs, Level 3
Other
|
Dec. 31, 2011
Fair Value, Inputs, Level 3
Other
|
Dec. 31, 2013
U.S. Postretirement Medical Benefits
|
Dec. 31, 2012
U.S. Postretirement Medical Benefits
|
Dec. 31, 2013
Domestic
|
Dec. 31, 2012
Domestic
|
Dec. 31, 2013
Domestic
Cash and Cash Equivalents
|
Dec. 31, 2012
Domestic
Cash and Cash Equivalents
|
Dec. 31, 2013
Domestic
Fair Value, Inputs, Level 1
|
Dec. 31, 2012
Domestic
Fair Value, Inputs, Level 1
|
Dec. 31, 2013
Domestic
Fair Value, Inputs, Level 1
Cash and Cash Equivalents
|
Dec. 31, 2012
Domestic
Fair Value, Inputs, Level 1
Cash and Cash Equivalents
|
Dec. 31, 2013
Domestic
Fair Value, Inputs, Level 2
|
Dec. 31, 2012
Domestic
Fair Value, Inputs, Level 2
|
Dec. 31, 2013
Domestic
Fair Value, Inputs, Level 2
Cash and Cash Equivalents
|
Dec. 31, 2012
Domestic
Fair Value, Inputs, Level 2
Cash and Cash Equivalents
|
Dec. 31, 2013
Domestic
Fair Value, Inputs, Level 3
|
Dec. 31, 2012
Domestic
Fair Value, Inputs, Level 3
|
Dec. 31, 2013
Domestic
Fair Value, Inputs, Level 3
Cash and Cash Equivalents
|
Dec. 31, 2012
Domestic
Fair Value, Inputs, Level 3
Cash and Cash Equivalents
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
U.S. Large Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
U.S. Large Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
U.S. Small Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
U.S. Small Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Emerging Markets
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Emerging Markets
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Global Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Global Equity
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
International Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
International Equity
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
U.S. Large Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
U.S. Large Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
U.S. Small Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
U.S. Small Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
Emerging Markets
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
Emerging Markets
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
Global Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
Global Equity
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
International Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 1
International Equity
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
U.S. Large Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
U.S. Large Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
U.S. Small Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
U.S. Small Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
Emerging Markets
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
Emerging Markets
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
Global Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
Global Equity
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
International Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 2
International Equity
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
U.S. Large Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
U.S. Large Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
U.S. Small Cap
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
U.S. Small Cap
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
Emerging Markets
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
Emerging Markets
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
Global Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
Global Equity
|
Dec. 31, 2013
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
International Equity
|
Dec. 31, 2012
Domestic
Equity Securities [Member]
Fair Value, Inputs, Level 3
International Equity
|
Dec. 31, 2013
Domestic
Fixed Income Securities
|
Dec. 31, 2012
Domestic
Fixed Income Securities
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Global Equity
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Global Equity
|
Dec. 31, 2013
Domestic
Fixed Income Securities
U.S. Government Securities
|
Dec. 31, 2012
Domestic
Fixed Income Securities
U.S. Government Securities
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Global Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Global Bonds
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Municipal Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Municipal Bonds
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
Global Equity
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
Global Equity
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
U.S. Government Securities
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
U.S. Government Securities
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
Global Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
Global Bonds
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
Municipal Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 1
Municipal Bonds
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
Global Equity
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
Global Equity
