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BENEFIT PLANS:
 9 Months Ended
Sep. 30, 2013
BENEFIT PLANS:  
BENEFIT PLANS:

NOTE 8- BENEFIT PLANS:

 

Post retirement defined benefit plans

 

The Company has two noncontributory defined benefit pension plans covering former salaried employees in the United States and certain former employees in Peru. Effective October 31, 2000, the Board of Directors amended the qualified pension plan to suspend the accrual of benefits.

 

In addition, the Company’s Mexican subsidiaries have a defined contribution benefit pension plan for salaried employees and a noncontributory defined benefit pension plan for union employees.

 

The components of the net periodic benefit costs for the nine months ended September 30, 2013 and 2012 are as follows (in millions):

 

 

 

2013

 

2012

 

Interest cost

 

$

0.8

 

$

0.9

 

Service cost

 

1.0

 

0.7

 

Expected return on plan assets

 

(2.5

)

(2.7

)

Amortization of net loss

 

0.1

 

0.1

 

Amortization of net actuarial loss

 

(0.6

)

(0.6

)

Net periodic benefit cost

 

$

(1.2

)

$

(1.6

)

 

Post-retirement health care plan

 

Peru: In 1996, the Company adopted a post-retirement health care plan for retired salaried employees eligible for Medicare. The plan is unfunded. The Company manages the plan and is currently providing health benefits to retirees. The plan is accounted for in accordance with ASC 715 “Compensation retirement benefits.”

 

Mexico: Through 2007, the Buenavista unit provided health care services free of charge to employees and retired unionized employees and their families through its own hospital at the Buenavista unit. In 2011, the Company signed an agreement with the Secretary of Health of the State of Sonora to provide these services to its retired workers and their families at a lower cost for the Company but still free of charge to the retired workers.

 

The components of the net periodic cost for the nine months ended September 30, 2013 and 2012 are as follows (in millions):

 

 

 

2013

 

2012

 

Interest cost

 

$

1.2

 

$

1.1

 

Amortization of net loss (gain)

 

—

 

(0.2

)

Amortization of prior service cost (credit)

 

—

 

—

 

Net periodic benefit cost

 

$

1.2

 

$

0.9