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Retirement Plans | 12 Months Ended
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Dec. 31, 2018
Retirement Benefits [Abstract] |
Retirement Plans | 16 Retirement Plans U.S. employees are eligible to participate in the Waters Employee Investment Plan, a 401(k) defined contribution plan, immediately upon hire. Employees may contribute up to 60% of eligible pay on a pre-tax or post-tax basis and the Company makes matching contributions of 100% for contributions up to 6% of eligible pay. The Company also sponsors a 401(k) Restoration Plan, which is a nonqualified defined contribution plan. Employees are 100% vested in employee and Company matching contributions for both plans. For the years ended December 31, 2018, 2017 and 2016, the Company’s matching contributions amounted to $17 million, $16 million and $15 million, respectively. The Company adopted new accounting guidance which requires that an employer disaggregate the service cost component from other components of net benefit cost. As a result of the adoption of this standard, the components of net periodic benefit cost other than the service cost component are included in other income in the consolidated statements of operations and all previous periods have been adjusted accordingly. In May 2018, the Company’s board of directors approved the termination of two defined benefit pension plans in the U.S. for which the pay credit accruals have been frozen, the Waters Retirement Plan and the Waters Retirement Restoration Plan (collectively, the “U.S. Pension Plans”). In December 2018, the Company settled the Waters Retirement Plan obligation by making lump-sum cash payments and purchasing annuity contracts for participants to permanently extinguish the pension plan’s obligations. As a result, the Company recorded a $46 million charge to other expense, which consisted of a $6 million cash contribution to the plan and a $40 million non-cash charge related to the reversal of unrecognized actuarial losses recorded in accumulated other comprehensive income in the stockholders’ equity. The $46 million pre-tax charge reduced net income per diluted share by $0.39. The termination of the Waters Retirement Restoration Plan is expected to be completed in 2019. The Company also sponsors other employee benefit plans in the U.S., including a retiree healthcare plan, which provides reimbursement for medical expenses and is contributory. There are various employee benefit plans outside the United States (both defined benefit and defined contribution plans). Certain non-U.S. defined benefit plans (“Non-U.S. Pension Plans”) are included in the disclosures below, which are required under the accounting standards for retirement benefits. The Company contributed $13 million, $12 million and $12 million in the years ended December 31, 2018, 2017 and 2016, respectively, to the non-U.S. plans (primarily defined contribution plans) which are currently outside of the scope of the required disclosures. The eligibility and vesting of non-U.S. plans are consistent with local laws and regulations. The net periodic pension cost is made up of several components that reflect different aspects of the Company’s financial arrangements as well as the cost of benefits earned by employees. These components are determined using the projected unit credit actuarial cost method and are based on certain actuarial assumptions. The Company’s accounting policy is to reflect in the projected benefit obligation all benefit changes to which the Company is committed as of the current valuation date; use a market-related value of assets to determine pension expense; amortize increases in prior service costs on a straight-line basis over the expected future service of active participants as of the date such costs are first recognized; and amortize cumulative actuarial gains and losses in excess of 10% of the larger of the market-related value of plan assets and the projected benefit obligation over the expected future service of active participants. Summary data for the U.S. Pension Plans, U.S. Retiree Healthcare Plan and Non-U.S. Pension Plans are presented in the following tables, using the measurement dates of December 31, 2018 and 2017, respectively. The reconciliation of the projected benefit obligations for the plans at December 31, 2018 and 2017 is as follows (in thousands):
