Peoples Energy, Chicago, will lower its 2004 expected rate of return on pension plan assets to 8.75% from 9% and expects a 2004 net pension expense of $11 million to $13 million, the company announced. The increased expense is expected to contribute to lower fiscal 2004 earnings of between $2.70 and $2.85 a share, down from expected fiscal 2003 earnings of $2.85 to $2.95 a share, the company announced. The company anticipates pension income of $1 million to $2 million for 2003; final 2003 earnings will be announced Oct. 31.
The Peoples Energy pension plans had $485 million in assets and $410 million in liabilities, according to the company's 2002 annual report. The company expects to make no cash contribution to the pension plans for 2003 or 2004.