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Pension and Other Post-Retirement Benefit Plans
 12 Months Ended
Dec. 31, 2023
Retirement Benefits [Abstract]  
Pension and Other Post-Retirement Benefit Plans PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS
Defined Benefit and Post-retirement Healthcare Plans
ABX sponsors a qualified defined benefit pension plan for ABX crewmembers and a qualified defined benefit pension plan for a major portion of its ABX employees that meet minimum eligibility requirements. ABX also sponsors non-qualified defined benefit pension plans for certain employees. These non-qualified plans are unfunded. Employees are no longer accruing benefits under any of the defined benefit pension plans. ABX also sponsors a post-retirement healthcare plan for its ABX crewmembers, which is unfunded. Benefits for covered individuals terminate upon reaching age 65 under the post-retirement healthcare plans.
The accounting and valuation for these post-retirement obligations are determined by prescribed accounting and actuarial methods that consider a number of assumptions and estimates. The selection of appropriate assumptions and estimates is significant due to the long time period over which benefits will be accrued and paid. The long term nature of these benefit payouts increases the sensitivity of certain estimates of our post-retirement obligations. The assumptions considered most sensitive in actuarially valuing ABX’s pension obligations and determining related expense amounts are discount rates and expected long term investment returns on plan assets. Additionally, other assumptions concerning retirement ages, mortality and employee turnover also affect the valuations. Actual results and future changes in these assumptions could result in future costs significantly higher than those recorded in our results of operations.
During December 2023, the Company transferred investment assets totaling $112.3 million from the pension plan trust to purchase a group annuity contract from Nationwide Life Insurance Company ("NLIC") for certain former non-pilot retirees of ABX (or their beneficiaries). The group annuity contract transfers the related payment
obligations to NLIC. Additionally, during December 2023, the Company offered certain vested, non-pilot ABX employee participants of the pension plan a one-time option to settle their pension benefit with the Company through a single payment or a nonparticipating annuity contract. As a result, the Company settled $27.3 million of pension obligations in December 2023 using pension plan assets. As a result of these settlement transactions, the Company recognized pre-tax settlement charges of $24.1 million due to the reclassification of losses from accumulated other comprehensive loss to the statement of operations.
Pension plan assets and benefit obligations are measured annually, as of December 31 of each year. Information regarding ABX’s sponsored defined benefit pension plans and post-retirement healthcare plans follow below. The accumulated benefit obligation reflects pension benefit obligations based on the actual earnings and service to-date of current employees.
Funded Status (in thousands):
 Pension PlansPost-retirement
Healthcare Plans
 2023202220232022
Accumulated benefit obligation$521,959 $648,242 $1,957 $2,672 
Change in benefit obligation
Obligation as of January 1$648,242 $839,267 $2,672 $3,142 
Service cost— — 53 76 
Interest cost34,526 24,173 132 59 
Special termination benefits— — — — 
Plan amendment— — — — 
Plan transfers2,276 2,386 — — 
Benefits paid(39,643)(37,998)(306)(308)
Settlements(139,605)— — — 
Actuarial (gain) loss16,163 (179,586)(594)(297)
Obligation as of December 31$521,959 $648,242 $1,957 $2,672 
Change in plan assets
Fair value as of January 1$627,032 $850,195 $— $— 
Actual (loss) gain on plan assets72,006 (188,855)— — 
Plan transfers2,276 2,386 — — 
Return of excess premiums— — — — 
Employer contributions1,310 1,304 306 308 
Benefits paid(39,643)(37,998)(306)(308)
Settlement payments$(139,605)$— $— $— 
Fair value as of December 31$523,376 $627,032 $— $— 
Funded status0000
Overfunded plans, net asset$20,526 $13,194 $— $— 
Underfunded plans
Current liabilities$(1,380)$(1,343)$(319)$(401)
Non-current liabilities$(17,731)$(33,063)$(1,638)$(2,271)
Components of Net Periodic Benefit Cost
ABX’s net periodic benefit costs for its defined benefit pension plans and post-retirement healthcare plans for the years ended December 31, 2023, 2022 and 2021, are as follows (in thousands):
 Pension PlansPost-Retirement Healthcare Plan
 202320222021202320222021
Service cost$— $— $— $53 $76 95 
Interest cost34,526 24,173 22,387 132 59 42 
Expected return on plan assets(40,767)(46,954)(47,502)— — — 
Settlements24,145 — — — — — 
Amortization of prior service cost— — — — — — 
Amortization of net loss18,981 2,630 7,058 — 45 186 
Net periodic benefit cost (income)$36,885 $(20,151)$(18,057)$185 $180 $323 
Unrecognized Net Periodic Benefit Expense
The pre-tax amounts in accumulated other comprehensive loss that have not yet been recognized as components of net periodic benefit expense at December 31 are as follows (in thousands):
 Pension PlansPost-Retirement
Healthcare Plans
 2023202220232022
Unrecognized prior service cost$— $— $— $— 
Unrecognized net actuarial loss86,066 144,268 (518)76 
Accumulated other comprehensive loss$86,066 $144,268 $(518)$76 
The amounts of unrecognized net actuarial loss recorded in accumulated other comprehensive loss that is expected to be recognized as components of net periodic benefit expense during 2024 is $10.4 million and $0.1 million for the pension plans and the post-retirement healthcare plans, respectively.
Assumptions
Assumptions used in determining the funded status of ABX’s pension plans at December 31 were as follows:
 