|  | 2018 |  |  | 2017 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Projected benefit obligation, January 1 |  | $ | 168,064 |  |  | $ | 17,121 |  |  | $ | 96,378 |  |  | $ | 159,416 |  |  | $ | 14,921 |  |  | $ | 85,311 |
Service cost |  |  | 568 |  |  |  | 566 |  |  |  | 5,368 |  |  |  | 450 |  |  |  | 546 |  |  |  | 5,082 |
Employee contributions |  |  | — |  |  |  | 1,159 |  |  |  | 622 |  |  |  | — |  |  |  | 1,041 |  |  |  | 605 |
Interest cost |  |  | 6,491 |  |  |  | 636 |  |  |  | 1,707 |  |  |  | 6,829 |  |  |  | 618 |  |  |  | 1,518 |
Actuarial losses (gains) |  |  | 6,415 |  |  |  | (621 | ) |  |  | (2,274 | ) |  |  | 8,658 |  |  |  | 942 |  |  |  | (2,590 | )
Benefits paid |  |  | (3,416 | ) |  |  | (1,007 | ) |  |  | (3,277 | ) |  |  | (5,058 | ) |  |  | (947 | ) |  |  | (2,078 | )
Plan amendments |  |  | — |  |  |  | (130 | ) |  |  | (44 | ) |  |  | — |  |  |  | — |  |  |  | 636 |
Plan settlements |  |  | (177,150 | ) |  |  | — |  |  |  | (2,791 | ) |  |  | (2,231 | ) |  |  | — |  |  |  | (1,229 | )
Other plans |  |  | — |  |  |  | — |  |  |  | 1,063 |  |  |  | — |  |  |  | — |  |  |  | 196 |
Currency impact |  |  | — |  |  |  | — |  |  |  | (3,030 | ) |  |  | — |  |  |  | — |  |  |  | 8,927 |
Projected benefit obligation, December 31 |  | $ | 972 |  |  | $ | 17,724 |  |  | $ | 93,722 |  |  | $ | 168,064 |  |  | $ | 17,121 |  |  | $ | 96,378 |
The accumulated benefit obligations for the plans at December 31, 2018 and 2017 are as follows (in thousands):
|  | 2018 |  |  | 2017 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Accumulated benefit obligation |  | $ | 972 |  |  |  | * | * |  | $ | 82,026 |  |  | $ | 168,064 |  |  |  | * | * |  | $ | 82,615 |
** Not applicable. The reconciliation of the fair value of the plan assets at December 31, 2018 and 2017 is as follows (in thousands):
|  | 2018 |  |  | 2017 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Fair value of plan assets, January 1 |  | $ | 171,373 |  |  | $ | 11,125 |  |  | $ | 74,990 |  |  | $ | 144,665 |  |  | $ | 9,142 |  |  | $ | 65,548 |
Actual return on plan assets |  |  | 2,555 |  |  |  | (584 | ) |  |  | 1,070 |  |  |  | 27,729 |  |  |  | 1,542 |  |  |  | 390 |
Company contributions |  |  | 6,625 |  |  |  | 387 |  |  |  | 10,778 |  |  |  | 6,162 |  |  |  | 347 |  |  |  | 4,733 |
Employee contributions |  |  | — |  |  |  | 1,159 |  |  |  | 622 |  |  |  | — |  |  |  | 1,041 |  |  |  | 605 |
Plan settlements |  |  | (177,137 | ) |  |  | — |  |  |  | — |  |  |  | (2,125 | ) |  |  | — |  |  |  | (915 | )
Benefits paid |  |  | (3,416 | ) |  |  | (1,007 | ) |  |  | (3,277 | ) |  |  | (5,058 | ) |  |  | (947 | ) |  |  | (2,078 | )
Other plans |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (213 | )
Currency impact |  |  | — |  |  |  | — |  |  |  | (2,596 | ) |  |  | — |  |  |  | — |  |  |  | 6,920 |
Fair value of plan assets, December 31 |  | $ | — |  |  | $ | 11,080 |  |  | $ | 81,587 |  |  | $ | 171,373 |  |  | $ | 11,125 |  |  | $ | 74,990 |
The summary of the funded status for the plans at December 31, 2018 and 2017 is as follows (in thousands):
|  | 2018 |  |  | 2017 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Projected benefit obligation |  | $ | (972 | ) |  | $ | (17,724 | ) |  | $ | (93,722 | ) |  | $ | (168,064 | ) |  | $ | (17,121 | ) |  | $ | (96,378 | )
Fair value of plan assets |  |  | — |  |  |  | 11,080 |  |  |  | 81,587 |  |  |  | 171,373 |  |  |  | 11,125 |  |  |  | 74,990 |
