XML 332 R26.htm IDEA: XBRL DOCUMENT v3.24.0.1
Pension and other postretirement benefits
 12 Months Ended
Dec. 31, 2023
Retirement Benefits [Abstract]  
Pension and other postretirement benefits Pension and other postretirement benefits
We have a number of defined benefit pension and postretirement plans covering eligible U.S. and non-U.S. employees. The defined benefit pension plans are noncontributory. The benefits under these plans are based primarily on years of service and employees’ pay near retirement. Our funding policy for U.S. plans is to contribute annually, at a minimum, amounts required by applicable laws and regulations. Obligations under non-U.S. plans are systematically provided for by depositing funds with trustees or by book reserves. As of December 31, 2023, no further benefits are being accrued under the U.S. defined benefit pension plans and the other postretirement benefit plans, other than certain postretirement benefit plans covering employees subject to a collective bargaining agreement.
In May 2023, our Board of Directors approved the termination of the Teleflex Incorporated Retirement Income Plan (the “TRIP”), a U.S. defined benefit plan, effective as of August 1, 2023. The TRIP is subject to the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and is intended to be tax-qualified under Section 401(a) of the Code. Participation in and accrual of benefits under the TRIP have been frozen since 2012, and, as of December 31, 2023, the TRIP assets exceeded the liabilities. In June 2023, we notified participants of our intent to terminate the TRIP and requested a determination letter from the Internal Revenue Services (“IRS”) stating that the TRIP satisfies the requirements, in form, to be tax-qualified under Code Section 401(a) upon termination. In September 2023, a notice of benefits was sent to participants, beneficiaries and alternate payees in connection with the proposed termination. Participants, beneficiaries and alternate payees who had not started their TRIP benefits were offered the opportunity to elect to receive their benefits in the form of a lump sum distribution in connection with the termination of the TRIP or to commence their benefits in the form of monthly annuity payments in accordance with TRIP terms. Because the TRIP is an ERISA plan, the termination is subject to approval by the Pension Benefit Guaranty Corporation (“PBGC”). In September 2023, we filed a termination notice with the PBGC for approval. After the termination has been approved by the PBGC, one or more annuity contracts with a qualifying insurer(s) will be purchased to provide TRIP benefits that have not already been distributed. While we expect to proceed with the termination, we may decide not to proceed for certain reasons including, for example, if the cost to terminate the TRIP exceeds our current expectations. Should the Company proceed with the termination, participants, beneficiaries, and alternate payees will each receive the full value of their benefit under the TRIP, paid either from TRIP assets or from an annuity contract purchase as described under this paragraph.
Upon settlement of the TRIP, we are required to remeasure the plan assets and obligation and will recognize a settlement loss for the recognition of the unrecognized losses in accumulated other comprehensive income including the effects of the remeasurement. In December 2023, we recognized a settlement charge of $45.2 million resulting from payments to eligible participants who elected the lump sum distribution option. As of December 31, 2023, the pre-tax accumulated other comprehensive loss related to the TRIP was approximately $150.5 million.
Teleflex and certain of our subsidiaries provide medical, dental and life insurance benefits to pensioners or their survivors. The associated plans are unfunded and approved claims are paid from our funds.
The following table provides information regarding the components of the net benefit (income) expense of the pension and postretirement benefit plans for the years ended December 31, 2023, 2022 and 2021:
PensionOther Benefits
202320222021202320222021
Service cost$1,435 $1,346 $1,467 $— $— $— 
Interest cost17,297 10,776 9,272 824 477 418 
Expected return on plan assets(25,277)(25,776)(30,726)— — — 
Net amortization and deferral8,536 7,900 8,589 (1,564)(1,258)(1,058)
Settlements45,244 — — — — — 
Net benefit expense (income)
$47,235 $(5,754)$(11,398)$(740)$(781)$(640)
Net benefit expense (income) is primarily included in selling, general and administrative expenses within the consolidated statements of income.