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
U.S. Government Securities
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
U.S. Government Securities
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
Global Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
Global Bonds
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
Municipal Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 2
Municipal Bonds
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
Global Equity
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
Global Equity
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
U.S. Government Securities
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
U.S. Government Securities
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
Global Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
Global Bonds
|
Dec. 31, 2013
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
Municipal Bonds
|
Dec. 31, 2012
Domestic
Fixed Income Securities
Fair Value, Inputs, Level 3
Municipal Bonds
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Hedge Funds
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Hedge Funds
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Other(2)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Other(2)
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Asset-backed Securities [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Structured Products [Member]
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Structured Products [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Other
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Other
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Hedge Funds
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Hedge Funds
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Other(2)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Other(2)
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Asset-backed Securities [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Structured Products [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Other
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 1
Other
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Hedge Funds
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Hedge Funds
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Other(2)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Other(2)
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Asset-backed Securities [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Structured Products [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Other
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 2
Other
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Hedge Funds
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Hedge Funds
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Other(2)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Other(2)
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Structured Products(1)
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Asset-backed Securities [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Structured Products [Member]
|
Dec. 31, 2013
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Other
|
Dec. 31, 2012
Domestic
Other Investments [Member]
Fair Value, Inputs, Level 3
Other
|
Dec. 31, 2013
International [Member]
|
Dec. 31, 2012
International [Member]
|
Dec. 31, 2013
International [Member]
Cash and Cash Equivalents
|
Dec. 31, 2012
International [Member]
Cash and Cash Equivalents
|
Dec. 31, 2013
International [Member]
Fair Value, Inputs, Level 1
|
Dec. 31, 2012
International [Member]
Fair Value, Inputs, Level 1
|
Dec. 31, 2013
International [Member]
Fair Value, Inputs, Level 1
Cash and Cash Equivalents
|
Dec. 31, 2012
International [Member]
Fair Value, Inputs, Level 1
Cash and Cash Equivalents
|
Dec. 31, 2013
International [Member]
Fair Value, Inputs, Level 2
|
Dec. 31, 2012
International [Member]
Fair Value, Inputs, Level 2
|
Dec. 31, 2013
International [Member]
Fair Value, Inputs, Level 2
Cash and Cash Equivalents
|
Dec. 31, 2012
International [Member]
Fair Value, Inputs, Level 2
Cash and Cash Equivalents
|
Dec. 31, 2013
International [Member]
Fair Value, Inputs, Level 3
|
Dec. 31, 2012
International [Member]
Fair Value, Inputs, Level 3
|
Dec. 31, 2013
International [Member]
Fair Value, Inputs, Level 3
Cash and Cash Equivalents
|
Dec. 31, 2012
International [Member]
Fair Value, Inputs, Level 3
Cash and Cash Equivalents
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
local market equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
local market equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
U.S. Equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
U.S. Equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Emerging Markets
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
International Equity
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
International Equity
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
local market equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
local market equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
