Annual report pursuant to Section 13 and 15(d)

RETIREMENT PLANS AND RELATED POST RETIREMENT BENEFITS

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RETIREMENT PLANS AND RELATED POST RETIREMENT BENEFITS
 12 Months Ended
Dec. 31, 2023
Retirement Benefits [Abstract]  
RETIREMENT PLANS AND RELATED POST RETIREMENT BENEFITS RETIREMENT PLANS AND RELATED POST RETIREMENT BENEFITS
The Company has two non-qualified supplemental retirement defined benefit plans (“SERP” and “SERP II”) for certain current and retired executive officers. The accumulated benefit obligation of the plans as of December 31, 2023 and 2022 amounts to $22.0 million and $20.5 million, respectively.
The plans provide for benefits based upon average annual compensation and years of service and, in the case of SERP, there are offsets for social security and profit sharing benefits. It is the Company’s intent to fund the plans as plan benefits become payable, since no assets exist at December 31, 2023 or 2022 for either of the plans.
The Company accounts for the funded status (i.e., the difference between the fair value of plan assets and the projected benefit obligations) of its pension plans in accordance with the recognition and disclosure provisions of ASC Topic 715, Compensation, Retirement Benefits, which requires the Company to recognize the funded status in its balance sheet, with a corresponding adjustment to Accumulated Other Comprehensive Income (“AOCI”), net of tax. These amounts will be subsequently recognized as net periodic pension cost pursuant to the Company’s historical policy for amortizing such amounts. Further, actuarial gains and losses that arise in subsequent periods and are not recognized as net periodic pension cost in the
same periods will be recognized as a component of AOCI. Those amounts will be subsequently recognized as a component of net periodic pension cost on the same basis as the amounts recognized in AOCI.
Unrecognized prior service costs of $0.6 million ($1.2 million net of $0.6 million in taxes) and unrecognized actuarial losses of $2.0 million ($3.6 million net of $1.6 million in taxes) are included in AOCI at December 31, 2023 and have not yet been recognized in net periodic pension cost.
The reconciliation of the beginning and ending balances of the projected benefit obligation of the plans for the years ended December 31 is as follows:
(In thousands) 2023 2022
Funded Status
Projected Benefit Obligation
Beginning of the Year — January 1 $ 26,210  $ 30,503 
Service Cost 105  138 
Interest Cost 1,302  834 
Actuarial Loss (Gain) 1,529  (4,917)
Benefits Paid (348) (348)
End of the Year — December 31 $ 28,798  $ 26,210 
In 2023, the net actuarial loss of $1.5 million is due to the change in the salary scale and the decrease of 21 basis points in the discount rate used to measure the benefit obligation as of December 31, 2023 compared to the prior year. The assumptions used to calculate the projected benefit obligation as of December 31 are as follows:
2023 2022
Discount Rate 4.79% 5.00%
Future Average Compensation Increases 3.00%
2.00% - 3.00%
The plans are unfunded at December 31, 2023 and are recognized in the accompanying Consolidated Balance Sheets as a current accrued pension liability of $0.3 million and a long-term accrued pension liability of $28.4 million.
The service cost component of net periodic benefit cost is included in SG&A expenses, and all other net periodic benefit costs components (such as interest cost, prior service cost amortization and actuarial gain/loss amortization) are reported outside of operating income, within Other (Income) Expense, Net in the accompanying Consolidated Statements of Operations.
The following table summarizes the components of the net periodic cost for the years ended December 31:
(In thousands) 2023 2022 2021
Net Periodic Cost
Service Cost — Benefits Earned During Period $ 105  $ 138  $ 195 
Interest Cost 1,302  834  764 
Amortization of Prior Service Cost 386  386  386 
Amortization of Losses 358  949  1,292 
Net Periodic Cost $ 2,151  $ 2,307  $ 2,637 
The assumptions used to determine the net periodic cost are as follows:
2023 2022 2021
Discount Rate 5.00% 2.75% 2.42%
Future Average Compensation Increases
2.00% - 3.00%
2.00% - 3.00%
2.00% - 3.00%
Benefit payments expected in each of the next five years are as follows: 2024 - $0.7 million, 2025 - $0.6 million, 2026 - $0.6 million, 2027 - $0.9 million, and 2028 - $1.9 million. Benefits expected to be paid in the aggregate between 2029 and 2033 are $11.1 million. Given that the plans are unfunded, these amounts are what the Company expects to contribute to the plans in each respective year.
Participants in the SERP are entitled to paid medical, dental and long-term care insurance benefits upon retirement under the plan. The measurement date for determining the plan obligation and cost is December 31. The accumulated postretirement benefit obligation is $0.8 million at December 31, 2023 and 2022. The plan is recognized in the accompanying Consolidated Balance Sheets as a current accrued pension liability of less than $0.1 million and a long-term accrued pension liability of $0.8 million. The net periodic cost for the years ended December 31, 2023, 2022 and 2021 was not material.
The Company is a participating employer in a trustee-managed multiemployer defined benefit pension plan for employees who participate in collective bargaining agreements. The plan generally provides retirement benefits to employees based on years of service to the Company. Contributions are based on the hours worked and are expensed on a current basis. The plan is 99.2% funded as of January 1, 2023. The Company’s contributions to the plan were $0.7 million in 2023, $0.5 million in 2022 and $0.4 million in 2021. These contributions represent less than 1% of total contributions to the plan.