Reynolds American Inc., Winston Salem, N.C., expects to contribute $109 million to its pension funds in 2014. The tobacco company contributed $60 million to its defined benefit plans in 2013.
Defined benefit pension fund assets were $5.2 billion as of Dec. 31, down 3.7% from a year earlier. The funding ratio rose to 92.9% at the end of 2013 from 86.2% in 2012, largely from “lower obligations due to a higher discount rate.”
The discount rate used to measure pension obligations rose 85 basis points during the year to 4.92% as of Dec. 31.
The asset allocation for the DB assets was 52.3% fixed income, 11% global equities, 11% international equities, 10.7% domestic equities, 4.4% real estate, 3.8% commodities, 3.6% hedge funds, 1.1% private equity and 2.1% other.