Employee Benefit Plans

12 Months Ended

Dec. 31, 2021

Retirement Benefits [Abstract]

Employee Benefit Plans

Employee Benefit Plans

Pension and Profit-Sharing Benefits

The Company provides a defined contribution profit sharing plan for the benefit of substantially all the Company's domestic salaried and non-union hourly employees. The plan contains both contributory and noncontributory profit sharing arrangements, as defined. Aggregate charges included in the accompanying consolidated statement of operations under this plan for both continuing and discontinued operations were approximately $3.4 million in both 2021 and 2020 and $4.6 million in 2019. Certain of the Company's non-U.S. and union hourly employees participate in defined benefit pension plans.

Plan Assets, Expenses and Obligations

Net periodic pension benefit expense recorded in the Company's consolidated statement of operations for defined benefit pension plans include the following components (dollars in thousands):

	Pension Benefit
	2021		2020		2019
Service cost	$	1,280	$	1,230	$	1,050
Interest cost	800		930		1,070
Expected return on plan assets	(1,530)		(1,450)		(1,400)
Amortization of net loss	910		890		580
Net periodic benefit expense	$	1,460	$	1,600	$	1,300

The service cost component of net periodic benefit expense is recorded in cost of goods sold and selling, general and administrative expenses, while non-service cost components are recorded in other expense, net in the accompanying consolidated statement of operations.

Actuarial valuations of the Company's defined benefit pension plans were prepared as of December 31, 2021, 2020 and 2019. Weighted average assumptions used in accounting for the U.S. defined benefit pension plans are as follows:

	Pension Benefit
	2021		2020		2019
Discount rate for obligations	3.06	%	2.79	%	3.41	%
Discount rate for benefit costs	2.79	%	3.41	%	4.50	%
Rate of increase in compensation levels	N/A		N/A		N/A
Expected long-term rate of return on plan assets	6.13	%	6.13	%	7.13	%

The Company utilizes a high-quality (Aa or greater) corporate bond yield curve as the basis for its domestic discount rate for its pension benefit plans. Management believes this yield curve removes the impact of including additional required corporate bond yields (potentially considered in the above-median curve) resulting from the uncertain economic climate that does not necessarily reflect the general trend in high-quality interest rates.

Weighted average assumptions used in accounting for the non-U.S. defined benefit pension plans are as follows:

	Pension Benefit
	2021		2020		2019
Discount rate for obligations	2.10	%	1.50	%	2.10	%
Discount rate for benefit costs	1.50	%	2.10	%	3.00	%
Rate of increase in compensation levels	3.30	%	2.80	%	3.00	%
Expected long-term rate of return on plan assets	3.90	%	4.10	%	4.60	%

The following provides a reconciliation of the changes in the Company's defined benefit pension plans' projected benefit obligations and fair value of assets for each of the years ended December 31, 2021 and 2020 and the funded status as of December 31, 2021 and 2020 (dollars in thousands):

	Pension Benefit
	2021		2020
Changes in Projected Benefit Obligations
Benefit obligations at January 1	$	(40,830)	$	(36,580)
Service cost	(1,280)		(1,230)
Interest cost	(800)		(930)
Participant contributions	(50)		(60)
Actuarial gain (loss) (a)	3,290		(2,420)
Benefit payments	1,840		1,140
Change in foreign currency	270		(750)
Projected benefit obligations at December 31	$	(37,560)	$	(40,830)
Changes in Plan Assets
Fair value of plan assets at January 1	$	36,060	$	30,260
Actual return on plan assets	2,060		4,780
Employer contributions	2,050		1,140
Participant contributions	50		60
Benefit payments	(1,840)		(1,140)
Change in foreign currency	(250)		960
Fair value of plan assets at December 31	$	38,130	$	36,060
Funded status at December 31	$	570	$	(4,770)

__________________________

(a) The actuarial gain for the year ended December 31, 2021 was primarily due to an increase in the discount rate utilized in measuring the projected benefit obligations as well as other assumptions and experience gains. The actuarial loss for the year ended December 31, 2020 was primarily due to a decrease in the discount rate utilized in measuring the projected benefit obligations, partially offset by other assumptions and experience gains.