 Pension Plans
 202320222021
Discount rate - crewmembers5.25%5.50%2.90%
Discount rate - non-crewmembers5.15%5.50%3.00%
Expected return on plan assets - crewmembers6.40%6.75%5.65%
Expected return on plan assets - non-crewmembers6.40%6.65%5.65%
Net periodic benefit cost was based on the discount rate assumptions at the end of the previous year.
The discount rate used to determine post-retirement healthcare obligations was 5.10%, 5.35% and 2.00% for pilots at December 31, 2023, 2022 and 2021, respectively. Post-retirement healthcare plan obligations have not been funded. The Company's retiree healthcare contributions have been fixed for each participant, accordingly, healthcare cost trend rates do not affect the post-retirement healthcare obligations.
Plan Assets
The weighted-average asset allocations by asset category are as shown below:
 
 Composition of Plan Assets
as of December 31
Asset category20232022
Cash1 %3 %
Equity securities28 %27 %
Fixed income securities71 %70 %
100 %100 %
ABX uses an investment management firm to advise it in developing and executing an investment policy. The portfolio is managed with consideration for diversification, quality and marketability. The investment policy permits the following ranges of asset allocation: equities – 15% to 35%; fixed income securities – 60% to 80%; cash – 0% to 10%. Except for U.S. Treasuries, no more than 10% of the fixed income portfolio and no more than 5% of the equity portfolio can be invested in securities of any single issuer.
The overall expected long term rate of return was developed using various market assumptions in conjunction with the plans’ targeted asset allocation. The assumptions were based on historical market returns.
Cash Flows
In 2023 and 2022, the Company made contributions to its defined benefit plans of $1.3 million and $1.3 million, respectively. The Company estimates that its contributions in 2024 will be approximately $1.4 million for its defined benefit pension plans and $0.3 million for its post-retirement healthcare plans.
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid out of the respective plans as follows (in thousands):
 Pension
Benefits		Post-retirement
Healthcare
Benefits
2024$33,392 $319 
202535,704 337 
202637,266 347 
202738,868 348 
202840,026 279 
Years 2029 to 2033199,310 691 
Fair Value Measurements
The pension plan assets are stated at fair value. The following is a description of the valuation methodologies used for the investments measured at fair value, including the general classification of such instruments pursuant to the valuation hierarchy.
Common Trust Funds—Common trust funds are composed of shares or units in non-publicly traded funds whereby the underlying assets in these funds (cash, cash equivalents, fixed income securities and equity securities) are publicly traded on exchanges and price quotes for the assets held by these funds are readily available. Holdings of common trust funds are classified as Level 2 investments.
Mutual Funds—Investments in this category include shares in registered mutual funds, unit trust and commingled funds. These funds consist of domestic equity, international equity and fixed income strategies. Investments in this category that are publicly traded on an exchange and have a share price published at the close of each business day are classified as Level 1 investments and holdings in the other mutual funds are classified as Level 2 investments.
Fixed Income Investments—Securities in this category consist of U.S. Government or Agency securities, state and local government securities, corporate fixed income securities or pooled fixed income securities. Securities in this category that are valued utilizing published prices at the close of each business day are classified as Level 1 investments. Those investments valued by bid data prices provided by independent pricing sources are classified as Level 2 investments.
The pension plan assets measured at fair value on a recurring basis were as follows (in thousands):
As of December 31, 2023Fair Value Measurement UsingTotal
 Level 1Level 2
Plan assets
Common trust funds$— $2,908 $2,908 
Mutual funds— 34,569 34,569 
Fixed income investments— 373,235 373,235 
Benefit Plan Assets$— $410,712 $410,712 
Investments measured at net asset value ("NAV")112,664 
Total benefit plan assets$523,376 
As of December 31, 2022Fair Value Measurement UsingTotal
 Level 1Level 2
Plan assets
Common trust funds$— $19,114 $19,114 
Mutual funds— 166,143 166,143 
Fixed income investments— 441,772 441,772 
Benefit Plan Assets$— $627,029 $627,029 
Investments measured at net asset value ("NAV")3 
Total benefit plan assets$627,032 
Investments that were measured at NAV per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. These investments include hedge funds, private equity and real estate funds. Management’s estimates are based on information provided by the fund managers or general partners of those funds.
Hedge Funds and Private Equity—These investments are not readily tradable and have valuations that are not based on readily observable data inputs. The fair value of these assets is estimated based on information provided by the fund managers or the general partners. These assets have been valued using NAV as a practical expedient.
The following table presents investments measured at fair value based on NAV per share as a practical expedient:
 Fair ValueRedemption FrequencyRedemption Notice PeriodUnfunded Commitments
As of December 31, 2023
Common trust$112,664 (2) (3)30 days$— 
Total investments measured at NAV$112,664 $— 
As of December 31, 2022
Hedge Funds & Private Equity$3 (1)90 days$— 
Total investments measured at NAV$3 $— 

(1) Quarterly - hedge funds
(2) Daily
(3) Monthly

Defined Contribution Plans
The Company sponsors defined contribution capital accumulation plans (401k) that are funded by both voluntary employee salary deferrals and by employer contributions. Expenses for defined contribution retirement plans were $21.6 million, $20.9 million and $19.5 million for the years ended December 31, 2023, 2022 and 2021, respectively.