Funded status |  | $ | (972 | ) |  | $ | (6,644 | ) |  | $ | (12,135 | ) |  | $ | 3,309 |  |  | $ | (5,996 | ) |  | $ | (21,388 | )
The summary of the amounts recognized in the consolidated balance sheets for the plans at December 31, 2018 and 2017 is as follows (in thousands):
|  | 2018 |  |  | 2017 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Long-term assets |  | $ | — |  |  | $ | — |  |  | $ | 3,284 |  |  | $ | 4,562 |  |  | $ | — |  |  | $ | 1,245 |
Current liabilities |  |  | (972 | ) |  |  | (387 | ) |  |  | (1 | ) |  |  | (76 | ) |  |  | (347 | ) |  |  | — |
Long-term liabilities |  |  | — |  |  |  | (6,257 | ) |  |  | (15,418 | ) |  |  | (1,177 | ) |  |  | (5,649 | ) |  |  | (22,633 | )
Net amount recognized at December 31 |  | $ | (972 | ) |  | $ | (6,644 | ) |  | $ | (12,135 | ) |  | $ | 3,309 |  |  | $ | (5,996 | ) |  | $ | (21,388 | )
For the Non-U.S. Pension Plans, all of the plans where the projected benefit obligation is in excess of plan assets also have an accumulated benefit obligation that is in excess of plan assets. The summary of the Non-U.S. Pension Plans that have projected benefit obligations and accumulated benefit obligations in excess of plan assets at December 31, 2018 and 2017 is as follows (in thousands):
|  | 2018 |  |  | 2017 |
Projected benefit obligation |  | $ | 60,359 |  |  | $ | 81,498 |
Accumulated benefit obligations |  | $ | 56,029 |  |  | $ | 71,967 |
Fair value of plan assets |  | $ | 44,940 |  |  | $ | 58,865 |
The summary of the components of net periodic pension costs for the plans for the years ended December 31, 2018, 2017 and 2016 is as follows (in thousands):
|  | 2018 |  |  | 2017 |  |  | 2016 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Service cost |  | $ | 568 |  |  | $ | 566 |  |  | $ | 5,368 |  |  | $ | 450 |  |  | $ | 546 |  |  | $ | 5,082 |  |  | $ | 377 |  |  | $ | 473 |  |  | $ | 4,954 |
Interest cost |  |  | 6,491 |  |  |  | 636 |  |  |  | 1,707 |  |  |  | 6,829 |  |  |  | 618 |  |  |  | 1,518 |  |  |  | 6,931 |  |  |  | 557 |  |  |  | 1,699 |
Expected return on plan assets |  |  | (6,833 | ) |  |  | (706 | ) |  |  | (1,974 | ) |  |  | (10,298 | ) |  |  | (587 | ) |  |  | (1,688 | ) |  |  | (9,635 | ) |  |  | (519 | ) |  |  | (1,596 | )
Settlement loss |  |  | 45,157 |  |  |  | — |  |  |  | — |  |  |  | 155 |  |  |  | — |  |  |  | 232 |  |  |  | — |  |  |  | — |  |  |  | — |
Net amortization: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Prior service credit |  |  | — |  |  |  | (19 | ) |  |  | (108 | ) |  |  | — |  |  |  | — |  |  |  | (168 | ) |  |  | — |  |  |  | — |  |  |  | (192 | )
Net actuarial loss |  |  | 3,082 |  |  |  | — |  |  |  | 680 |  |  |  | 2,770 |  |  |  | — |  |  |  | 959 |  |  |  | 2,702 |  |  |  | — |  |  |  | 753 |
Net periodic pension cost (benefit) |  | $ | 48,465 |  |  | $ | 477 |  |  | $ | 5,673 |  |  | $ | (94 | ) |  | $ | 577 |  |  | $ | 5,935 |  |  | $ | 375 |  |  | $ | 511 |  |  | $ | 5,618 |
The summary of the changes in amounts recognized in other comprehensive income (loss) for the plans for the years ended December 31, 2018, 2017 and 2016 is as follows (in thousands):
|  | 2018 |  |  | 2017 |  |  | 2016 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Prior service credit (cost) |  | $ | — |  |  | $ | 130 |  |  | $ | 44 |  |  | $ | — |  |  | $ | — |  |  | $ | (636 | ) |  | $ | — |  |  | $ | — |  |  | $ | — |
Net (loss) gain arising during the year |  |  | (10,616 | ) |  |  | (670 | ) |  |  | 4,088 |  |  |  | 8,879 |  |  |  | 13 |  |  |  | 1,609 |  |  |  | (3,352 | ) |  |  | (594 | ) |  |  | (3,361 | )
Amortization: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Prior service credit |  |  | — |  |  |  | (19 | ) |  |  | (35 | ) |  |  | — |  |  |  | — |  |  |  | (168 | ) |  |  | — |  |  |  | — |  |  |  | (192 | )
Net loss |  |  | 48,239 |  |  |  | — |  |  |  | 680 |  |  |  | 2,925 |  |  |  | — |  |  |  | 1,191 |  |  |  | 2,702 |  |  |  | — |  |  |  | 753 |