U.S. Equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
U.S. Equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
Emerging Markets
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
International Equity
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 1
International Equity
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
local market equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
local market equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
U.S. Equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
U.S. Equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
Emerging Markets
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
International Equity
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 2
International Equity
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
local market equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
local market equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
U.S. Equity [Domain]
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
U.S. Equity [Domain]
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
Emerging Markets
|
Dec. 31, 2013
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
International Equity
|
Dec. 31, 2012
International [Member]
Equity Securities [Member]
Fair Value, Inputs, Level 3
International Equity
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Foreign Government Debt [Member]
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Foreign Government Debt [Member]
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Global Bonds
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Global Bonds
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 1
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 1
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 1
Foreign Government Debt [Member]
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 1
Foreign Government Debt [Member]
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 1
Global Bonds
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 1
Global Bonds
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 2
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 2
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 2
Foreign Government Debt [Member]
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 2
Foreign Government Debt [Member]
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 2
Global Bonds
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 2
Global Bonds
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 3
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 3
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 3
Foreign Government Debt [Member]
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 3
Foreign Government Debt [Member]
|
Dec. 31, 2013
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 3
Global Bonds
|
Dec. 31, 2012
International [Member]
Fixed Income Securities
Fair Value, Inputs, Level 3
Global Bonds
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Structured Products(1)
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Structured Products(1)
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Asset-backed Securities [Member]
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Asset-backed Securities [Member]
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Structured Products [Member]
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Structured Products [Member]
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Other
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Other
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 1
Structured Products(1)
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 1
Structured Products(1)
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 1
Asset-backed Securities [Member]
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 1
Asset-backed Securities [Member]
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 1
Other
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 1
Other
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 2
Structured Products(1)
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 2
Structured Products(1)
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 2
Asset-backed Securities [Member]
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 2
Asset-backed Securities [Member]
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 2
Other
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 2
Other
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 3
Structured Products(1)
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 3
Structured Products(1)
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 3
Asset-backed Securities [Member]
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 3
Asset-backed Securities [Member]
|
Dec. 31, 2013
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 3
Other
|
Dec. 31, 2012
International [Member]
Other Investments [Member]
Fair Value, Inputs, Level 3
Other
|
