Retirement Plans

12 Months Ended

Dec. 31, 2022

Retirement Plans [Abstract]

Retirement Plans

9. Retirement Plans

The Company provides benefits under defined contribution plans including a savings plan and an employee stock ownership plan (ESOP). The savings plan covers substantially all domestic salaried and certain non-union hourly employees and provides for matching contributions up to 4% of each employee’s salary. The ESOP covers substantially all domestic employees and provides for contributions based on a percentage of each employee’s compensation as determined by the Company’s Board of Directors. Total expense for the Company’s defined contribution plans was $7.8 million in 2022, $6.7 million in 2021, and $6.1 million in 2020.

Although the Company intends for these defined contribution plans to be the primary retirement benefit for most employees, the Company also has several defined benefit plans. The funded status of the defined benefit plans was as follows at December 31:

(In thousands)	2022			2021
Benefit obligation at beginning of year	$	41,780		$	45,631
Service cost		1,622			1,740
Interest cost		953			851
Foreign currency exchange rate changes		(1,488	)		(291	)
Benefits and settlements paid		(1,724	)		(3,298	)
Actuarial gain		(8,776	)		(2,853	)
Benefit obligation at end of year		32,367			41,780
Plan assets at beginning of year		32,982			35,676
Company contributions		1,027			947
Foreign currency exchange rate changes		(2,430	)		(297	)
Benefits paid		(1,724	)		(1,718	)
Settlement payments		-			(1,580	)
Actual loss on plan assets		(9,926	)		(46	)
Plan assets at end of year		19,929			32,982
Funded status	$	(12,438	)	$	(8,798	)
Accumulated benefit obligation	$	31,472		$	40,873

Amounts recognized in the Consolidated Balance Sheets at December 31:

(In thousands)	2022			2021
Accrued employee and retiree benefits	$	(16,822	)	$	(18,375	)
Other accrued expenses		(745	)		(693	)
Other assets		5,129			10,270
Net liability	$	(12,438	)	$	(8,798	)

Components of annual benefit cost:

(In thousands)	2022			2021			2020
Service cost	$	1,622		$	1,740		$	1,601
Interest cost		953			851			1,022
Expected return on plan assets		(785	)		(728	)		(813	)
Recognized actuarial loss		32			267			41
Settlement income		-			(151	)		-
Defined benefit expense	$	1,822		$	1,979		$	1,851

The Company’s non-service cost portion of defined benefit expense is recorded in Interest Expense on the Company’s Consolidated Statements of Earnings. The Company’s service cost portion of defined benefit expense is recorded in Selling and Administrative Expenses on the Company’s Consolidated Statements of Earnings.

Weighted average liability assumptions as of December 31:

	2022			2021
Discount rate		5.12	%		2.35	%
Expected return on plan assets		4.89	%		2.54	%
Rate of compensation increase		0.90	%		1.02	%

Weighted average cost assumptions for the year ended December 31:

	2022			2021			2020
Discount rate		2.35	%		1.87	%		2.69	%
Expected return on plan assets		2.54	%		2.17	%		2.68	%
Rate of compensation increase		1.02	%		1.07	%		0.88	%

The aggregate amounts of benefits expected to be paid from defined benefit plans in each of the next five years subsequent to December 31, 2022, which include employees’ expected future service, are as follows: 2023, $1.7 million; 2024, $9.0 million; 2025, $1.5 million; 2026, $1.6 million; 2027, $1.6 million; and $10.1 million in total for the years 2028 through 2032.

The Company expects to contribute $0.8 million to defined benefit plans in 2023.

Amounts in accumulated other comprehensive loss at December 31 were as follows:

(In thousands)	2022		2021
Unrecognized net actuarial loss	$	2,210	$	221
Prior service cost		153		179
Total before tax effects	$	2,363	$	400

The pension adjustments, net of tax, recognized in OCI, were as follows:

(In thousands)	2022			2021		2020
Net actuarial (loss) gain arising during the period	$	(1,466	)	$	1,528	$	(1,293	)
Prior service cost		-			-		(32	)
Amortization of actuarial loss, included in defined benefit expense		27			84		32
Pension adjustment, net of tax	$	(1,439	)	$	1,612	$	(1,293	)

The investment objectives and target allocations for the Company’s pension plans related to the assets of the plans are reviewed on a regular basis. The investment objectives for the pension assets are to maximize the return on assets while maintaining an overall level of risk appropriate for a retirement fund and ensuring the availability of funds for the payment of retirement benefits. The levels of risk assumed by the pension plans are determined by market conditions, the rate of return expectations, and the liquidity requirements of each pension plan. The actual asset allocations of each pension plan are reviewed on a regular basis to ensure that they are in line with the target allocations.

The following table presents the Company’s pension plan assets by asset category as of December 31, 2022 and 2021:

	Fair Value as of December 31,		Fair Value Measurements at December 31, 2022 Using Fair Value Hierarchy						Fair Value as of December 31,		Fair Value Measurements at December 31, 2021 Using Fair Value Hierarchy
(In thousands)	2022		Level 1		Level 2		Level 3		2021		Level 1		Level 2		Level 3
Equity Funds
Domestic	$	5,208	$	5,208	$	—	$	—	$	7,033	$	7,033	$	—	$	—
International		55		—		55		—		79		—		79		—
International Fixed Income Funds		14,551		1,060		13,491		—		25,732		889		24,843		—
Other investments		115		84		31		—		138		115		23		—
Total assets at fair value	$	19,929	$	6,352	$	13,577	$	—	$	32,982	$	8,037	$	24,945	$	—

The Company is required to categorize pension plan assets based on the following fair value hierarchy:

Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability through corroboration with observable market data.

Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions.