Postretirement benefits other than pensions (Other Postretirement Benefit Plans, Defined Benefit)

12 Months Ended

Dec. 30, 2012

Other Postretirement Benefit Plans, Defined Benefit

Defined Benefit Plan Disclosure [Line Items]

Pension and Other Postretirement Benefits Disclosure

NOTE 9

Postretirement benefits other than pensions

The company provides health care and life insurance benefits to certain retired employees who meet age and service requirements. Most of the company’s retirees contribute to the cost of these benefits and retiree contributions are increased as actual benefit costs increase. The cost of providing retiree health care and life insurance benefits is actuarially determined and accrued over the service period of the active employee group. The company’s policy is to fund benefits as claims and premiums are paid. The company eliminated postretirement medical and life insurance benefits for most U.S. employees under 50 years of age effective Jan. 1, 2006. The company uses a Dec. 31 measurement date for these plans.

Postretirement benefit cost for health care and life insurance included the following components:

In thousands of dollars
	2012			2011			2010
Service cost – benefits earned during the period	$	545		$	611		$	713
Interest cost on net benefit obligation	7,744			9,205			10,606
Amortization of prior service credit	(19,190		)	(19,510		)	(19,377		)
Amortization of actuarial loss	1,943			5,444			4,949
Net periodic postretirement benefit	$	(8,958	)	$	(4,250	)	$	(3,109	)

The table below provides a reconciliation of benefit obligations and funded status of the company’s postretirement benefit plans:

In thousands of dollars
	Dec. 30, 2012			Dec. 25, 2011
Change in benefit obligations
Net benefit obligations at beginning of year	$	184,131		$	191,282
Service cost	545			611
Interest cost	7,744			9,205
Plan participants’ contributions	10,362			10,896
Actuarial (gain) loss	(5,877		)	2,482
Gross benefits paid	(29,245		)	(32,386		)
Federal subsidy on benefits paid	1,932			2,041
Net benefit obligations at end of year	$	169,592		$	184,131
Change in plan assets
Fair value of plan assets at beginning of year	$	—		$	—
Employer contributions	18,883			21,490
Plan participants’ contributions	10,362			10,896
Gross benefits paid	(29,245		)	(32,386		)
Fair value of plan assets at end of year	$	—		$	—
Benefit obligation at end of year	$	169,592		$	184,131
Accrued postretirement benefit cost:
Current	$	19,655		$	20,432
Noncurrent	$	149,937		$	163,699

Net actuarial losses recognized in accumulated other comprehensive loss were $23.5 million in 2012 and $30.8 million in 2011. Prior service credits recognized in accumulated other comprehensive loss were $24.9 million as of Dec. 30, 2012 and $44.1 million as of Dec. 25, 2011.

The actuarial loss and prior service credit estimated to be amortized from accumulated other comprehensive loss into net periodic benefit cost in 2013 are $1.9 million and $9.2 million, respectively.

Other changes in plan assets and benefit obligations recognized in other comprehensive (loss) consist of the following:

In thousands of dollars
	2012
Current year actuarial gain	$	5,364
Amortization of actuarial loss	1,943
Amortization of prior service credit	(19,190		)
Total	$	(11,883	)

Postretirement benefit costs: The following assumptions were used to determine postretirement benefit cost:

	2012		2011		2010
Discount rate	4.75	%	5.30	%	5.80	%
Health care cost trend rate assumed for next year	6.50	%	6.50	%	6.50	%
Ultimate trend rate	5.00	%	5.00	%	5.00	%
Year that ultimate trend rate is reached	2016		2015		2014

Benefit obligations and funded status: The following assumptions were used to determine the year-end benefit obligation:

	Dec. 30, 2012		Dec. 25, 2011
Discount rate	3.80	%	4.75	%
Health care cost trend rate assumed for next year	6.50	%	6.50	%
Ultimate trend rate	5.00	%	5.00	%
Year that ultimate trend rate is reached	2016		2015

Assumed health care cost trend rates have an effect on the amounts reported for the health care plans. The effect of a 1% change in the health care cost trend rate would result in a change of approximately $7.0 million in the 2012 postretirement benefit obligation and a $0.3 million change in the aggregate service and interest components of the 2012 expense.

Cash flows: The company expects to make the following benefit payments, which reflect expected future service, and to receive the following federal subsidy benefits as appropriate:

In thousands of dollars	Benefit Payments		Subsidy Benefits
2013	$	19,655	$	4,360
2014	$	19,154	$	3,626
2015	$	18,559	$	3,592
2016	$	17,751	$	3,501
2017	$	16,927	$	3,439
2018-2022	$	69,422	$	15,361

The amounts above exclude the participants’ share of the benefit cost. The company’s policy is to fund benefits as claims and premiums are paid.