XML 112 R24.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Retirement Benefits
 12 Months Ended
Dec. 31, 2019
Retirement Benefits [Abstract]  
Retirement Benefits Retirement Benefits

We sponsor two defined benefit pension plans covering specific groups of employees in Canada and the U.S.

The benefits for the pension plan in Canada are based primarily on an employee’s years of service and an average of the employee’s highest five years of earnings. Participating employees in the pension plan in Canada are vested after two years of service or immediately, depending on the province of their employment. We fund the pension plan in Canada in accordance with the rules and regulations of the Pension Benefits Act of the Province of Ontario, Canada. Canada pension plan assets consist principally of equity securities, corporate and government related securities, and insurance contracts. We are in the process of closing the Pension Plan for the employees of Outfront Media Canada LP (the “Plan”). Employees who are no longer accruing pensionable service under the Plan will be entitled to enhanced Defined Contribution Plan benefits. As of April 1, 2020, the Plan will be closed to most new employees. In addition, effective April 1, 2020, the Plan will be frozen to any future benefit accruals for most employees. However, certain members of the Plan will continue in pensionable service for a yet to be determined period. We expect to complete freezing the Plan in 2022.

The pension plan in the U.S. covers a small number of hourly employees. The investments of the pension plan in the U.S. consist entirely of the plan’s interest in a trust, which invests the assets of this plan. The pension plan in the U.S. is funded in accordance with requirements of the Employee Retirement Income Security Act of 1974, as amended.

We use a December 31 measurement date for all pension plans.

The following table sets forth the change in benefit obligation for our pension plans.
 
 
As of December 31,
(in millions)
 
2019
 
2018
 
2017
Benefit obligation, beginning of year
 
$
49.9

 
$
57.8

 
$
48.3

Service cost
 
1.7

 
1.8

 
1.6

Interest cost
 
2.1

 
2.0

 
2.0

Actuarial (gain) loss
 
8.8

 
(5.6
)
 
3.7

Benefits paid
 
(2.6
)
 
(2.0
)
 
(1.4
)
Cumulative translation adjustments
 
2.2

 
(4.1
)
 
3.6

Benefit obligation, end of year
 
$
62.1

 
$
49.9

 
$
57.8



The following table sets forth the change in plan assets for our pension plans.
 
 
As of December 31,
(in millions)
 
2019
 
2018
Fair value of plan assets, beginning of year
 
$
47.5

 
$
52.3

Actual return on plan assets
 
8.8

 
(0.9
)
Employer contributions
 
1.5

 
2.0

Benefits paid
 
(2.6
)
 
(2.0
)
Cumulative translation adjustments
 
2.1

 
(3.9
)
Fair value of plan assets, end of year
 
$
57.3

 
$
47.5



The unfunded status of pension benefit obligations and the related amounts recognized on the Consolidated Statement of Financial Position were as follows:
 
 
As of December 31,
(in millions)
 
2019
 
2018
Unfunded status, end of year
 
$
(4.7
)
 
$
(2.4
)
Amounts recognized on the Consolidated Statement of Financial Position:
 
 
 
 
Other noncurrent liabilities
 
(4.7
)
 
(2.4
)
Net amounts recognized
 
(4.7
)
 
(2.4
)


The following amounts were recognized in accumulated other comprehensive loss on the Consolidated Statement of Financial Position.
 
 
As of December 31,
(in millions)
 
2019
 
2018
Net actuarial loss
 
$
(11.6
)
 
$
(9.3
)
Deferred income taxes
 
2.9

 
2.3

Net amount recognized in accumulated other comprehensive loss
 
$
(8.7
)
 
$
(7.0
)


The accumulated benefit obligation for the defined benefit pension plans was $57.6 million as of December 31, 2019, and $46.9 million as of December 31, 2018.

The information for the pension plans with an accumulated benefit obligation in excess of plan assets is set forth below.
 
 
As of December 31,
(in millions)
 
2019
 
2018
Projected benefit obligation
 
$
62.1

 
$
49.9

Accumulated benefit obligation
 
57.6

 
46.9

Fair value of plan assets
 
57.3

 
47.5



The following tables present the components of net periodic pension cost and amounts recognized in other comprehensive income (loss).
 
 
As of December 31,
(in millions)
 
2019
 
2018
 
2017
Service cost
 
$
1.7

 
$
1.8

 
$
1.6

Interest cost
 
2.1

 
2.0

 
2.0

Expected return on plan assets
 
(2.4
)
 
(2.6
)
 
(2.3
)
Amortization of actuarial losses(a)
 
0.4

 
0.7

 
0.6

Amortization of transitional obligation
 
—

 
—

 
(0.1
)
Settlement cost
 
—

 
0.1

 
—

Net periodic pension cost
 
$
1.8

 
$
2.0

 
$
1.8


(in millions)
 
Year Ended December 31, 2019
Actuarial gains
 
$
(2.3
)
Amortization of actuarial losses(a)
 
0.4

Cumulative translation adjustments
 
(0.4
)
 
 
(2.3
)
Deferred income taxes
 
0.6

Recognized in other comprehensive income, net of tax
 
$
(1.7
)

(a)
Reflects amounts reclassified from accumulated other comprehensive income (loss) to net income.

Estimated net actuarial losses related to the defined benefit pension plans of approximately $0.4 million, will be amortized from accumulated other comprehensive loss into net periodic pension costs in 2020.
 