Other Plans |  |  | — |  |  |  | — |  |  |  | (354 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (360 | )
Currency impact |  |  | — |  |  |  | — |  |  |  | 583 |  |  |  | — |  |  |  | — |  |  |  | (2,033 | ) |  |  | — |  |  |  | — |  |  |  | 884 |
Total recognized in other comprehensive (loss) income |  | $ | 37,623 |  |  | $ | (559 | ) |  | $ | 5,006 |  |  | $ | 11,804 |  |  | $ | 13 |  |  | $ | (37 | ) |  | $ | (650 | ) |  | $ | (594 | ) |  | $ | (2,276 | )
The summary of the amounts included in accumulated other comprehensive loss in stockholders’ equity for the plans at December 31, 2018 and 2017 is as follows (in thousands):
|  | 2018 |  |  | 2017 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |  |  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Net actuarial (loss) gain |  | $ | (59 | ) |  | $ | (83 | ) |  | $ | (13,987 | ) |  | $ | (37,682 | ) |  | $ | 588 |  |  | $ | (18,857 | )
Prior service credit |  |  | — |  |  |  | 112 |  |  |  | 666 |  |  |  | — |  |  |  | — |  |  |  | 530 |
Total |  | $ | (59 | ) |  | $ | 29 |  |  | $ | (13,321 | ) |  | $ | (37,682 | ) |  | $ | 588 |  |  | $ | (18,327 | )
The summary of the amounts included in accumulated other comprehensive loss expected to be included in next year’s net periodic benefit cost for the plans at December 31, 2018 is as follows (in thousands):
|  | 2018 |
|  | U.S. Pension Plans |  |  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans |
Net actuarial loss |  | $ | — |  |  | $ | — |  |  | $ | (537 | )
Prior service credit |  |  | — |  |  |  | 19 |  |  |  | 147 |
Total |  | $ | — |  |  | $ | 19 |  |  | $ | (390 | )
The plans’ investment asset mix is as follows at December 31, 2018 and 2017:
|  | 2018 |  |  | 2017 |
|  | U.S. Retiree |  |  | Non-U.S. |  |  | U.S. |  |  | U.S. Retiree |  |  | Non-U.S. |
|  | Healthcare |  |  | Pension |  |  | Pension |  |  | Healthcare |  |  | Pension |
|  | Plan |  |  | Plans |  |  | Plans |  |  | Plan |  |  | Plans |
Equity securities |  |  | 61 | % |  |  | 7 | % |  |  | 77 | % |  |  | 65 | % |  |  | 7 | %
Debt securities |  |  | 39 | % |  |  | 18 | % |  |  | 23 | % |  |  | 35 | % |  |  | 16 | %
Cash and cash equivalents |  |  | 0 | % |  |  | 5 | % |  |  | 0 | % |  |  | 0 | % |  |  | 8 | %
Insurance contracts and other |  |  | 0 | % |  |  | 70 | % |  |  | 0 | % |  |  | 0 | % |  |  | 69 | %
Total |  |  | 100 | % |  |  | 100 | % |  |  | 100 | % |  |  | 100 | % |  |  | 100 | %
The plans’ investment policies include the following asset allocation guidelines:
|  | U.S. Retiree Healthcare Plan |  |  | Non-U.S. Pension Plans Policy Target |
|  | Policy Target |  |  | Range |
Equity securities |  |  | 65 | % |  |  | 40% - 90% |  |  |  | 5 | %
Debt securities |  |  | 35 | % |  |  | 10% - 60% |  |  |  | 20 | %
Cash and cash equivalents |  |  | 0 | % |  |  | 0% - 20% |  |  |  | 10 | %
Insurance contracts and other |  |  | 0 | % |  |  | 0% - 20% |  |  |  | 65 | %
The asset allocation policy for the U.S. Retiree Healthcare Plan was developed in consideration of the following long-term investment objectives: achieving a return on assets consistent with the investment policy, achieving portfolio returns which compare favorably with those of other similar plans, professionally managed portfolios and of appropriate market indexes and maintaining sufficient liquidity to meet the obligations of the plan. Within the equity portfolio of the U.S. Retiree Healthcare Plan, investments are diversified among market capitalization and investment strategy, and targets a 20% allocation of the equity portfolio to be invested in financial markets outside of the United States. The Company does not invest in its own stock within the U.S. Retiree Healthcare Plan’s assets. Plan assets are measured at fair value using the following valuation techniques and inputs:
Level 1: |  | The fair value of these types of investments is based on market and observable sources from daily quoted prices on nationally recognized securities exchanges.