||||||||||||||||||||||||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value of plan assets | $ 27,510 | $ 26,202 | $ 12,080 | $ 11,496 | $ 8,170 | $ 7,873 | $ 7,260 | $ 6,833 | $ 5,158 | $ 223 | $ 138 | $ 80 | $ 3,738 | $ 2,829 | $ 2,132 | $ 1,397 | $ 1,416 | $ 1,354 | $ 1,091 | $ 1,039 | $ 948 | $ 811 | $ 1,411 | $ 644 | $ 355 | $ 460 | $ 26,579 | $ 25,401 | $ 626 | $ 242 | $ 11,669 | $ 11,139 | $ 112 | $ 103 | $ 7,705 | $ 7,478 | $ 514 | $ 139 | $ 7,205 | $ 6,784 | $ 0 | $ 0 | $ 10,462 | $ 9,852 | $ 4,212 | $ 4,710 | $ 507 | $ 481 | $ 1,367 | $ 1,283 | $ 2,154 | $ 2,242 | $ 2,222 | $ 1,136 | $ 7,519 | $ 6,842 | $ 2,264 | $ 2,548 | $ 457 | $ 450 | $ 1,247 | $ 1,160 | $ 2,154 | $ 2,242 | $ 1,397 | $ 442 | $ 2,943 | $ 3,010 | $ 1,948 | $ 2,162 | $ 50 | $ 31 | $ 120 | $ 123 | $ 0 | $ 0 | $ 825 | $ 694 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 7,877 | $ 8,251 | $ 681 | $ 457 | $ 4,361 | $ 4,451 | $ 2,780 | $ 3,260 | $ 55 | $ 83 | $ 3,753 | $ 4,017 | $ 0 | $ 0 | $ 3,746 | $ 4,008 | $ 7 | $ 9 | $ 0 | $ 0 | $ 3,901 | $ 4,096 | $ 681 | $ 457 | $ 615 | $ 443 | $ 2,550 | $ 3,113 | $ 55 | $ 83 | $ 223 | $ 138 | $ 0 | $ 0 | $ 0 | $ 0 | $ 223 | $ 138 | $ 0 | $ 0 | $ 3,738 | $ 2,829 | $ 1,397 | $ 1,416 | $ 1,397 | $ 1,239 | $ 210 | $ 326 | [1] | $ 756 | [2] | $ 1,362 | [2] | $ 0 | $ 0 | $ 0 | $ 0 | $ 285 | $ 177 | $ 0 | $ 0 | [1] | $ 0 | [2] | $ 0 | [2] | $ 0 | $ 0 | $ 0 | $ 0 | $ 21 | $ 23 | $ 210 | $ 326 | [1] | $ 0 | [2] | $ 0 | [2] | $ 3,738 | $ 2,829 | $ 1,397 | $ 1,416 | $ 1,091 | $ 1,039 | $ 0 | $ 0 | [1] | $ 756 | [2] | $ 1,362 | [2] | $ 931 | $ 801 | $ 28 | $ 22 | $ 411 | $ 357 | $ 11 | $ 5 | $ 465 | $ 395 | $ 17 | $ 17 | $ 55 | $ 49 | $ 0 | $ 0 | $ 422 | $ 341 | $ 219 | $ 197 | $ 17 | $ 14 | $ 19 | $ 167 | $ 130 | $ 246 | $ 203 | $ 122 | $ 118 | $ 17 | $ 14 | $ 19 | $ 88 | $ 71 | $ 176 | $ 138 | $ 97 | $ 79 | $ 0 | $ 0 | $ 0 | $ 79 | $ 59 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 239 | $ 219 | $ 68 | $ 64 | $ 171 | $ 155 | $ 154 | $ 149 | $ 68 | $ 64 | $ 86 | $ 85 | $ 85 | $ 70 | $ 0 | $ 0 | $ 85 | $ 70 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 63 | $ 46 | $ 55 | $ 49 | $ 124 | [2] | $ 124 | [2] | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | [2] | $ 0 | [2] | $ 63 | $ 46 | $ 0 | $ 0 | $ 124 | [2] | $ 124 | [2] | $ 0 | $ 0 | $ 55 | $ 49 | $ 0 | [2] | $ 0 | [2] | ||||||||||
Percentage of Plan Assets | 100.00% | 100.00% | 2.30% | 0.90% | 39.40% | 38.80% | 29.60% | 32.50% | 14.10% | 11.10% | 5.30% | 5.60% | 5.30% | 4.90% | 0.80% | 1.20% | [1] | 2.80% | [2] | 5.40% | [2] | 100.00% | 100.00% | 3.00% | 2.80% | 45.30% | 42.60% | 25.70% | 27.30% | 6.80% | 5.70% | 5.90% | 6.10% | 13.30% | [2] | 15.50% | [2] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Plan assets target allocation, Minimum | 0.00% | 0.00% | 25.00% | 35.00% | 15.00% | 25.00% | 8.00% | 5.00% | 3.00% | 1.00% | 3.00% | 1.00% | 0.00% | [1] | 0.00% | [1] | 1.00% | [2] | 1.00% | [2] | 0.00% | 0.00% | 50.00% | 50.00% | 15.00% | 15.00% | 0.00% | 0.00% | 0.00% | [1] | 0.00% | [1] | 0.00% | [2] | 0.00% | [2] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Plan assets target allocation, Maximum | 5.00% | 5.00% | 55.00% | 55.00% | 35.00% | 35.00% | 15.00% | 15.00% | 10.00% | 10.00% | 10.00% | 10.00% | 5.00% | [1] | 5.00% | [1] | 10.00% | [2] | 10.00% | [2] | 5.00% | 5.00% | 65.00% | 65.00% | 35.00% | 35.00% | 17.00% | 17.00% | 10.00% | [1] | 10.00% | [1] | 20.00% | [2] | 20.00% | [2] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Plan assets target allocation | 100.00% | 100.00% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
COMPANY-SPONSORED EMPLOYEE BENEFIT PLANS - Weighted Average Actuarial Assumptions Used to Determine the Benefit Obligations (Detail)
|
12 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Dec. 31, 2013
|
Dec. 31, 2013
U.S. Pension Benefits
|
Dec. 31, 2012
U.S. Pension Benefits
|
Dec. 31, 2013
U.S. Postretirement Medical Benefits
|
Dec. 31, 2012
U.S. Postretirement Medical Benefits
|
Dec. 31, 2013
International Pension Benefits
|
Dec. 31, 2012
International Pension Benefits
|
|
Defined Benefit Plan Disclosure [Line Items] | |||||||
Document Fiscal Year Focus | 2013 | ||||||
Discount rate | 5.32% | 4.42% | 5.14% | 4.21% | 4.40% | 4.00% | |
Rate of compensation increase | 4.29% | 4.16% | 3.30% | 3.03% |
&PO=V]R:W-H
M965T 84@L?(
MF6UD1A@1M=@O6=),YM..L,@T:#H%S/-%%2NRDJ4<&=D[HRF^H5#6P)=FRI&V
MO`9ICD1S!=^V?W\T^8JVK?NQ'D?0(:FVX:G
MOK^LX[@K3[PNNDA<>`-7#J*MBQY^ML>XN[2\V*N;ZG-,DV09UT75A)AAW3Z2
M0QP.5B[1Y+<:_KY"]MQZM_$22I#TX"
MY02^E9,@6D1!G*S^CY=0>8%OY84%BV`5LWCY,1]R7S\2WKLOVVX7<'F@R8
MM[=,M"S;@&>1B"B&@N3"^%58)0:66UA]W;,D8EOO%7*;*]!A`D01:8\0)8&X
M0W!(R"AX'U2LTJ!A3!T>;$A`$:F-")<#A)"`78](R`R$_I`!8=VY,/?C#!C!
M#@B"SP&T'F+)1*9S",(F(FSZE(C5G0M[&@)`'4(:XX`@4;S7?;!F!LF4F)?^
M:KB;Q(>N'F6CCR]6K?C1X$'N\8"@I8S_$+`PH?:4VGU?%Y4P6$XR$*L6`^T!
M&2`HE`R2Q+"F8^O2U]DCT1,2W>P&8;58Z+Y"%@@:=P.+F$XW-H0-TBU#"(E'
MCC&@H_845DHH&546^2!FS$>'0C)S"$)F/4M&6#^<%03-L9E#$#8,='^4F[Y9
MY3)-RL2T*!0V"VBQT:S$S);O=`NC\CDP0,$SYM6<%WDS/%!P8)A9MY3:5_[`
MD"9!*)UND($""J!!P1B)`T,44F"1V1?$O'HO!T+;-`%S9)@P6]4P9T:AQFT!
M-;.*@K[&*$V99F5:1YDMI(FO7>"\*-!T%!R860@E0@75R@Z*(@S@6-D-Z3[`
M7Q.1PUE&
+IG!P8HA!\-32^7@D%L='+*B%73H_'GA92A!!H\
MC$@'A1IW!
"#SQ#LY8Y,\+')X5<$3A+P!\XKSK+\09PW`<
MM_\/``#__P,`4$L#!!0`!@`(````(0`&]_G)[P,``'D.```9````>&PO=V]R
M:W-H965T