 
As of and for the Year Ended December 31,
 
 
2019
 
2018
Weighted average assumptions used to determine benefit obligations:
 
 
 
 
Discount rate
 
3.0
%
 
4.0
%
Rate of compensation increase
 
3.0

 
3.0

Weighted average assumptions used to determine net periodic cost:
 
 
 
 
Discount rate
 
4.0

 
3.5

Expected long-term return on plan assets
 
5.0

 
5.1

Rate of compensation increase
 
3.0

 
3.0



For each pension plan, the discount rate is determined based on the yield on portfolios of high quality bonds, constructed to provide cash flows necessary to meet the expected future benefit payments, as determined for the projected benefit obligation. The expected return on plan assets assumption was derived using the current and expected asset allocation of the pension plan assets and considering historical as well as expected returns on various classes of plan assets.

Plan Assets

Our plan assets are included in a trust in Canada and a trust in the U.S. The asset allocations of these trusts are based upon an analysis of the timing and amount of projected benefit payments, projected company contributions, the expected returns and risk of the asset classes and the correlation of those returns. As of December 31, 2019, we invested approximately 32% in fixed income instruments, 60% in equity instruments, and the remainder in cash, cash equivalents and insurance contracts.

The following tables set forth our pension plan assets measured at fair value on a recurring basis as of December 31, 2019 and 2018. These assets have been categorized according to the three-level fair value hierarchy established by the FASB which prioritizes the inputs used in measuring fair value. Level 1 is based on quoted prices for the asset in active markets. Level 2 is based on inputs that are observable other than quoted market prices in active markets, such as quoted prices for the asset in inactive markets or quoted prices for similar assets. Level 3 is based on unobservable inputs that market participants would use in pricing the asset.
 
 
As of December 31, 2019
(in millions)
 
Level 1
 
Level 2
 
Level 3
 
Total
Fixed income securities:
 
 
 
 
 
 
 
 
Corporate bonds(a)
 
$
0.8

 
$
—

 
$
—

 
$
0.8

Equity securities:
 
 
 
 
 
 
 
 
U.S. equity
 
0.8

 
—

 
—

 
0.8

International equity
 
0.3

 
—

 
—

 
0.3

Insurance contracts
 
—

 
—

 
3.7

 
3.7

Total assets in fair value hierarchy
 
$
1.9

 
$
—

 
$
3.7

 
$
5.6

Common collective funds measured at net asset value
 
 
 
 
 
 
 
51.7

Total assets
 
 
 
 
 
 
 
$
57.3

 
 
As of December 31, 2018
(in millions)
 
Level 1
 
Level 2
 
Level 3
 
Total
Fixed income securities:
 
 
 
 
 
 
 
 
Corporate bonds(a)
 
$
0.7

 
$
—

 
$
—

 
$
0.7

Equity securities:
 
 
 
 
 
 
 
 
U.S. equity
 
0.6

 
—

 
—

 
0.6

International equity
 
0.3

 
—

 
—

 
0.3

Insurance contracts
 
—

 
—

 
3.6

 
3.6

Total assets in fair value hierarchy
 
$
1.6

 
$
—

 
$
3.6

 
$
5.2

Common collective funds measured at net asset value
 
 
 
 
 
 
 
42.3

Total assets
 
 
 
 
 
 
 
$
47.5



(a)
Securities of diverse industries, substantially all investment grade.

Significant changes in Level 3 plan assets are as follows:
 
 
Year Ended December 31,
(in millions)
 
2019
 
2018
Insurance contracts:
 
 
 
 
Beginning of year
 
$
3.6

 
$
4.4

Payments
 
(0.4
)
 
(0.5
)
Actuarial loss
 
0.2

 
(0.1
)
Interest income
 
0.1

 
0.1

Cumulative translation adjustments
 
0.2

 
(0.3
)
End of year
 
$
3.7

 
$
3.6



Our insurance contracts classified as Level 3 are valued based on a discount rate determined by reference to the market interest rates prevailing on high quality debt instruments with cash flows that match the timing and amount of expected benefit payments under the pension plan in Canada, as well as a mortality assumption based upon the current mortality table, CPM2014 generational projected using mortality improvement scale CPM-B. As a result, the fair value of the insurance contract is equal to the defined benefit obligation in respect of the members covered under the insurance contract.

Money market investments are carried at amortized cost which approximates fair value due to the short-term maturity of these investments. Investments in equity securities are reported at fair value based on quoted market prices on national security exchanges. The fair value of investments in common collective funds are determined using the Net Asset Value (“NAV”) provided by the administrator of the fund. The NAV is determined by each fund’s trustee based upon the fair value of the underlying assets owned by the fund, less liabilities, divided by the number of outstanding units. The fair value of government related securities and corporate bonds is determined based on quoted market prices on national security exchanges, when available, or using valuation models which incorporate certain other observable inputs including recent trading activity for comparable securities and broker-quoted prices.

Future Benefit Payments
(in millions)
 
2020
 
2021
 
2022
 
2023
 
2024
 
2025-2029
Estimated future benefit payments for pension plans
 
1.9
 
2.0
 
2.1
 
2.2
 
2.4
 
14.0


We expect to contribute $4.1 million to our pension plans in 2020.

Multi-Employer Pension and Postretirement Benefit Plans

We contribute to multi-employer plans that provide pension and other postretirement benefits to certain employees under collective bargaining agreements. Contributions to these plans were $4.0 million in 2019, $3.8 million in 2018 and $3.3 million in 2017. Based on our contributions to each individual multi-employer plan relative to the total contributions of all participating employers in such plan, no multi-employer plan was deemed to be individually significant to us.

Defined Contribution Plans

Employer contributions for defined contribution plans sponsored by us were $5.9 million in 2019, $5.5 million in 2018 and $4.8 million in 2017.