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Retirement Plans
12 Months Ended
Dec. 31, 2016
Retirement Plans [Abstract]  
Retirement Plans
7. Retirement Plans

The Company provides benefits under defined contribution plans including a savings plan and an employee stock ownership plan (“ESOP”). The savings plan covers substantially all domestic salaried and certain non-union hourly employees and provides for matching contributions up to 4% of each employee’s salary. The ESOP covers substantially all domestic employees and provides for contributions based on a percentage of each employee’s compensation as determined by the Company’s Board of Directors. Total expense for the Company’s defined contribution plans was $6.7 million in 2016, $5.4 million in 2015, and $5.0 million in 2014.

Although the Company intends for these defined contribution plans to be the primary retirement benefit for most employees, the Company also has several defined benefit plans. The funded status of the defined benefit plans was as follows at December 31:

(in thousands)
 
2016
  
2015
 
Benefit obligation at beginning of year
 
$
46,359
  
$
55,396
 
Service cost
  
2,091
   
2,692
 
Interest cost
  
1,669
   
1,803
 
Foreign currency exchange rate changes
  
(2,306
)
  
(2,379
)
Benefits paid
  
(8,280
)
  
(10,708
)
Actuarial loss (gain)
  
1,906
   
(1,173
)
Curtailment gain
  
-
   
(121
)
Other
  
252
   
849
 
Benefit obligation at end of year
  
41,691
   
46,359
 
Plan assets at beginning of year
  
36,236
   
39,520
 
Company contributions
  
6,947
   
10,204
 
Foreign currency exchange rate changes
  
(3,714
)
  
(2,859
)
Benefits paid
  
(8,280
)
  
(10,708
)
Actual gain on plan assets
  
4,952
   
79
 
Plan assets at end of year
  
36,141
   
36,236
 
Funded status
 
$
(5,550
)
 
$
(10,123
)
Accumulated benefit obligation
 
$
40,743
  
$
45,217
 
 
Amounts recognized in the Consolidated Balance Sheets at December 31:

(in thousands)
 
2016
  
2015
 
Accrued employee and retiree benefits
 
$
(14,510
)
 
$
(14,129
)
Other accrued expenses
  
(765
)
  
(5,927
)
Other assets
  
9,725
   
9,933
 
Net liability
 
$
(5,550
)
 
$
(10,123
)

Components of annual benefit cost:

(In thousands)
 
2016
  
2015
  
2014
 
          
Service cost
 
$
2,091
  
$
2,692
  
$
2,523
 
Interest cost
  
1,669
   
1,803
   
2,390
 
Expected return on plan assets
  
(1,141
)
  
(1,210
)
  
(1,791
)
Amortization of prior service cost
  
-
   
-
   
171
 
Recognized actuarial loss (gain)
  
193
   
228
   
(305
)
Settlement expense
  
543
   
1,119
   
1,467
 
Curtailment gain
  
-
   
(104
)
  
(754
)
Defined benefit expense
 
$
3,355
  
$
4,528
  
$
3,701
 

Weighted average liability assumptions as of December 31:

  
2016
  
2015
 
Discount rate
  
3.48
%
  
3.94
%
Expected return on plan assets
  
2.85
%
  
3.40
%
Rate of compensation increase
  
0.43
%
  
0.35
%

Weighted average cost assumptions for the year ended December 31:

  
2016
  
2015
 
Discount rate
  
3.94
%
  
3.70
%
Expected return on plan assets
  
3.40
%
  
3.32
%
Rate of compensation increase
  
0.35
%
  
0.37
%

The aggregate amounts of benefits expected to be paid from defined benefit plans in each of the next five years subsequent to December 31, 2016, which include employees’ expected future service, are as follows: 2017, $2.2 million; 2018, $3.3 million; 2019, $2.2 million; 2020, $1.7 million; 2021, $2.4 million and $18.4 million in total for the years 2022 through 2026.

The Company expects to contribute $1.0 million to defined benefit plans in 2017.

Amounts in accumulated other comprehensive income at December 31 were as follows:

(In thousands)
 
 
2016
 
 
 
2015
 
Unrecognized net actuarial loss
 
$
3,384
  
$
5,725
 

The pension adjustments, net of tax, recognized in OCI, were as follows:

(In thousands)
 
2016
  
2015
  
2014
 
          
Net actuarial gain (loss) arising during the period
 
$
1,312
  
$
(140
)
 
$
(387
)
Amortization of actuarial loss, included in defined benefit expense
  
544
   
917
   
1,252
 
Amortization of prior service cost, included in defined benefit expense
  
-
   
-
   
733
 
Pension adjustment, net of tax
 
$
1,856
  
$
777
  
$
1,598
 

The estimated actuarial loss for the defined benefit plans that will be amortized from accumulated other comprehensive loss into periodic benefit cost during 2017 is $0.1 million.
 
The investment objectives and target allocations for the Company’s pension plans related to the assets of the plans are reviewed on a regular basis. The investment objectives for the pension assets are to maximize the return on assets while maintaining an overall level of risk appropriate for a retirement fund and ensuring the availability of funds for the payment of retirement benefits. The levels of risk assumed by the pension plans are determined by market conditions, the rate of return expectations and the liquidity requirements of each pension plan. The actual asset allocations of each pension plan are reviewed on a regular basis to ensure that they are in line with the target allocations.

The following table presents the Company’s pension plan assets by asset category as of December 31, 2016 and 2015:

 
Fair Value
as of
December 31,
 
Fair Value Measurements at
December 31, 2016
Using Fair Value Hierarchy
 
Fair Value
as of
December 31, 
 
Fair Value Measurements at
December 31, 2015
Using Fair Value Hierarchy
 
(in thousands)
2016
 
Level 1
  
Level 2
Level 3
 
 
2015
 
Level 1
 
Level 2
 
Level 3
 
Equity Funds
                
Domestic
 
$
5,830
  
$
5,830
  
$
  
$
  
$
6,064
  
$
6,064
  
$
  
$
 
International
  
254
   
106
   
148
   
   
179
   
3
   
176
   
 
International Fixed Income Funds
  
23,156
   
851
   
22,305
   
   
22,374
   
711
   
21,663
   
 
Other investments
  
6,901
   
45
   
6,856
   
   
7,619
   
40
   
7,579
   
 
Total assets at fair value
 
$
36,141
  
$
6,832
  
$
29,309
  
$
  
$
36,236
  
$
6,818
  
$
29,418
  
$
 

The Company is required to categorize pension plan assets based on the following fair value hierarchy:
 
Level 1:
Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2:
Inputs other than quoted prices included in Level 1 that are observable for the asset or liability through corroboration with observable market data.
Level 3:
Unobservable inputs that reflect the reporting entity’s own assumptions.