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Note 7 - Pension and Other Postretirement Benefits
 6 Months Ended
Jun. 30, 2021
Notes to Financial Statements  
Retirement Benefits [Text Block]

NOTE 7 - PENSION AND OTHER POSTRETIREMENT BENEFITS

 

The Company sponsors a defined benefit pension plan (“Plan”) covering certain domestic employees. Benefits are based on each covered employee’s years of service and compensation. The Plan is funded in conformity with the funding requirements of applicable U.S. regulations. The Plan was closed to new participants effective January 1, 2008. Employees hired after this date, in eligible locations, participate in an enhanced 401(k) plan instead of the defined benefit pension plan. Employees hired prior to this date continue to accrue benefits.

 

Additionally, the Company sponsors defined contribution pension plans made available to all domestic and Canadian employees. The Company funds the cost of these benefits as incurred.

 

The Company also sponsors a non-contributory defined benefit postretirement health care plan that provides health benefits to certain domestic and Canadian retirees and eligible spouses and dependent children. The Company funds the cost of these benefits as incurred.

 

The following tables present the components of net periodic benefit costs:

 

  

Pension Benefits

  

Postretirement Benefits

 
  

Three Months Ended
June 30,

  

Three Months Ended
June 30,

 
  

2021

  

2020

  

2021

  

2020

 

Service cost

 $649  $659  $365  $343 

Interest cost

  394   555   163   194 

Expected return on plan assets

  (906

)

  (958

)

  -   - 

Amortization of prior service cost

  -   -   (282

)

  (282

)

Recognized actuarial loss

  544   621   145   77 

Settlement loss

  1,728   1,904   -   - 

Net periodic benefit cost (a)

 $2,409  $2,781  $391  $332 

 

  

Pension Benefits

  

Postretirement Benefits

 
  

Six Months Ended
June 30,

  

Six Months Ended
June 30,

 
  

2021

  

2020

  

2021

  

2020

 

Service cost

 $1,398  $1,342  $731  $686 

Interest cost

  785   1,091   327   389 

Expected return on plan assets

  (1,800

)

  (1,943

)

  -   - 

Amortization of prior service cost

  -   -   (565

)

  (564

)

Recognized actuarial loss

  1,059   1,134   290   153 

Settlement loss

  1,728   3,382   -   - 

Net periodic benefit cost (a)

 $3,170  $5,006  $783  $664 

 

 

(a)

The components of net periodic benefit cost other than the service cost component are included in Other income (expense), net in the Consolidated Statements of Income.

 

During the second quarter and six months ended June 30, 2021, the Company recorded a settlement loss relating to retirees that received lump-sum distributions from the Company’s defined benefit pension plan totaling $1.7 million. The Company recorded settlement losses of $1.9 million and $3.4 million for the second quarter and six months ended June 30, 2020, respectively. These charges were the result of lump-sum payments to retirees exceeding the Plan’s actuarial service and interest cost thresholds.