	Pension Benefit
	2021		2020
Amounts Recognized in Balance Sheet
Other assets	$	7,740	$	4,470
Current liabilities	(300)		(340)
Noncurrent liabilities	(6,870)		(8,900)
Net asset (liability) recognized at December 31	$	570	$	(4,770)

	Pension Benefit
	2021		2020
Amounts Recognized in Accumulated Other Comprehensive Loss
Unrecognized prior service cost	$	310	$	170
Unrecognized net loss	6,550		11,470
Total accumulated other comprehensive loss recognized at December 31	$	6,860	$	11,640

	Accumulated Benefit Obligations				Projected Benefit Obligations
	2021		2020		2021		2020
Benefit Obligations at December 31,
Total benefit obligations	$	(35,970)	$	(38,410)	$	(37,560)	$	(40,830)
Plans with benefit obligations exceeding plan assets
Benefit obligations	$	(16,630)	$	(16,820)	$	(16,780)	$	(16,940)
Plan assets	$	9,610	$	7,700	$	9,610	$	7,700

The assumptions regarding discount rates and expected return on plan assets can have a significant impact on amounts reported for benefit plans. A 25 basis point change in benefit obligation discount rates or 50 basis point change in expected return on plan assets would have the following effect (dollars in thousands):

	Pension Benefit
	December 31, 2021 Benefit Obligation		2021 Expense
Discount rate
25 basis point increase	$	(1,570)	$	(50)
25 basis point decrease	$	1,670	$	50
Expected return on assets
50 basis point increase	N/A		$	(190)
50 basis point decrease	N/A		$	190

The Company expects to make contributions of approximately $1.6 million to fund its pension plans during 2022.

Plan Assets

The Company's overall investment goal is to provide for capital growth with a moderate level of volatility by investing assets in targeted allocation ranges. Specific long term investment goals include total investment return, diversity to reduce volatility and risk, and to achieve an asset allocation profile that reflects the general nature and sensitivity of the plans' liabilities. Investment goals are established after a comprehensive review of current and projected financial statement requirements, plan assets and liability structure, market returns and risks as well as special requirements of the plans. The Company reviews investment goals and actual results annually to determine whether stated objectives are still relevant and the continued feasibility of achieving the objectives.

The actual weighted average asset allocation of the Company's domestic and foreign pension plans' assets at December 31, 2021 and 2020 and target allocations by class, were as follows:

	Domestic Pension						Foreign Pension
			Actual						Actual
	Target		2021		2020		Target		2021		2020
Equity securities	60	%	62	%	67	%	33	%	34	%	33	%
Fixed income	36	%	37	%	32	%	45	%	44	%	44	%
Diversified growth(a)	—	%	—	%	—	%	22	%	22	%	22	%
Cash and other	4	%	1	%	1	%	—		—	%	1	%
Total	100	%	100	%	100	%	100	%	100	%	100	%

________________________________________

(a) Diversified growth funds invest in a broad range of asset classes including equities, investment grade and high yield bonds, commodities, property, private equity, infrastructure and currencies.

Actual allocations to each asset vary from target allocations due to periodic investment strategy changes, market value fluctuations and the timing of benefit payments and contributions. The expected long-term rate of return for both the domestic and foreign plans' total assets is based on the expected return of each of the above categories, weighted based on the target allocation for each class. Actual allocation is reviewed regularly and investments are rebalanced to their targeted allocation range when deemed appropriate.

In managing the plan assets, the Company reviews and manages risk associated with the funded status risk, interest rate risk, market risk, liquidity risk and operational risk. Investment policies reflect the unique circumstances of the respective plans and include requirements designed to mitigate these risks by including quality and diversification standards.

The following table summarizes the level under the fair value hierarchy (see Note 3, "Summary of Significant Accounting Policies") that the Company's pension plan assets are measured, on a recurring basis as of December 31, 2021 (dollars in thousands):

	Total		Level 1		Level 2		Level 3
Plan assets subject to leveling
Investment funds
Equity securities	$	5,970	$	5,970	$	—	$	—
Fixed income	3,510		3,510		—		—
Cash and cash equivalents	70		70		—		—
Plan assets measured at net asset value(a)
Investment funds
Equity securities	9,540
Fixed income	12,360
Diversified growth	6,380
Cash and cash equivalents	300
Total	$	38,130	$	9,550	$	—	$	—

________________________________________

(a) Certain investments that are measured at fair value using the net asset value per share as a practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amount presented in the fair value of plan assets.

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid during the following years (dollars in thousands):

	Pension Benefit
2022	$	1,170
2023	1,210
2024	1,260
2025	1,310
2026	1,350
Years 2027-2031	7,920