Pension And Other Retiree Benefits

12 Months Ended

Dec. 31, 2011

Pension And Other Retiree Benefits [Abstract]

Pension And Other Retiree Benefits

4. Pension and Other Retiree Benefits

The Company has a number of pension plans, principally in the U.K. and the U.S. The plans provide for payment of retirement benefits, mainly commencing between the ages of 60 and 65, and also for payment of certain disability and severance benefits. After meeting certain qualifications, an employee acquires a vested right to future benefits. The benefits payable under the plans are generally determined on the basis of an employee's length of service and earnings. Cash contributions to the plans are made as necessary to ensure legal funding requirements are satisfied.

The Company provides postretirement health care and life insurance benefits to certain employees and retirees in the U.S. and certain employee groups outside of the U.S. These benefit plans have been frozen to new participants. Many employees and retirees outside of the U.S. are covered by government health care programs.

On January 20, 2009, the Company's Board of Directors approved plan amendments to temporarily freeze the Company's U.S. pension and non-qualified supplemental retirement plans effective March 7, 2009. No additional benefits will accrue under these plans after that date until further action by the Board of Directors. As a result, the Company recognized a curtailment gain of $1.0 million in operating income during 2009.

The following table sets forth the Company's defined benefit pension plans and other postretirement benefit plans funded status and the amounts recognized in the Company's consolidated balance sheets:

	Pension Benefits												Postretirement
	U.S.						International
(in millions of dollars)	2011			2010			2011			2010			2011			2010
Change in projected benefit obligation (PBO)
Projected benefit obligation at beginning of year	$	162.5		$	154.4		$	268.3		$	271.1		$	13.3		$	13.4
Service cost		—			—			2.1			2.3			0.2			0.2
Interest cost		8.6			8.9			14.7			14.6			0.6			0.7
Actuarial loss		9.5			7.5			14.2			5.1			—			—
Participants' contributions		—			—			0.9			1.0			0.2			0.2
Benefits paid		(8.7	)		(8.3	)		(13.0	)		(11.2	)		(0.9	)		(1.0	)
Curtailment gain		—			—			(0.6	)		—			—			—
Foreign exchange rate changes		—			—			(2.0	)		(12.0	)		—			(0.2	)
Other items		—			—			—			(2.6	)		—			—
Projected benefit obligation at end of year		171.9			162.5			284.6			268.3			13.4			13.3
Change in plan assets
Fair value of plan assets at beginning of year		124.8			107.9			242.3			234.5			—			—
Actual return on plan assets		(3.2	)		18.0			7.0			24.3			—			—
Employer contributions		6.2			7.2			6.6			6.5			0.7			0.8
Participants' contributions		—			—			0.9			1.0			0.2			0.2
Benefits paid		(8.7	)		(8.3	)		(13.0	)		(11.2	)		(0.9	)		(1.0	)
Foreign exchange rate changes		—			—			(1.1	)		(10.2	)		—			—
Other		—			—			—			(2.6	)		—			—
Fair value of plan assets at end of year		119.1			124.8			242.7			242.3			—			—
Funded status (Fair value of plan assets less PBO)	$	(52.8	)	$	(37.7	)	$	(41.9	)	$	(26.0	)	$	(13.4	)	$	(13.3	)
Amounts recognized in the consolidated balance sheet consist of:
Other current liabilities	$	0.2		$	0.2		$	0.6		$	0.6		$	1.2		$	1.3
Accrued benefit liability (1)		52.6			37.5			41.3			25.4			12.2			12.0
Components of accumulated other comprehensive income, net of tax:
Unrecognized prior service cost (benefit)		—			—			0.4			0.5			—			(0.1	)
Unrecognized actuarial (gain) loss		56.1			36.9			62.2			48.4			(2.6	)		(3.2	)

(1) Pension and post-retirement liabilities of $106.1 million as of December 31, 2011, increased from $74.9 million as of December 31, 2010, due to both lower discount rates compared to prior year assumptions and underperformance of the assets of the pension plans compared to the expected long-term rate of return of the assets of the pension plans.

