XML 56 R40.htm IDEA: XBRL DOCUMENT v3.10.0.1
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS (Tables)
 12 Months Ended
Dec. 31, 2018
Retirement Benefits [Abstract]  
Schedule of Changes in Projected Benefit Obligations [Table Text Block]
Over the past 10 years, there have been various changes to our pension plan which have significantly reduced participant benefits under such plan. Further, on May 11, 2018, the Company communicated changes to the participants in its pension plan, that will "freeze" this plan going forward. Based on these changes, effective as of June 30, 2018, eligible participants will no longer receive pay credits and newly hired employees will not be eligible to participate in the pension plan. For the purposes of remeasurement, the Company used the date of April 30, 2018 as it was the month-end date that is closest to May 11, 2018. The impacts of these changes to the plan as of May 11, 2018, are presented in the table below (in millions):
 
Liability increase (decrease)
 
Accumulated other comprehensive income (loss)
 
Deferred tax asset decrease (increase)
 
Income included in Other- net
 
Income tax expense (increase) decrease
Plan change to projected benefit obligation
$
(1.6
)
 
$
1.3

 
$
0.3

 
$
—

 
$
—

Remeasurement gain
(29.9
)
 
23.6

 
6.3

 
—

 
—

Curtailment
—

 
(9.0
)
 
(1.0
)
 
11.4

 
(1.4
)
Total
$
(31.5
)
 
$
15.9

 
$
5.6

 
$
11.4

 
$
(1.4
)
The Company records unrealized gains and losses related to net periodic pension and other postretirement benefit cost net of estimated taxes in Accumulated other comprehensive income (loss).
On November 27, 2017, the Company purchased annuities to cover post-65 retiree medical benefits for current retirees as of the purchase date. The annuity purchase settled post-65 medical benefits (i.e., Health Reimbursement Account, or “HRA”, amounts) for affected participants, with the insurer taking responsibility for all benefit payments on and after January 1, 2019. The Company retained the obligation for 2018 benefit payments. The Company determined that this annuity purchase resulted in a full settlement of the post-65 medical obligation and as a result the entirety of the annuity purchase was treated as a settlement and resulted in a settlement loss of $5.8 million, calculated as of December 31, 2017.

On August 10, 2016, the Company communicated changes to the participants in its postretirement benefits plan, which was previously frozen to new entrants in 2008. Based on these changes, effective as of January 1, 2017, eligible participants now receive a health reimbursement account that provides a fixed dollar benefit per year. The impact of these changes to the plan and related, as of August 10, 2016, are presented in the table below (in millions):
 
Liability increase (decrease)
 
Accumulated other comprehensive income (loss)
 
Deferred tax liability increase (decrease)
Plan change benefit
$
(39.9
)
 
$
25.9

 
$
14.0

Remeasurement loss
5.2

 
(3.4
)
 
(1.8
)
Actuarial loss
5.2

 
(3.3
)
 
(1.9
)
Total
$
(29.5
)
 
$
19.2

 
$
10.3
Accumulated benefit obligations
The accumulated benefit obligations, which are presented below for all plans in the aggregate at December 31, are based on services rendered to date, but exclude the effect of future salary increases (in millions):
 
2018
 
2017
Accumulated benefit obligation
$
754.7

 
$
830.8
Changes in benefit obligations and plan assets, and funded status and weighted-average assumptions used to determine the benefit obligation
The following table presents the changes in benefit obligations and plan assets for the years ended December 31 and the funded status and weighted-average assumptions used to determine the benefit obligation at each year end (dollars in millions):
 
2018
 
2017
 
Pension benefits
 
Other benefits
 
Total
 
Pension benefits
 
Other benefits
 
Total
Projected benefit obligations:
 
 
 
 
 
 
 
 
 
 
 
Balance, January 1
$
835.8

 
$
18.0

 
$
853.8

 
$
772.1

 
$
29.9

 
$
802.0

Interest cost
27.9

 
0.5

 
28.4

 
25.5

 
0.9

 
26.4

Service cost
6.1

 
0.1

 
6.2

 
12.3

 
0.1

 
12.4

Actuarial (gain) loss
(51.4
)
 
(1.2
)
 
(52.6
)
 
78.0

 
5.5

 
83.5

Plan amendments
(0.5
)
 
—

 
(0.5
)
 
—

 
—

 
—

Plan settlements
—

 
—

 
—

 
—

 
(16.4
)
 
(16.4
)
Plan curtailments
(1.1
)
 
—

 
(1.1
)
 
—

 
—

 
—

Exchange rate changes
(0.4
)
 
—

 
(0.4
)
 
0.3

 
—

 
0.3

Benefits paid
(57.7
)
 
