Arconic to Freeze Pension Plans for U.S.-Based Salaried and Non-Bargained Hourly Employees
January 08 2018 - 8:15AM
Business Wire
Arconic Inc. (NYSE:ARNC) announced today that it will freeze
U.S. defined benefit pension plans for all U.S.-based salaried and
non-bargained hourly employees, effective April 1, 2018.
As a result, in the first quarter of 2018, the Company expects
to record a liability decrease of approximately $140 million
related to the reduction of future benefits and a curtailment
charge of approximately $5 million pre-tax. For the full year 2018,
the Company expects pension-related expense to be lower by
approximately $50 million pre-tax compared to 2017 full-year
expenses.
The pension freeze applies to the accrual of future benefits for
approximately 7,900 affected U.S. employees; benefits already
earned by these employees through March 31, 2018 will be available
when they reach retirement eligibility. Retirees already collecting
benefits and former employees with vested benefits under the
pension plans will not be impacted by this change.
Arconic will continue to support affected employees in preparing
for a financially sound retirement by contributing 3% of their
eligible compensation to the Company’s applicable 401(k) plan and
by matching their contributions of up to 6% of eligible
compensation to the applicable plan—consistent with what most new
salaried employees currently receive. Arconic is also providing an
additional transition contribution of 3% of eligible compensation
for the remaining nine months of 2018 for affected employees.
“This transition balances our need to deliver competitive,
equitable benefits to all employees while maintaining market
competitiveness,” said Vas Nair, Executive Vice President of Human
Resources at Arconic.
The lower pension expense expectation is based on preliminary
year-end December 31, 2017 results and is inclusive of the change
to the pension plans described above as well as expected changes in
other pension-related assumptions.
About Arconic
Arconic (NYSE: ARNC) creates breakthrough products that shape
industries. Working in close partnership with our customers, we
solve complex engineering challenges to transform the way we fly,
drive, build and power. Through the ingenuity of our people and
cutting-edge advanced manufacturing techniques, we deliver these
products at a quality and efficiency that ensure customer success
and shareholder value. For more information: www.arconic.com.
Follow @arconic: Twitter, Instagram, Facebook, LinkedIn and
YouTube.
Dissemination of Company Information
Arconic intends to make future announcements regarding Company
developments and financial performance through its website on
www.arconic.com.
Forward–Looking Statements
This release contains statements that relate to future events
and expectations and as such constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements include those containing such
words as "anticipates," "believes," "could," "estimates,"
"expects," "forecasts," "goal," "guidance," "intends," "may,"
"outlook," "plans," "projects," "seeks," "sees," "should,"
"targets," "will," "would," or other words of similar meaning. All
statements that reflect Arconic’s expectations, assumptions or
projections about the future, other than statements of historical
fact, are forward-looking statements, including, without
limitation, statements and guidance regarding future financial
results or operating performance, and expectations regarding the
transaction closing. These statements reflect beliefs and
assumptions that are based on Arconic’s perception of historical
trends, current conditions and expected future developments, as
well as other factors management believes are appropriate in the
circumstances. Forward-looking statements are not guarantees of
future performance and are subject to risks, uncertainties, and
changes in circumstances that are difficult to predict. Although
Arconic believes that the expectations reflected in any
forward-looking statements are based on reasonable assumptions, it
can give no assurance that these expectations will be attained and
it is possible that actual results may differ materially from those
indicated by these forward-looking statements due to a variety of
risks and uncertainties. Such risks and uncertainties include, but
are not limited to: (a) deterioration in global economic and
financial market conditions generally; (b) unfavorable changes in
the markets served by Arconic; (c) the inability to achieve the
level of revenue growth, cash generation, cost savings, improvement
in profitability and margins, fiscal discipline, or strengthening
of competitiveness and operations anticipated or targeted; (d)
changes in discount rates or investment returns on pension assets;
(e) Arconic’s inability to realize expected benefits, in each case
as planned and by targeted completion dates, from acquisitions,
divestitures, facility closures, curtailments, expansions, or joint
ventures; (f) the impact of cyber attacks and potential information
technology or data security breaches; (g) any manufacturing
difficulties or other issues that impact product performance,
quality or safety; (h) political, economic, and regulatory risks in
the countries in which Arconic operates or sells products; (i)
material adverse changes in aluminum industry conditions, including
fluctuations in London Metal Exchange-based aluminum prices; (j)
the impact of changes in foreign currency exchange rates on costs
and results; (k) the outcome of contingencies, including legal
proceedings, government or regulatory investigations, and
environmental remediation, which can expose Arconic to substantial
costs and liabilities; and (l) the other risk factors summarized in
Arconic’s Form 10-K for the year ended December 31, 2016, Arconic’s
Form 10-Q for the quarter ended June 30, 2017 and other reports
filed with the U.S. Securities and Exchange Commission (SEC).
Arconic disclaims any intention or obligation to update publicly
any forward-looking statements, whether in response to new
information, future events, or otherwise, except as required by
applicable law. Market projections are subject to the risks
discussed above and other risks in the market.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20180108006073/en/
Arconic Inc.Investor:Patricia Figueroa, (212)
836-2758Patricia.Figueroa@arconic.comorMedia:Christa Zipf,
(212) 836-2605Christa.Zipf@arconic.com
Arconic (NYSE:ARNC)
Historical Stock Chart
From Mar 2024 to Apr 2024
Arconic (NYSE:ARNC)
Historical Stock Chart
From Apr 2023 to Apr 2024