All plans have projected benefit obligations in excess of plan assets.

Of the amounts included within accumulated other comprehensive income, the Company expects to recognize the following pre-tax amounts as components of net periodic benefit cost during 2012:

	Pension Benefits				Postretirement
(in millions of dollars)	U.S.		International
Prior service cost	$	—	$	0.2	$	—
Actuarial (gain) loss		6.2		5.4		(0.5	)
	$	6.2	$	5.6	$	(0.5	)

The accumulated benefit obligation for all defined benefit pension plans was $443.6 million and $428.8 million at December 31, 2011 and 2010, respectively.

The following table sets out information for pension plans with an accumulated benefit obligation in excess of plan assets:

	U.S.				International
(in millions of dollars)	2011		2010		2011		2010
Projected benefit obligation	$	171.9	$	162.5	$	272.8	$	62.1
Accumulated benefit obligation		171.9		162.5		260.2		60.3
Fair value of plan assets		119.1		124.8		230.9		46.0

The following table sets out the components of net periodic benefit cost:

	Pension Benefits																		Postretirement
	U.S.									International
(in millions of dollars)	2011			2010			2009			2011			2010			2009			2011			2010			2009
Service cost	$	—		$	—		$	1.3		$	2.1		$	2.3		$	2.4		$	0.2		$	0.2		$	0.1
Interest cost		8.6			8.9			9.1			14.7			14.6			13.7			0.6			0.7			0.8
Expected return on plan assets		(10.7	)		(10.4	)		(10.7	)		(16.0	)		(15.1	)		(12.8	)		—			—			—
Amortization of prior service cost		—			—			—			0.2			0.1			0.2			—			—			—
Amortization of net loss (gain)		4.3			3.0			1.2			3.9			4.8			3.4			(0.6	)		(0.9	)		(0.9	)
Curtailment		—			—			(1.0	)		(0.2	)		—			(0.5	)		—			—			—
Net periodic benefit cost	$	2.2		$	1.5		$	(0.1	)	$	4.7		$	6.7		$	6.4		$	0.2		$	—		$	—

Other changes in plan assets and benefit obligations that were recognized in other comprehensive income during the years ended December 31, 2011, 2010 and 2009, respectively, were as follows:

	Pension Benefits																		Postretirement
	U.S.									International
(in millions of dollars)	2011			2010			2009			2011			2010			2009			2011		2010		2009
Current year actuarial (gain)/loss	$	23.5		$	(0.2	)	$	(16.1	)	$	22.8		$	(4.2	)	$	26.1		$	—	$	—	$	(0.3	)
Amortization of actuarial gain (loss)		(4.3	)		(3.0	)		(1.2	)		(3.9	)		(4.8	)		(3.6	)		0.6		0.9		1.0
Amortization of prior service cost		—			—			—			(0.2	)		(0.1	)		(0.3	)		—		—		—
Curtailment gain		—			—			0.2			—			—			—			—		—		—
Exchange rate adjustment		—			—			—			(1.0	)		(3.2	)		5.8			—		0.1		(0.4	)
Total recognized in other comprehensive income	$	19.2		$	(3.2	)	$	(17.1	)	$	17.7		$	(12.3	)	$	28.0		$	0.6	$	1.0	$	0.3
Total recognized in net periodic benefit cost and other comprehensive income	$	21.4		$	(1.7	)	$	(17.2	)	$	22.4		$	(5.6	)	$	34.4		$	0.8	$	1.0	$	0.3

Assumptions

Weighted average assumptions used to determine benefit obligations for years ended December 31, 2011, 2010 and 2009 were:

	Pension Benefits																		Postretirement
	U.S.									International
	2011			2010			2009			2011			2010			2009			2011			2010			2009
Discount rate		5.0	%		5.5	%		5.9	%		4.7	%		5.4	%		5.8	%		4.5	%		5.0	%		5.9	%
Rate of compensation increase		N/A			N/A			N/A			3.6	%		4.4	%		4.5	%		—			—			—