(1.4
)
 
(59.1
)
 
(52.4
)
 
(2.0
)
 
(54.4
)
Balance, December 31
758.7

 
16.0

 
774.7

 
835.8

 
18.0

 
853.8

 
 
 
 
 
 
 
 
 
 
 
 
Plan assets:
 

 
 

 
 

 
 

 
 

 
 

Fair value, January 1
609.7

 
—

 
609.7

 
544.6

 
—

 
544.6

Actual return
(40.5
)
 
—

 
(40.5
)
 
88.0

 
—

 
88.0

Employer contributions
24.2

 
—

 
24.2

 
29.3

 
—

 
29.3

Plan settlements
—

 
—

 
—

 
—

 
—

 
—

Exchange rate changes
(0.2
)
 
—

 
(0.2
)
 
0.2

 
—

 
0.2

Benefits paid
(57.7
)
 
—

 
(57.7
)
 
(52.4
)
 
—

 
(52.4
)
Fair value, December 31
535.5

 
—

 
535.5

 
609.7

 
—

 
609.7

Net benefit liabilities
$
(223.2
)
 
$
(16.0
)
 
$
(239.2
)
 
$
(226.1
)
 
$
(18.0
)
 
$
(244.1
)
 
 
 
 
 
 
 
 
 
 
 
 
Amounts recognized in Consolidated Balance Sheet:
 

 
 

 
 

 
 

 
 

 
 

Accrued liabilities
$
(15.1
)
 
$
(1.7
)
 
$
(16.8
)
 
$
(24.5
)
 
$
(2.5
)
 
$
(27.0
)
Other liabilities (long-term)
(208.1
)
 
(14.3
)
 
(222.4
)
 
(201.6
)
 
(15.5
)
 
(217.1
)
Net benefit liabilities
$
(223.2
)
 
$
(16.0
)
 
$
(239.2
)
 
$
(226.1
)
 
$
(18.0
)
 
$
(244.1
)
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated contributions in excess of (less than) net periodic benefit cost
$
141.7

 
$
(25.8
)
 
$
115.9

 
$
120.2

 
$
(39.1
)
 
$
81.1

 
 
 
 
 
 
 
 
 
 
 
 
Amounts not yet reflected in net periodic benefit cost:
 

 
 

 
 

 
 

 
 

 
 

Actuarial (loss) gain
(364.2
)
 
(4.3
)
 
(368.5
)
 
(358.1
)
 
(6.3
)
 
(364.4
)
Prior service credit
(0.7
)
 
14.1

 
13.4

 
11.8

 
27.4

 
39.2

Total accumulated other comprehensive income (loss)
(364.9
)
 
9.8

 
(355.1
)
 
(346.3
)
 
21.1

 
(325.2
)
Net benefit liabilities
$
(223.2
)
 
$
(16.0
)
 
$
(239.2
)
 
$
(226.1
)
 
$
(18.0
)
 
$
(244.1
)
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average assumptions:
 
 
 

 
 

 
 

 
 

 
 

Discount rate
4.35
%
 
4.23
%
 
 

 
3.68
%
 
3.52
%
 
 

Rate of compensation increase
3.78
%
 
 

 
 

 
4.28
%
 
 

 
 
Amounts amortized from accumulated other comprehensive to net periodic benefits cost
The Company estimates the following amounts, which are classified in accumulated other comprehensive loss, a component of shareholders’ equity, will be recognized as net periodic benefit cost in 2019 (in millions):
 
Pension benefits
 
Other retirement benefits
 
Total
Actuarial (loss) gain
$
(9.0
)
 
$
(0.6
)
 
$
(9.6
)
Prior service credit
—

 
12.4

 
12.4

Total amortization
$
(9.0
)
 
$
11.8

 
$
2.8
Components of net periodic pension cost and weighted-average assumptions used to determine net cost
The components of net periodic pension cost and the weighted-average assumptions used to determine net cost were as follows (dollars in millions):
 
2018
 
2017
 
2016
Service cost (1)
$
6.1

 
$
12.3

 
$
16.3

Interest cost (2)
27.9

 
25.5

 
26.3

Expected return on plan assets (2)
(36.5
)
 
(37.7
)
 
(39.6
)
Recognized actuarial loss (2)
18.5

 
23.3

 
21.0

Amortization of prior service credit (2)
(1.7
)
 
(5.1
)
 
(5.0
)
Curtailment gain recognized (2)
(11.4
)
 
—

 
(0.4
)
Settlement loss recognized (2)
—

 
—

 
0.5

Net periodic pension cost
$
2.9

 
$
18.3

 
$
19.1

 
 
 
 
