Seventeen companies have announced projected contributions to their defined benefit plans totaling more than $10 billion since Feb. 14, according to 10-K filings with the Securities and Exchange Commission.
This total is on top of the nearly $5 billion, combined, announced earlier this year by a dozen other U.S. corporations. Companies across the board raised the discount rate used to determine obligations, boosting their pension plans' funded status.
The following companies announced contributions since Feb. 14.
Exxon Mobil Corp., Irving, Texas, plans to contribute $1.4 billion to its U.S. defined benefit pension funds and $800 million to its non-U.S. plans in 2014, according to its 10-K filed Feb. 26.
The U.S. pension funds as of Dec. 31 had $11.2 billion in assets and $17.3 billion in liabilities, for a funded status of 64.7%, up from 63.9% a year earlier. The discount rate used to measure benefit obligations was 5% for the U.S. pension funds, up from 4% at the end of 2012.
General Electric Co., Stamford, Conn., plans to contribute a total of $1.33 billion to its pension plans in 2014, according to its 10-K filed Feb. 27.
The company plans to contribute $528 million to the GE Pension Plan. It also plans to contribute $800 million to “other pension plans” during the year. GE did not contribute to the GE Pension Plan in 2013.
As of Dec. 31, the fair-market value of its defined benefit plan assets were $59.36 billion, up 9% from the same time the year prior.
The funded status of its principal pension plans increased to 83% as of Dec. 31, from 70% a year earlier. The discount rate used for determining benefit obligations was raised to 4.85% from 3.96%.
Verizon Communications Inc., New York, will contribute about $1.2 billion to its qualified defined benefit plans and about $200 million to its non-qualified plans in 2014, according to the company's 10-K filed Feb. 27.
The company's pension obligations were $23.03 billion as of Dec. 31, and plan assets were $17.11 billion for a funding ratio of 74.3%, according to the 10-K.
Delta Air Lines Inc., Atlanta, said it plans to contribute about $925 million to its defined benefit pension funds in 2014. That amount includes $205 million of contributions above the minimum funding requirements, according to its 10-K.
Delta contributed $914 million to its pension funds in 2013.
Wurts & Associates and UBS act as outsourced CIO for Delta's frozen DB plans.
As of Dec. 31, pension fund assets totaled $8.9 billion, with a funding ratio of 46.9%, up from 38.1% a year earlier. The discount rate used to measure pension obligations rose 90 basis points from a year earlier to 5.01%.
Chevron Corp. estimates it will contribute about $700 million to its global pension funds in 2014, according to its 10-K.
The San Ramon, Calif.-based energy company contributed a total of $1.19 billion to its defined benefit plans in 2013 — $819 million to its U.S. plans and $375 million to its international plans.
The fair value of Chevron's global plan assets was $15.75 billion as on Dec. 31, according to the 10-K. The U.S. plan assets totaled $11.2 billion with $12.08 billion in liabilities, for a funded status of 92.7%, up from 72.5% at year-end 2012.
For 2013, the company used a discount rate of 4.3% for its U.S. pension funds, up from 3.6% a year earlier.
ConocoPhillips Co., Houston, expects to contribute $560 million to its worldwide defined benefit pension plans in 2014 — $350 million to U.S. plans and $210 million to international plans, according to its Feb. 25 filing.
The U.S. pension plans ended the year with $3.09 billion in assets and $3.95 billion in liabilities for a funded status of 78.2%, up from 64.5% a year earlier. The international plans ended the year with $3.13 billion in assets and $3.58 billion in liabilities for a funded status of 87.4%, up from 80.2% at the end of 2012.
The discount rate used to measure benefit obligations was 4.4% for the U.S. plans, up from 3.55% at the end of 2012.
Caterpillar Inc., Peoria, Ill., is expected to contribute $510 million to its defined benefit pension funds in 2014, according to its 10-K filed Feb. 18.
It will contribute $270 million to its non-U.S. plans and $240 million to its U.S. plans, down from $303 million and $541 million, respectively, in 2013. The plans ended the year 86% funded, up from about 70% a year earlier. Caterpillar contributed more than $1 billion total in 2012 to all plans.
Assets for the U.S. plans were $12.4 billion, with $14.42 billion in liabilities, as of Dec. 31. The non-U.S. plans had $3.95 billion in assets and $4.61 billion in liabilities. The discount rate used to measure benefit obligations was 4.6% for the U.S. plans, up from 3.7% at the end of 2012.
International Business Machines Corp., Armonk, N.Y., projects it will contribute about $600 million to its non-U.S. defined benefit and non-U.S. multiemployer pension funds in 2014, according to its 10-K.
The amount is the legally mandated minimum contribution and will be contributed mainly to defined benefit pension funds in Japan, the U.K. and Switzerland. In 2013, the company contributed $449 million to its non-U.S. pension funds and $57 million to its non-U.S. multiemployer plans, according to the filing.
As of Dec. 31, the company was not legally required to make any contributions to its U.S. pension funds. The funding ratio for IBM's U.S. pension funds increased to 105.7% in 2013, up from 94.4% at the end of 2012, according to its 10-K. It increased the discount rate assumption for its U.S.-based defined benefit plan by 90 basis points to 4.5%.
