Note 4 - Periodic Pension Expense

6 Months Ended

Jun. 30, 2021

Notes to Financial Statements

Retirement Benefits [Text Block]

NOTE 4 – Periodic Pension Expense:

The Company had previously sponsored two noncontributory qualified defined benefit pension plans, providing for normal retirement at age 65, covering all eligible employees (as defined). Effective June 30, 2013, the Company no longer accrues additional benefits for future service or for future increases in compensation levels for the Company’s primary defined benefit pension plan. Effective on December 31, 2014, the Company no longer accrues additional benefits for future service for the Company’s hourly defined benefit plan. As discussed below, the Company terminated its two noncontributory qualified defined benefit pension plans in the second quarter of 2021.

The Company is also the sponsor of an unfunded supplemental executive retirement plan in which several of its employees are participants.

The following table details the net periodic pension expense under the Company’s plans for the periods presented (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Service cost - benefits earned during the period	$	46		$	38		$	92		$	76
Interest cost on projected benefit obligation		153			216			340			432
Expected return on plan assets		(239	)		(389	)		(597	)		(778	)
Recognized actuarial loss		526			313			1,126			633
Settlement loss		-			193			-			331
Pension plan termination charge		6,945			-			6,945			-
Net periodic pension cost after settlements	$	7,431		$	371		$	7,906		$	694

The pension settlement losses included in the table above resulted from lump sum pension payments made to various employees upon their retirement or termination during the periods specified. The pension settlement losses did not require a cash outlay by the Company. The service cost component is included in selling and administrative expenses in our statements of comprehensive income and the other components of net periodic pension cost are included in other periodic pension costs in our statements of comprehensive income.

In the second quarter of 2021, the Company terminated its two noncontributory qualified defined benefit pension plans, which were fully funded. The Company settled its obligations under the plans by providing lump-sum payments of $13.8 million to eligible participants who elected to receive them and entering into an annuity purchase contract for the remaining liability of $3.0 million. Consequently, the Company recognized a settlement charge of $6.9 million during the three and six months ended June 30, 2021, which represents the acceleration of deferred charges previously included within accumulated other comprehensive loss and the impact of remeasuring the plan assets and obligations at termination. The pension plan terminations did not require a cash outlay by the Company. As of June 30, 2021, an asset surplus of $1.3 million remained undistributed in the pension plans that were terminated.