The following table provides the weighted average assumptions for U.S. and foreign plans used in determining net benefit cost:
PensionOther Benefits
202320222021202320222021
Discount rate5.1 %2.8 %2.5 %5.1 %2.7 %2.3 %
Rate of return7.3 %5.6 %6.7 %
Initial healthcare trend rate6.1 %6.4 %6.8 %
Ultimate healthcare trend rate4.5 %4.5 %4.5 %
The following table provides summarized information with respect to the pension and postretirement benefit plans, measured as of December 31, 2023 and 2022:
PensionOther Benefits
2023202220232022
Benefit obligation, beginning of year$356,757 $474,674 $18,620 $26,804 
Service cost1,435 1,346 — — 
Interest cost17,297 10,776 824 477 
Actuarial loss (gain)
11,557 (104,558)(508)(6,223)
Currency translation1,067 (3,030)— — 
Benefits paid(21,208)(21,472)(1,910)(2,491)
Liability gain due to settlement(15,272)— — — 
Medicare Part D reimbursement— — (3)53 
Plan amendments— — (7,488)— 
Settlements(73,932)— — — 
Administrative costs(2,304)(979)— — 
Projected benefit obligation, end of year275,397 356,757 9,535 18,620 
Fair value of plan assets, beginning of year357,270 469,793 
Actual return on plan assets23,740 (89,506)
Contributions1,276 1,464 
Benefits paid(95,139)(21,472)
Administrative costs(2,304)(979)
Currency translation670 (2,030)
Fair value of plan assets, end of year285,513 357,270 
Funded status, end of year$10,116 $513 $(9,535)$(18,620)

The actuarial loss for pension for the year ended December 31, 2023 was primarily due to a decrease in the discount rate used to measure the obligation, offset by demographic gains. The actuarial gain for pension for the
year ended December 31, 2022 was primarily due to an increase in the discount rate used to measure the obligation.
The accumulated benefit obligations (ABO) and the projected benefit obligations (PBO) for plans with ABO and PBO in excess of plan assets were $262.6 million and $263.2 million, respectively, at December 31, 2023 and $345.5 million and $346.0 million respectively, at December 31, 2022. The fair value of plan assets for plans with PBO and ABO in excess of plan assets were $272.3 million and $345.7 million, respectively, at December 31, 2023 and December 31, 2022, respectively.
The following table sets forth the amounts recognized in the consolidated balance sheet with respect to the pension and postretirement plans:
PensionOther Benefits
2023202220232022
Other assets$27,370 $16,870 $— $— 
Payroll and benefit-related liabilities(1,439)(1,408)(1,361)(2,175)
Pension and postretirement benefit liabilities(15,815)(14,949)(8,174)(16,445)
Accumulated other comprehensive loss (gain)164,139 219,555 (14,244)(7,812)
$174,255 $220,068 $(23,779)$(26,432)
The following tables set forth the amounts recognized in accumulated other comprehensive income with respect to the plans:
Pension
Prior Service
Cost
Net Loss or (Gain)
Deferred
Taxes
Accumulated Other Comprehensive
Loss, Net of Tax
Balance at December 31, 2021$200 $217,939 $(77,273)$140,866 
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral— (7,900)1,832 (6,068)
Amounts arising during the period:
Actuarial changes in benefit obligation— 10,724 (2,271)8,453 
Impact of currency translation— (1,408)365 (1,043)
Balance at December 31, 2022200 219,355 (77,347)142,208 
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral(9)(8,527)1,961 (6,575)
Amounts arising during the period:
Actuarial changes in benefit obligation— (47,453)10,805 (36,648)
Impact of currency translation— 573 (139)434 
Balance at December 31, 2023$191 $163,948 $(64,720)$99,419 
 
Other Benefits
Prior Service
Cost
Net (Gain) or
Loss
Deferred
Taxes
Accumulated Other Comprehensive
Loss, Net of Tax
Balance at December 31, 2021$(3,652)$805 $271 $(2,576)
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral1,017 241 (287)971 
Amounts arising during the period:
Actuarial changes in benefit obligation— (6,223)1,419 (4,804)
Balance at December 31, 2022(2,635)(5,177)1,403 (6,409)
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral1,017 547 (359)1,205 
Amounts arising during the period:
Actuarial changes in benefit obligation— (7,996)1,830 (6,166)
Balance at December 31, 2023$(1,618)$(12,626)$2,874 $(11,370)
The following table provides the weighted average assumptions for U.S. and foreign plans used in determining benefit obligations:
PensionOther Benefits
2023202220232022
Discount rate4.7 %5.1 %5.0 %5.1 %
Rate of compensation increase3.0 %3.0 %
Initial healthcare trend rate6.6 %5.9 %
Ultimate healthcare trend rate4.5 %4.5 %
The discount rate represents the interest rate used to determine the present value of future cash flows currently expected to be required to settle the pension and other benefit obligations. The weighted average discount rates for U.S. pension plans and other benefit plans of 4.81% and 4.97%, respectively, were established by comparing the projection of expected benefit payments to the AA Above Median yield curve as of December 31, 2023. The expected benefit payments are discounted by each corresponding discount rate on the yield curve. For payments beyond 30 years, we extend the curve assuming that the discount rate derived in year 30 is extended to the end of the plan’s payment expectations. Once the present value of the string of benefit payments is established, we determine the single rate on the yield curve that, when applied to all obligations of the plan, will exactly match the previously determined present value.