The company reported $53.9 billion in assets for its U.S. defined benefit plans as of Dec. 31, an increase of 0.6% from a year earlier.
Abbott Laboratories, Abbott Park, Ill., plans to contribute about $400 million to its post-retirement plans in 2014, of which about $300 million will go to its main domestic pension fund, according to Abbott's most recent 10-K filing.
Abbott contributed $724 million to its defined pension plans in 2013 and $379 million in 2012.
Defined benefit pension fund assets were $6.1 billion as of Dec. 31, a 23% decrease from a year earlier. However, the 2013 funding ratio increased to 95% in 2013 from 70% in 2012.
The discount rate used to measure benefit obligations rose to 4.9% in 2013, from 4.3% in 2012.
Pension fund assets and benefit obligations decreased by $3.1 billion and $4.7 billion, respectively, as a result of the separation of AbbVie Inc., the firm's research-based pharmaceuticals business. AbbVie became a separate, independent company on Jan. 1, 2013.
U.S. Steel Corp., Pittsburgh, expects to contribute up to $375 million to its pension funds through the end of 2015.
The company authorized voluntary contributions to company trusts for pensions and other benefits of up to $300 million through the end of 2015. In addition, U.S. Steel expects to make payments of $75 million to other pension funds not funded by trusts.
U.S. Steel made voluntary contributions of $140 million to its main domestic defined benefit pension fund in 2013.
Assets for pension benefits totaled $9.12 billion as of Dec. 31, with liabilities of $10.26 billion, for a funding ratio of nearly 89%. The discount rate used to measure benefit obligations was 4.5%, up from 3.75%.
Xerox Corp., Norwalk, Conn., expects to contribute about $250 million in 2014 to its defined benefit plans worldwide. Most of that contribution, $160 million, will go to non-U.S. plans. In 2013, the company made total cash contributions of $230 million, of which $203 million went to non-U.S. plans.
The discount rate used to measure pension obligations as of Dec. 31 was 4.4%, up from 3.9%.
Fair value of U.S. pension assets at year-end 2013 was $2.88 billion, with a funding ratio of 74%. At year-end 2012, the funding ratio was 71%.
Merck & Co., Whitehouse Station, N.J., plans to contribute about $250 million to its defined benefit pension funds worldwide in 2014, according to its 10-K filed Feb. 27 with the Securities and Exchange Commission.
The filing does not provide a breakdown of contributions between the U.S. and non-U.S. plans.
The defined benefit plans for U.S. and international employees had a combined $16.06 billion in benefit obligations as of Dec. 31 and a fair value of plan assets of $17.44 billion for a funding ratio of 109%.
The fair value of U.S. pension fund assets at year-end 2013 was $10 billion and the projected benefit obligation was $8.7 billion, for a funding ratio of 115%.
AK Steel Holding Corp., West Chester, Ohio, expects to contribute about $205 million to its pension funds in 2014, a 13.2% increase from contributions made during 2013, according to its most recent 10-K filing.
Defined benefit pension fund assets were $2.81 billion as of Dec. 31, up 8.5% from 2012. The funding ratio increased more than 14 percentage points in 2013, to 83.1%.
The discount rate used to measure pension obligations rose to 4.53% in 2013, from 3.85% in 2012.
American International Group Inc., New York, expects to contribute a total of $177 million to its U.S. and non-U.S. pension funds in 2014, according to its 10-K filing.
The insurance giant contributed $100 million to its defined benefit plans in 2013.
The fair value of the U.S. plan assets as of Dec. 31 was $4.02 billion, up 8.2% from the year earlier.
AIG reported the fair value of its U.S. pension plan assets at year-end 2013 was $4 billion, with a funding ratio of 82% up from 72% at year-end 2012. It raised the discount rate used to determine benefit obligations to $4.83% from 3.93%.
Whirlpool Corp., Benton Harbor, Mich., will contribute $160 million to its U.S. defined benefit pension funds in 2014, the minimum required by law, according to Whirlpool's 10-K, filed Feb. 18.
The company contributed $127 million to the U.S. plans in 2013.
As of Dec. 31, the U.S. plans had $2.8 billion in assets and $3.5 billion in projected benefit obligations, for a funding ratio of 80%.
The discount rate used for determining obligates was raised to 4.95% from 4.05%.
Xcel Energy Inc., Minneapolis, contributed $130 million its defined benefit pension funds in January. The energy company contributed $192.4 million to its pension funds in 2013, according to its most recent 10-K filing.
Defined benefit pension fund assets were $3.01 billion as of Dec. 31, up 2.4% from a year earlier. The funding ratio rose to 87.5% at the end of 2013 from 80.1% at the end of the previous year.
The discount rate used to measure pension obligations rose to 4.75% in 2013 from 4% in 2012.
Cigna Corp., Bloomfield, Conn., plans to make about $100 million in pension contributions this year, according to its 10-K filing on Feb. 27.
In 2013, Cigna contributed $195 million and also increased its fixed-income allocation, reducing its U.S. equity allocation, to reduce risk. The amount of the allocation shift was not disclosed in the filing.
The fair value of Cigna's plan assets was $4.09 billion as of Dec. 31, up 12% from a year earlier. The company's unfunded pension liability was $611 million, a decrease of about $1 billion from the year before.
