Retirement Plans

3 Months Ended

Mar. 31, 2022

Retirement Plans [Abstract]

Retirement Plans

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(15) Retirement Plans:

Frontier recognizes actuarial gains (losses) for our pension and postretirement plans in the period they occur. The components of net periodic benefit cost other than the service cost component for our plans as well as any actuarial gains or losses are included in “Investment and other income (loss)” on the consolidated statement of income.

The following tables provide the components of total pension benefit cost:

	Successor		Predecessor
	Pension Benefits
	For the three months ended March 31,		For the three months ended March 31,
($ in millions)	2022		2021
Components of total pension benefit cost
Service cost	$	21	$	24
Interest cost on projected benefit obligation		24		23
Expected return on plan assets		(49)		(45)
Amortization of unrecognized loss		-		18
Total pension benefit cost	$	(4)	$	20
	Successor		Predecessor
	Postretirement Benefits
	For the three months ended March 31,		For the three months ended March 31,
($ in millions)	2022		2021
Components of net periodic postretirement benefit cost
Service cost	$	4	$	5
Interest cost on projected benefit obligation		6		7
Amortization of prior service cost (credit)		(3)		(7)
Amortization of unrecognized loss		-		3
Net periodic postretirement benefit cost	$	7	$	8

The components of net periodic benefit cost other than the service cost component are included in “Investment and other income” on the consolidated statement of income.

The value of our pension plan assets decreased $184 million from $2,655 million at December 31, 2021 to $2,471 million at March 31, 2022. This decrease primarily resulted from changes in the market value of investments of $183 million including plan expenses, benefit payments to participants of $33 million, partially offset by contributions of $32 million.

In the first quarter of 2022, Frontier amended the medical coverage for certain postretirement benefit plans, which necessitated a remeasurement of its other postretirement benefit (OPEB) obligations. This remeasurement resulted in the recognition of a net actuarial gain of $54 million, which was driven primarily from a higher assumed discount rate relative to December 31, 2021. Upon emergence from bankruptcy, Frontier revised its accounting policy to recognize actuarial gains and losses in the period in which they occur. As such, this gain was recorded in investment and other income, net on our consolidated statements of income.

During both the three months ended March 31, 2022 and 2021, we capitalized $6 million of pension and OPEB expense into the cost of our capital expenditures, as the costs relate to our engineering and plant construction activities.