As part of the evaluation of pension and other postretirement assumptions, we applied assumptions for mortality and healthcare cost trends that incorporate generational white and blue collar mortality trends. In determining its benefit obligations, we used generational tables that take into consideration increases in plan participant longevity.
Our assumption for the expected return on plan assets is primarily based on the determination of an expected return for its current portfolio. This determination is made using assumptions for return and volatility of the portfolio. Asset class assumptions are set using a combination of empirical and forward-looking analysis. To the extent historical results have been affected by unsustainable trends or events, the effects of those trends are quantified and removed. We apply a variety of models for filtering historical data and isolating the fundamental characteristics of asset classes. These models provide empirical return estimates for each asset class, which are then reviewed and combined with a qualitative assessment of long term relationships between asset classes before a return estimate is finalized. The qualitative analysis is intended to provide an additional means for addressing the effect of unrealistic or unsustainable short-term valuations or trends, resulting in return levels and behavior we believe are more likely to prevail over long periods. Effective in 2023, we changed the expected return on plan assets of the U.S. pension plans from 7.40% to 4.81% due to modifications to the investment strategy in order to reflect expected return assumptions based on recent capital market movements.
The accumulated benefit obligation for all U.S. and foreign defined benefit pension plans was $274.9 million and $356.3 million for 2023 and 2022, respectively. All of the pension plans had accumulated benefit obligations in excess of their respective plan assets as of December 31, 2023 and 2022, with the exception of one foreign plan that had plan assets of $1.0 million and $0.8 million in excess of the accumulated benefit obligation as of December 31, 2023 and 2022, respectively.
Our investment objective is to achieve an enhanced long-term rate of return on plan assets, subject to a prudent level of portfolio risk, for the purpose of enhancing the availability of benefits for participants. These investments are comprised of fixed income mutual funds. Our target allocation percentage is 100% fixed-income securities. Fixed-income funds are held for diversification relative to equities and as a partial hedge of interest rate risk with respect to plan liabilities. The plans may also hold cash to meet liquidity requirements. Actual performance may not be consistent with the respective investment strategies. Investment risks and returns are measured and monitored on an ongoing basis through annual liability measurements and investment portfolio reviews to determine whether the asset allocation targets continue to represent an appropriate balance of expected risk and reward.
The following table provides the fair values of the pension plan assets at December 31, 2023 by asset category:
Fair Value Measurements
Asset Category (a)Total
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Cash$909 $909 $— $— 
Money market funds4,424 4,424 — — 
Fixed income securities:
Intermediate duration fund (e)193,674 193,674 — — 
Long duration bond fund (f)1,357 1,357 — — 
Corporate, government and foreign bonds72,037 — 72,037 — 
Absolute return credit fund (i)317 — 317 — 
Other types of investments:
Contract with insurance company (k)12,795 — — 12,795 
Total investments at fair value$285,513 $200,364 $72,354 $12,795 
Total$285,513 
The following table provides the fair values of the pension plan assets at December 31, 2022 by asset category:
 Fair Value Measurements
Asset Category (a)Total
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Cash$769 $769 $— $— 
Money market funds13 13 — — 
Equity securities:
Managed volatility (b)46,721 46,721 — — 
U.S. small/mid-cap equity (c)6,054 6,054 — — 
World equity (excluding U.S.) (d)28,159 28,159 — — 
Fixed income securities:
Intermediate duration fund (e)105,865 105,865 — — 
Long duration bond fund (f)87,018 87,018 — — 
Corporate bond fund (g)6,092 6,092 — — 
Emerging markets debt fund (h)6,284 6,284 — — 
Corporate, government and foreign bonds58,572 — 58,572 — 
Absolute return credit fund (i)427 — 427 — 
Asset backed – home loans153 — 153 — 
Other types of investments:
Structured credit (j)
29 29 — 
Contract with insurance company (k)11,114 — — 11,114 
Total investments at fair value$357,270 $287,004 $59,152 $11,114 
Total$357,270 
(a)Information on asset categories described in notes (b)-(l) is derived from prospectuses and other material provided by the respective funds comprising the respective asset categories.