 
 
Discount rate
3.69
%
 
4.29
%
 
4.53
%
Expected return on plan assets
6.68
%
 
7.13
%
 
7.28
%
Rate of compensation increase
4.28
%
 
4.14
%
 
4.14
%
 
 
 
 
 
 
(1) Included in Direct operating costs and Selling, general and administrative on the Consolidated Statements of Operations
(2) Included in Other - net on the Consolidated Statements of Operations
The components of net periodic cost of other postretirement benefits and the weighted average discount rate used to determine net cost were as follows (dollars in millions):
 
2018
 
2017
 
2016
Service cost (1)
$
0.1

 
$
0.1

 
$
0.3

Interest cost (2)
0.5

 
0.9

 
1.6

Amortization of prior service credit (2)
(13.3
)
 
(13.3
)
 
(6.4
)
Amortization of net (gain) loss (2)
0.8

 
0.7

 
0.3

Settlement loss (2)
—

 
5.8

 
0.1

Net periodic cost of other postretirement benefits
$
(11.9
)
 
$
(5.8
)
 
$
(4.1
)
 
 
 
 
 
 
Discount rate
3.50
%
 
3.91
%
 
4.18
%
 
 
 
 
 
 
(1) Included in Direct operating costs and Selling, general and administrative on the Consolidated Statements of Operations
(2) Included in Other - net on the Consolidated Statements of Operations
Target allocations among asset categories and fair values of each category of plan assets, classified by level within fair value hierarchy
Target allocations among asset categories and the fair values of each category of plan assets as of December 31, 2018 and 2017, classified by level within the US GAAP fair value hierarchy are presented below. The plans will periodically reallocate assets in accordance with the allocation targets, after giving consideration to the expected level of cash required to pay current benefits and plan expenses (dollars in millions):
 
Target range
 
Total
 
Quoted prices in active markets for identical assets (Level 1)
 
Significant observable inputs (Level 2)
 
Significant unobservable inputs (Level 3)
December 31, 2018:
 
 
 
 
 
 
 
 
 
Equities:
53% to 69%
 
 
 
 
 
 
 
 
U.S. large cap
22% to 28%
 
$
131.6

 
$
—

 
$
131.6

 
$
—

U.S. small cap
4% to 10%
 
35.6

 
—

 
35.6

 
—

International all cap
21% to 29%
 
129.9

 
—

 
129.9

 
—

International small cap
2% to 8%
 
28.8

 
—

 
28.8

 
—

Real estate equities
0% to 13%
 
51.7

 
—

 
51.7

 
—

Fixed income:
25% to 35%
 
 
 
 

 
 

 
 

Cash and equivalents
0% to 10%
 
4.1

 
—

 
4.1

 
—

Aggregate
9% to 19%
 
73.9

 
—

 
73.9

 
—

Core plus
9% to 19%
 
74.7

 
74.7

 
—

 
—

Group annuity contracts
 
 
5.2

 
—

 
5.2

 
—

Total
 
 
$
535.5

 
$
74.7

 
$
460.8

 
$
—

 
 
 
 
 
 
 
 
 
 
December 31, 2017:
 
 
 

 
 

 
 

 
 

Equities:
53% to 69%
 
 

 
 

 
 

 
 

U.S. large cap
22% to 28%
 
$
158.2

 
$
—

 
$
158.2

 
$
—

U.S. small cap
4% to 10%
 
45.3

 
—

 
45.3

 
—

International all cap
21% to 29%
 
156.2

 
—

 
156.2

 
—

International small cap
2% to 8%
 
36.3

 
—

 
36.3

 
—

Real estate equities
0% to 13%
 
50.6

 
—

 
50.6

 
—

Fixed income:
25% to 35%
 
 
 
 

 
 

 
 

Cash and equivalents
0% to 10%
 
6.2

 
—

 
6.2

 
—

Aggregate
9% to 19%
 
74.9

 
—

 
74.9

 
—

Core plus
9% to 19%
 
78.1

 
78.1

 
—

 
—

Group annuity contracts
 
 
3.9

 
—

 
3.9

 
—

Total
 
 
$
609.7

 
$
78.1

 
$
531.6

 
$
—
Estimated future annual payments for pension and other postretirement benefits
Estimated future annual benefit payments from plan assets are presented below. Such amounts are based on existing benefit formulas and include the effect of future service (in millions):
 
Pension benefits
 
Other postretirement benefits
Year ended December 31,
 
 
 
2019
$
48.5

 
$
1.7

2020
49.7

 
1.6

2021
50.5

 
1.4

2022
51.0

 
1.4

2023
51.3

 
1.3

2024 through 2028
256.4

 
5.9