Snapple 2008 Annual Report Download - page 107

Prior to the separation from Cadbury, certain employees of the Company participated in five defined benefit
plans and one postretirement health care plan sponsored by Cadbury. Effective January 1, 2008, the Company
separated these commingled plans which historically contained participants of both the Company and other
Cadbury global companies into separate single employer plans sponsored by DPS. As a result, the Company re-
measured the projected benefit obligation of the separated pension plans and recorded the assumed liabilities and
assets based on the number of participants associated with DPS. The separation of the commingled plans into stand
alone plans resulted in an increase of approximately $71 million to other non-current liabilities and a decrease of
approximately $66 million to Accumulated Other Comprehensive Income (Loss) (“AOCI”), a component of
stockholders equity.
On January 1, 2008, the Company adopted the measurement provisions of SFAS 158. SFAS 158 requires that
assumptions used to measure the Company’s annual pension and postretirement medical expenses be determined as
of the balance sheet date and all plan assets and liabilities be reported as of that date. For fiscal years ending
December 31, 2007, and prior, a majority of the Company’s pension and other postretirement plans used a
September 30 measurement date and all plan assets and obligations were generally reported as of that date. On
January 1, 2008, the Company elected the transition method under which DPS re-measured the defined benefit
pension plan assets and obligations as of January 1, 2008, the first day of the 2008 fiscal year, for plans that
previously had a measurement date other than December 31. As a result of implementing the measurement date
provisions of SFAS 158, the Company recorded a charge of less than $1 million to Retained Earnings and an
increase of approximately $2 million ($3 million gross, net of $1 million tax benefit), to AOCI.
In 2008, DPS’ Compensation Committee approved the suspension of two of the Company’s principal defined
benefit pension plans. Effective December 31, 2008, participants in the plans will not earn additional benefits for
future services or salary increases. However, current participants will be eligible for an enhanced employer
contribution within DPS’ Savings Incentive Plan effective January 1, 2009. The Company recorded a pension
curtailment gain of less than $1 million. Additionally, the Company recorded approximately $16 million in 2008
related to pension plan settlements that resulted from the organizational restructuring program initiated in the fourth
quarter of 2007.
The total pension and postretirement defined benefit costs recorded in the Company’s Statement of Operations
for the years ended December 31, 2008, 2007 and 2006 were as follows (in millions):
2008 2007 2006
For the Year Ended
December 31,
Net Periodic Benefit Costs(1)
Pension plans(2) ............................................... $31 $— $ 2
Postretirement plans............................................. 2 — —
Multi-employer plans............................................ 4 26 29
Total ...................................................... $37 $26 $31
(1) Effective January 1, 2008, the Company separated commingled pension and post retirement plans which
contained participants of both the Company and other Cadbury companies into separate stand alone plans
sponsored by DPS. The net periodic benefit costs associated with these plans for the years ended December 31,
2007 and 2006 are reflected as multi-employer plan expense in the table above.
(2) The Company recorded approximately $16 million in 2008 related to pension plan settlements that resulted
from an organizational restructuring program.
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DR PEPPER SNAPPLE GROUP, INC.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)