Level 2: |  | The fair value of these types of investments utilizes data points other than quoted prices in active markets that are observable either directly or indirectly.
Level 3: |  | These bank and insurance investment contracts are issued by well-known, highly-rated companies. The fair value disclosed represents the present value of future cash flows under the terms of the respective contracts. Significant assumptions used to determine the fair value of these contracts include the amount and timing of future cash flows and counterparty credit risk.
There have been no changes in the above valuation techniques associated with determining the value of the plans’ assets during the years ended December 31, 2018 and 2017. The fair value of the Company’s retirement plan assets are as follows at December 31, 2018 (in thousands):
|  | Total at December 31, 2018 |  |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  |  | Significant Other Observable Inputs (Level 2) |  |  | Significant Unobservable Inputs (Level 3) |
U.S. Retiree Healthcare Plan: Mutual funds(a) |  |  | 11,080 |  |  |  | 11,080 |  |  |  | — |  |  |  | — |
Total U.S. Retiree Healthcare Plan |  |  | 11,080 |  |  |  | 11,080 |  |  |  | — |  |  |  | — |
Non-U.S. Pension Plans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents(b) |  |  | 4,439 |  |  |  | 4,439 |  |  |  | — |  |  |  | — |
Mutual funds(c) |  |  | 20,430 |  |  |  | 20,430 |  |  |  | — |  |  |  | — |
Bank and insurance investment contracts(d) |  |  | 56,718 |  |  |  | — |  |  |  | — |  |  |  | 56,718 |
Total Non-U.S. Pension Plans |  |  | 81,587 |  |  |  | 24,869 |  |  |  | — |  |  |  | 56,718 |
Total fair value of retirement plan assets |  | $ | 92,667 |  |  | $ | 35,949 |  |  | $ | — |  |  | $ | 56,718 |
The fair value of the Company’s retirement plan assets are as follows at December 31, 2017 (in thousands):
|  | Total at December 31, 2017 |  |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  |  | Significant Other Observable Inputs (Level 2) |  |  | Significant Unobservable Inputs (Level 3) |
U.S. Pension Plans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mutual funds(e) |  | $ | 163,438 |  |  | $ | 163,438 |  |  | $ | — |  |  | $ | — |
Total U.S. Pension Plans |  |  | 163,438 |  |  |  | 163,438 |  |  |  | — |  |  |  | — |
U.S. Retiree Healthcare Plan: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mutual funds(f) |  |  | 11,125 |  |  |  | 11,125 |  |  |  | — |  |  |  | — |
Total U.S. Retiree Healthcare Plan |  |  | 11,125 |  |  |  | 11,125 |  |  |  | — |  |  |  | — |
Non-U.S. Pension Plans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents(b) |  |  | 5,783 |  |  |  | 5,783 |  |  |  | — |  |  |  | — |
Mutual funds(g) |  |  | 17,244 |  |  |  | 17,244 |  |  |  | — |  |  |  | — |
Bank and insurance investment contracts(d) |  |  | 51,963 |  |  |  | — |  |  |  | — |  |  |  | 51,963 |
Total Non-U.S. Pension Plans |  |  | 74,990 |  |  |  | 23,027 |  |  |  | — |  |  |  | 51,963 |
Total fair value of retirement plan assets |  |  | 249,553 |  |  | $ | 197,590 |  |  | $ | — |  |  | $ | 51,963 |
Investments valued at NAV |  |  | 7,935 |  |  |  |  |  |  |  |  |  |  |  |  |
Total retirement plan assets |  | $ | 257,488 |  |  |  |  |  |  |  |  |  |  |  |  |
(a) | The mutual fund balance in the U.S. Retiree Healthcare Plan is invested in the following categories: 40% in the common stock of large-cap U.S. companies, 21% in the common stock of international growth companies and 39% in fixed income bonds of U.S. companies and U.S. government.
(b) | Primarily represents deposit account funds held with various financial institutions.
(c) | The mutual fund balance in the Non-U.S. Pension Plans is primarily invested in the following categories: 56% in international bonds, 24% in the common stock of international companies and 20% in various other global investments.
(d) | Amount represents bank and insurance guaranteed investment contracts.
