Energizer 2014 Annual Report Download - page 82

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ENERGIZER HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per share)
The following table presents pension and postretirement expense:
FOR THE YEARS ENDED SEPTEMBER 30,
Pension Postretirement
2014 2013 2012 2014 2013 2012
Service cost $ 14.4 $ 27.1 $ 26.7 $ 2.0 $ 0.4 $ 0.5
Interest cost 54.6 48.5 55.8 0.8 1.4 2.3
Expected return on plan assets (69.3)(67.4)(63.0)———
Amortization of unrecognized prior service cost 0.3 (0.2)(5.5)—(3.7)(2.6)
Recognized net actuarial loss/(gain) 18.5 28.9 20.3 (0.1)(2.0)(2.1)
Curtailment/other (gain)/loss recognized —(37.4)—
(1.1)(72.2)—
Settlement loss recognized 0.2 2.2 2.0 ———
Net periodic benefit cost $ 18.7 $ 1.7 $ 36.3 $ 1.6 $(76.1)$ (1.9)
Amounts expected to be amortized from accumulated other comprehensive loss into net period benefit cost during the year
ending September 30, 2015, are as follows:
Pension Postretirement
Net actuarial (loss)/gain $ (9.9) $ 0.9
Prior service (cost)/credit $ (0.3) $ 0.1
Effective January 1, 2014, benefits under the U.S. pension plan were frozen and future service benefits are no longer being
accrued. As a result, the amortization period for unrecognized gains and losses was changed for fiscal 2015 and beyond from
the average remaining service period of active employees to the average remaining life expectancy of all plan participants.
Because unrecognized losses currently exist, this change will result in a decrease in future pension expense due to the longer
amortization period being applied.
The following table presents assumptions, which reflect weighted-averages for the component plans, used in determining the
above information:
September 30,
Pension Postretirement
2014 2013 2014 2013
Plan obligations:
Discount rate 3.7% 4.3% 3.7% 4.9%
Compensation increase rate 3.0% 2.5% N/A N/A
Net periodic benefit cost:
Discount rate 4.3% 3.6% 4.9% 3.9%
Expected long-term rate of return on plan assets 7.3% 7.3% N/A 3.0%
Compensation increase rate 3.1% 2.5% N/A N/A
The expected return on plan assets was determined based on historical and expected future returns of the various asset classes,
using the target allocations described above. Specifically, for the U.S., which constitutes over 80% of our total assets, the
expected return on equities is approximately 8.4%, and the expected return on debt securities (including government and
corporate bonds) is approximately 3.5%.
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