United Parcel Service Inc., Atlanta, plans to make a $1 billion accelerated contribution to its defined benefit plans in the fourth quarter.
The company announced the contribution at its investor conference on Thursday.
UPS Chief Financial Officer Kurt Kuehn said the contribution will allow the company “to avoid more than $50 million in PBGC premiums over the next couple of years” and reduce pension expense and future contribution requirements.
As recently as last week’s 10-Q filing with the Securities and Exchange Commission, the company said its intention was to contribute $49 million to the plans in the fourth quarter.
In the first three quarters of 2014, UPS contributed a total of $71 million to the plans.
As of Dec. 31, UPS’ U.S. defined benefit plan had $26.2 billion in assets and $29.5 billion in projected benefit obligations, for a funding ratio of 88.8%, according to the company’s 10-K filing.
Mr. Kuehn’s statements were forwarded by UPS spokesman Andrew McGowan.