Postretirement Plans

9 Months Ended

Oct. 07, 2023

Retirement Benefits [Abstract]

Postretirement Plans

18. POSTRETIREMENT PLANS

The following summarizes the company’s Condensed Consolidated Balance Sheets related pension and other postretirement benefit plan accounts at October 7, 2023 compared to accounts at December 31, 2022 (amounts in thousands):

	October 7, 2023			December 31, 2022
Noncurrent benefit asset	$	5,650		$	4,902
Current benefit liability	$	710		$	710
Noncurrent benefit liability	$	5,504		$	5,814
AOCI, net of tax	$	(770	)	$	(625	)

Defined Benefit Plans and Nonqualified Plan

The company sponsors two pension plans, the Flowers Foods, Inc. Retirement Plan No. 2, and the Tasty Baking Company Supplemental Executive Retirement Plan (“Tasty SERP”). The Tasty SERP is frozen and has only retirees and beneficiaries remaining in the plan.

The company used a measurement date of December 31, 2022 for the defined benefit and postretirement benefit plans described below.

The company made voluntary contributions of $1.0 million to Plan No. 2 during the third quarter of Fiscal 2023 and Fiscal 2022.

The net periodic pension cost for the company’s plans include the following components (amounts in thousands):

	For the Twelve Weeks Ended						For the Forty Weeks Ended
	October 7, 2023			October 8, 2022			October 7, 2023			October 8, 2022
Service cost	$	157		$	274		$	524		$	914
Interest cost		301			204			1,003			680
Expected return on plan assets		(360	)		(432	)		(1,200	)		(1,441	)
Amortization of prior service cost		13			13			44			43
Amortization of net loss		40			107			133			356
Total net periodic pension cost	$	151		$	166		$	504		$	552

The components of total net periodic benefit cost other than the service cost are included in the other components of net periodic pension and postretirement benefit plans credit line item on our Condensed Consolidated Statements of Income (Loss).

Postretirement Benefit Plan

The company provides certain health care and life insurance benefits for eligible retired employees covered under the active medical plans. The plan incorporates an up-front deductible, coinsurance payments and retiree contributions at various premium levels. Eligibility and maximum period of coverage is based on age and length of service.

The net periodic postretirement expense for the company includes the following components (amounts in thousands):

	For the Twelve Weeks Ended						For the Forty Weeks Ended
	October 7, 2023			October 8, 2022			October 7, 2023			October 8, 2022
Service cost	$	41		$	50		$	137		$	165
Interest cost		54			25			182			85
Amortization of prior service credit		(53	)		(54	)		(179	)		(180	)
Amortization of net gain		(57	)		(41	)		(190	)		(137	)
Total net periodic postretirement credit	$	(15	)	$	(20	)	$	(50	)	$	(67	)

The components of total net periodic postretirement benefits credit other than the service cost are included in the other components of net periodic pension and postretirement benefit plans credit line item on our Condensed Consolidated Statements of Income (Loss).

401(k) Retirement Savings Plan

The Flowers Foods, Inc. 401(k) Retirement Savings Plan covers substantially all the company’s employees who have completed certain service requirements. The total cost and employer contributions were as follows (amounts in thousands):

	For the Twelve Weeks Ended				For the Forty Weeks Ended
	October 7, 2023		October 8, 2022		October 7, 2023		October 8, 2022
Total cost and employer contributions	$	7,083	$	6,511	$	24,152	$	22,664

Multi-employer Pension Plan

On July 19, 2022, the company announced the closure of the Holsum Bakery in Phoenix, Arizona. The bakery produced bread and bun products and ceased production on October 31, 2022. As a result, the union participants of the IAM National Pension Fund (the “IAM Fund”) at the Phoenix bakery will withdraw from the IAM Fund. The company recorded a liability of $1.3 million for the withdrawal from the IAM Fund. While this is our best estimate of the ultimate cost of the withdrawal from this plan, additional withdrawal liability may be incurred based on the final IAM Fund assessment or in the event of a mass withdrawal, as defined by statute, occurring anytime up to July 19, 2025.