Verizon Communications Inc. announced Tuesday it would make the minimum contribution requirement of approximately $600 million for its pension plans in 2017.
Last year, Verizon contributed $800 million to its six pension plans, all based in the U.S., Robert Varettoni, a company spokesman, wrote in an email.
“Our reported fourth-quarter earnings include a non-cash pretax gain of about $1.6 billion,” Chief Financial Officer Matthew Ellis told securities analysts Tuesday, according to a transcript of the earnings call. “The largest item was the mark-to-market adjustment of our pension and (other post-employment benefits) liabilities, which (represents) a pretax gain of roughly $1.8 billion. This adjustment, which was primarily non-cash, was caused by an increase in the discount rate as well as other plan factors.”
Mr. Ellis didn’t disclose the new discount rate, and Mr. Varettoni said the discount rate will be published in the company’s 10-K filing with the Securities and Exchange Commission. The previous discount rate was 4.6%, Mr. Varettoni added.
Verizon had $15.47 billion in defined benefit assets as of Sept. 30, according to Pensions & Investments data, with an asset allocation of 39.2% domestic fixed income, 17.4% private equity, 16.1% domestic equity, 8.8% real estate, 8.5% other alternatives, 8.2% international equity and 1.9% global/international fixed income.