Weighted average assumptions used to determine net cost for years ended December 31, 2011, 2010 and 2009 were:

	Pension Benefits																		Postretirement
	U.S.									International
	2011			2010			2009			2011			2010			2009			2011			2010			2009
Discount rate		5.5	%		5.9	%		6.5	%		5.4	%		5.8	%		6.5	%		5.0	%		5.9	%		6.5	%
Expected long-term rate of return		8.2	%		8.2	%		8.2	%		6.4	%		6.8	%		6.3	%		—			—			—
Rate of compensation increase		N/A			N/A			4.0	%		4.4	%		4.5	%		3.6	%		—			—			—

Weighted average health care cost trend rates used to determine postretirement benefit obligations and net cost at December 31, 2011, 2010 and 2009 were:

	Postretirement Benefits
	2011			2010			2009
Health care cost trend rate assumed for next year		7	%		8	%		7	%
Rate that the cost trend rate is assumed to decline (the ultimate trend rate)		5	%		5	%		5	%
Year that the rate reaches the ultimate trend rate		2020			2020			2020

Assumed health care cost trend rates may have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects:

(in millions of dollars)	1-Percentage- Point  Increase		1-Percentage- Point  Decrease
Effect on total of service and interest cost	$	0.2	$	(0.2	)
Effect on postretirement benefit obligation		1.3		(1.1	)

Plan Assets

The investment strategy for the Company is to optimize investment returns through a diversified portfolio of investments, taking into consideration underlying plan liabilities and asset volatility. Each plan has a different target asset allocation, which is reviewed periodically and is based on the underlying liability structure. The target asset allocation for our U.S. plan is 65% in equity securities, 20% in fixed income securities and 15% in alternate assets. The target asset allocation for non-U.S. plans is set by the local plan trustees.

The Company's pension plan weighted average asset allocations at December 31, 2011 and 2010 were as follows:

	2011						2010
	U.S.			International			U.S.			International
Asset category
Equity securities		63	%		48	%		68	%		48	%
Fixed income		32			42			32			42
Real estate		—			4			—			4
Other (1)		5			6			—			6
Total		100	%		100	%		100	%		100	%

(1) Insurance contracts, multi-strategy hedge funds and cash and cash equivalents for certain of our plans.

U.S. Pension Plan Assets

Fair value measurements of our U.S. pension plan assets by asset category at December 31, 2011 are as follows:

(in millions of dollars)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Value as of December 31, 2011
Common stocks	$	6.9	$	—	$	—	$	6.9
Mutual funds		68.3		—		—		68.3
Government debt securities		—		10.9		—		10.9
Corporate debt securities		—		8.0		—		8.0
Asset-backed securities		—		7.8		—		7.8
Multi-strategy hedge funds		—		5.4		—		5.4
Government mortgage-backed securities		—		4.0		—		4.0
Common collective trust funds, collateralized mortgage obligations, mortgage backed securities, and other fixed income securities		—		7.8		—		7.8
Total	$	75.2	$	43.9	$	—	$	119.1

Fair value measurements of our U.S. pension plan assets by asset category at December 31, 2010 are as follows:

(in millions of dollars)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Value as of December 31, 2010
Common stocks	$	6.4	$	—	$	—	$	6.4
Mutual funds		78.5		—		—		78.5
Common collective trust funds		—		11.5		—		11.5
Government debt securities		—		7.5		—		7.5
Corporate debt securities		—		7.4		—		7.4
Collateralized mortgage obligations		—		5.0		—		5.0
Asset-backed securities, mortgage backed securities, and other fixed income securities		—		8.5		—		8.5
Total	$	84.9	$	39.9	$	—	$	124.8

Mutual funds and common stocks: The fair values of mutual fund and common stock fund investments are determined by obtaining quoted prices on nationally recognized securities exchanges (level 1 inputs).