(e) | The mutual fund balance in the U.S. Pension Plans are invested in the following categories: 45% in the common stock of large-cap U.S. companies, 30% in the common stock of international growth companies and 25% in fixed income bonds issued by U.S. companies and by the U.S. government and its agencies.
(f) | The mutual fund balance in the U.S. Retiree Healthcare Plan is invested in the following categories: 41% in the common stock of large-cap U.S. companies, 24% in the common stock of international growth companies and 35% in fixed income bonds of U.S. companies and U.S. government.
(g) | The mutual fund balance in the Non-U.S. Pension Plans is invested in the following categories: 58% in international bonds and 32% in the common stock of international companies, 1% in mortgages and real estate and 9% in various other global investments.
The following table summarizes the changes in fair value of the Level 3 retirement plan assets for the years ended December 31, 2018 and 2017 (in thousands):
|  | Insurance Guaranteed Investment Contracts |
Fair value of assets, December 31, 2016 |  | $ | 45,093 |
Net purchases (sales) and appreciation (depreciation) |  |  | 6,870 |
Fair value of assets, December 31, 2017 |  |  | 51,963 |
Net purchases (sales) and appreciation (depreciation) |  |  | 4,755 |
Fair value of assets, December 31, 2018 |  | $ | 56,718 |
The weighted-average assumptions used to determine the benefit obligation in the consolidated balance sheets at December 31, 2018, 2017 and 2016 are as follows:
|  | 2018 |  |  | 2017 |  |  | 2016 |
|  | U.S. |  |  | Non-U.S. |  |  | U.S. |  |  | Non-U.S. |  |  | U.S. |  |  | Non-U.S. |
Discount rate |  |  | 4.40 | % |  |  | 1.95 | % |  |  | 3.94 | % |  |  | 1.79 | % |  |  | 4.41 | % |  |  | 1.71 | %
Increases in compensation levels |  |  | ** |  |  |  | 2.66 | % |  |  | ** |  |  |  | 2.43 | % |  |  | ** |  |  |  | 2.47 | %
** | Not applicable
The weighted-average assumptions used to determine the net periodic pension cost for the years ended December 31, 2018, 2017 and 2016 are as follows:
|  | 2018 |  |  | 2017 |  |  | 2016 |
|  | U.S. |  |  | Non-U.S. |  |  | U.S. |  |  | Non-U.S. |  |  | U.S. |  |  | Non-U.S. |
Discount rate |  |  | 3.96 | % |  |  | 1.93 | % |  |  | 4.28 | % |  |  | 1.80 | % |  |  | 4.42 | % |  |  | 2.20 | %
Return on plan assets |  |  | 4.35 | % |  |  | 2.75 | % |  |  | 6.53 | % |  |  | 2.64 | % |  |  | 6.47 | % |  |  | 2.74 | %
Increases in compensation levels |  |  | ** |  |  |  | 2.70 | % |  |  | ** |  |  |  | 2.63 | % |  |  | ** |  |  |  | 2.50 | %
** | Not applicable
To develop the expected long-term rate of return on assets assumption, the Company considered historical returns and future expectations for returns for each asset class, as well as the target asset allocation of the pension portfolio and historical expenses paid by the plan. A one-quarter percentage point increase in the assumed long-term rate of return on assets would decrease the Company’s net periodic benefit cost by less than $1 million. A one-quarter percentage point increase in the discount rate would decrease the Company’s net periodic benefit cost by less than $1 million. During fiscal year 2019, the Company expects to contribute a total of approximately $3 million to $6 million to the Company’s defined benefit plans. Estimated future benefit payments from the plans as of December 31, 2018 are as follows (in thousands):
|  | U.S. Pension and Retiree Healthcare Plans |  |  | Non-U.S. Pension Plans |  |  | Total |
2019 |  | $ | 1,084 |  |  | $ | 1,551 |  |  | $ | 2,635 |
2020 |  |  | 1,160 |  |  |  | 2,552 |  |  |  | 3,712 |
2021 |  |  | 1,243 |  |  |  | 2,782 |  |  |  | 4,025 |
2022 |  |  | 1,307 |  |  |  | 2,821 |  |  |  | 4,128 |
2023 |  |  | 1,366 |  |  |  | 3,038 |  |  |  | 4,404 |
2024 - 2028 |  |  | 7,146 |  |  |  | 19,277 |  |  |  | 26,423 |

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- Definition The entire disclosure for pension and other postretirement benefits. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 715 -URI http://asc.fasb.org/topic&trid=2235017 + Details
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