(b)This category comprises mutual funds that invest in securities of U.S. and non-U.S. companies of all capitalization ranges that exhibit relatively low volatility.
(c)This category comprises a mutual fund that invests at least 80% of its net assets in equity securities of small and mid-sized companies. The fund invests in common stocks or exchange traded funds holding common stock of U.S. companies with market capitalizations in the range of companies in the Russell 2500 Index.
(d)This category comprises a mutual fund that invests at least 80% of its net assets in equity securities of foreign companies. These securities may include common stocks, preferred stocks, warrants, exchange traded funds based on an international equity index, derivative instruments whose value is based on an international equity index and derivative instruments whose value is based on an underlying equity security or a basket of equity securities. The fund invests in securities of foreign issuers located in developed and emerging market countries. However, the fund will not invest more than 35% of its assets in the common stocks or other equity securities of issuers located in emerging market countries.
(e)This category comprises a mutual fund that invests in instruments or derivatives having economic characteristics similar to fixed income securities. The fund invests in investment grade fixed income instruments, including U.S. and foreign corporate obligations, fixed income securities issued by sovereigns or agencies in both developed and emerging foreign markets, debt obligations issued by governments or other municipalities, and securities issued or guaranteed by the U.S. Government and its agencies. The fund will seek to maintain an effective average duration between three and ten years, and uses derivative instruments, including interest rate swap agreements and credit default swaps, for the purpose of managing the overall duration and yield curve exposure of the Fund’s portfolio of fixed income securities.
(f)This category comprises a mutual fund that invests in instruments or derivatives having economic characteristics similar to fixed income securities. The fund invests in investment grade fixed income instruments, including securities issued or guaranteed by the U.S. Government and its agencies and instrumentalities, corporate bonds, asset-backed securities, exchange traded funds, mortgage-backed securities and collateralized mortgage-backed securities. The fund invests primarily in long duration government and corporate fixed income securities, and uses derivative instruments, including interest rate swap agreements and Treasury futures contracts, for the purpose of managing the overall duration and yield curve exposure of the Fund’s portfolio of fixed income securities.
(g)This category comprises funds that invest primarily in higher-yielding fixed income securities, including corporate bonds and debentures, convertible and preferred securities and zero coupon obligations.
(h)This category comprises a mutual fund that invests at least 80% of its net assets in fixed income securities of emerging market issuers, primarily in U.S. dollar-denominated debt of foreign governments, government-related and corporate issuers in emerging market countries and entities organized to restructure the debt of those issuers.
(i)This category comprises a mutual fund that invests primarily in investment grade bonds and similar fixed income and floating rate securities.
(j)This category comprises a fund that invests primarily in collateralized debt obligations and other structured credit vehicles and may include fixed income securities, loan participations, credit-linked notes, medium-term notes, pooled investment vehicles and derivative instruments.
(k)This category comprises the asset established out of an agreement to purchase a bulk-annuity policy from an insurer to fully cover the liabilities for members of the pension plan. The asset value is based on the fair value of the contract as determined by the insurance company using inputs that are not observable.
Our contributions to U.S. and foreign pension plans during 2024 are expected to be approximately $1.4 million. Contributions to postretirement healthcare plans during 2024 are expected to be approximately $1.4 million.
The following table provides information about the expected benefit payments under its U.S. and foreign plans for each of the five succeeding years and the aggregate of the five years thereafter:
PensionOther Benefits
2024$23,044 $1,360 
202521,870 1,346 
202621,751 990 
202721,346 728 
202821,066 673 
Years 2029 — 203399,009 2,761 
We maintain a number of defined contribution savings plans covering eligible U.S. and non-U.S. employees. We partially match employee contributions. Costs related to these plans were $26.1 million, $24.3 million and $23.2 million for 2023, 2022 and 2021, respectively.