Employer Sponsored Benefit Plans

3 Months Ended

Mar. 31, 2020

Prior to the quarter ended March 31, 2020, the Company maintained two domestic pension plans: the Retirement Income Plan for Employees of Interface Performance Materials, Inc. ("IPM Pension Plan"), and the Interface Sealing Solutions, Inc. Pension Plan ("ISS Pension Plan"). During the quarter ended March 31, 2020, the Company settled the pension obligation of the ISS Pension Plan through lump sum distributions to participants or by irrevocably transferring pension liabilities to an insurance company through the purchase of a group annuity contract. This purchase, funded with pension assets, resulted in a pre-tax settlement loss of $0.4 million in the quarter ended March 31, 2020, related to the recognition of accumulated deferred actuarial losses. The settlement loss and expenses were included as non-operating expense in the condensed consolidated statements of operations.

The IPM Pension Plan covers a portion of Interface's union and non-union employees. The plan is closed to new employees and benefits are no longer accruing for the majority of participants. The Company expects to make required contributions of approximately $1.2 million to the IPM Pension Plan during 2020. Contributions of $0.4 million and $0.6 million were made during the quarters ended March 31, 2020 and March 31, 2019, respectively.

Prior to 2020, the Company also maintained the U.S.Lydall Pension Plan. During the second quarter of 2019, the Company settled the pension obligation of the U.S. Lydall Pension Plan through lump sum distributions to participants or by irrevocably transferring pension liabilities to two insurance companies through the purchase of group annuity contracts. No contributions were made to the U.S. Lydall Pension Plan during the quarter ended March 31, 2019.

The following is a summary of the components of net periodic benefit cost for the domestic defined benefit pension plans for the quarters ended March 31, 2020 and 2019:



	Quarters Ended March 31,
In thousands	2020			2019
Components of employer benefit cost
Service cost	$	40		$	30
Interest cost	430			982
Expected return on assets	(533		)	(872		)
Amortization of actuarial loss	2			278
Net periodic benefit cost	$	(61	)	$	418
Settlement loss	385			—
Total employer benefit plan cost	$	324		$	418

The Company reports the service cost component of net periodic benefit cost in the same line item as other compensation costs in operating expenses and the non-service cost components of net periodic benefit cost in other income.