Debt securities: Fixed income securities, such as corporate and government bonds, collateralized mortgage obligations, asset-backed securities, and other debt securities are valued using quotes from independent pricing vendors based on recent trading activity and other relevant information, including market interest rate curves, referenced credit spreads, and estimated prepayment rates, where applicable (level 2 inputs).

Multi-strategy hedge funds: The fair values of participation units held in multi-strategy hedge funds are based on their net asset values, as reported by the managers of the funds and are based on the daily closing prices of the underlying investments (level 2 inputs).

Common collective trusts: The fair values of participation units held in common collective trusts are based on their net asset values, as reported by the managers of the common collective trusts and as supported by the unit prices of actual purchase and sale transactions occurring as of or close to the financial statement date (level 2 inputs).

International Pension Plans Assets

Fair value measurements of our international pension plans assets by asset category at December 31, 2011 are as follows:

(in millions of dollars)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Value as of December 31, 2011
Cash and cash equivalents	$	3.2	$	—	$	—	$	3.2
Equity securities		116.6		—		—		116.6
Government debt securities		—		9.0		—		9.0
Corporate debt securities		—		82.6		—		82.6
Other debt securities		—		9.7		—		9.7
Real estate		—		10.0		—		10.0
Insurance contracts		—		9.7		—		9.7
Multi-strategy hedge funds		—		1.9		—		1.9
Total	$	119.8	$	122.9	$	—	$	242.7

Fair value measurements of our international pension plans assets by asset category at December 31, 2010 are as follows:

(in millions of dollars)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Fair Value as of December 31, 2010
Cash and cash equivalents	$	4.8	$	—	$	—	$	4.8
Equity securities		116.8		—		—		116.8
Government debt securities		—		19.0		—		19.0
Corporate debt securities		—		74.5		—		74.5
Other debt securities		—		8.7		—		8.7
Real estate		—		9.7		—		9.7
Insurance contracts		—		8.8		—		8.8
Total	$	121.6	$	120.7	$	—	$	242.3

Equity securities: The fair values of equity securities are determined by obtaining quoted prices on nationally recognized securities exchanges (level 1 inputs).

Debt securities: Fixed income securities, such as corporate and government bonds and other debt securities consisting of index linked securities. These debt securities are valued using quotes from independent pricing vendors based on recent trading activity and other relevant information, including market interest rate curves, referenced credit spreads, and estimated prepayment rates, where applicable (level 2 inputs).

Real estate: Real estate consists of managed real estate investment trust securities (level 2 inputs).

Insurance contracts: Valued at contributions made, plus earnings, less participant withdrawals and administrative expenses, which approximate fair value (level 2 inputs).

Multi-strategy hedge funds: The fair values of participation units held in multi-strategy hedge funds are based on their net asset values, as reported by the managers of the funds and are based on the daily closing prices of the underlying investments (level 2 inputs).

Cash Contributions

The Company expects to contribute $16.3 million to its pension plans in 2012.

The Company sponsors a number of defined contribution plans. Contributions are determined under various formulas. Costs related to such plans amounted to $6.6 million, $6.1 million and $3.6 million in 2011, 2010 and 2009, respectively. In January 2009, the Company's Board of Directors approved amendments to the Company's U.S. 401(k) plan to suspend employer matching contributions for all participants effective February 21, 2009. The Company reinstated its employer matching contributions for all 401(k) plan participants in October, 2009. This action resulted in pre-tax savings of approximately $3.2 million during 2009.

The following table presents estimated future benefit payments for the next ten fiscal years:

(in millions of dollars)	Pension Benefits		Postretirement Benefits
2012	$	20.3	$	1.2
2013	$	20.9	$	1.3
2014	$	21.5	$	1.2
2015	$	22.1	$	1.1
2016	$	23.1	$	1.1
Years 2017—2021	$	127.9	$	4.6