Albertsons 2006 Annual Report Download - page 82

Download and view the complete annual report

Please find page 82 of the 2006 Albertsons annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 85

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85

SUPERVALU INC. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
discount rate to be used by the company. Prior to using the yield curve approach, the discount rate assumptions
were based on investment yields of Aa rated long-term corporate bonds on the date of determination. The
discount rate as of the November 30, 2005 measurement date was 5.75%, compared to 6.00% as of
November 30, 2004.
The company expects to contribute approximately $26.0 million to its non-union defined benefit pension
plans during fiscal 2007.
The following table summarizes the estimated future benefit payments, which reflect expected future service
as appropriate, that are expected to be paid:
Pension Benefits
Post Retirement
Benefits
(In thousands)
Fiscal Year
2007 $ 26,530 $ 9,900
2008 26,530 10,400
2009 28,730 10,900
2010 31,230 11,300
2011 34,130 11,700
2012-2016 221,850 65,300
The pension benefits also reflect the estimated future benefit payments for the non-contributory, unfunded
pension plans sponsored by the company.
Employer contributions under the defined contribution 401(k) and profit sharing plans are determined by
plan provisions or at the discretion of the company’s Retirement Committee and were $16.3 million, $18.3
million and $17.1 million for fiscal 2006, 2005 and 2004, respectively. Under the defined contribution 401(k)
plan, employees have the option of contributing between 2 percent and 15 percent of pretax earnings. Plan assets
also include 2.8 and 3.0 million shares of the company’s common stock at February 25, 2006 and February 26,
2005, respectively.
The company also participates in several multi-employer plans providing defined benefits to union
employees under the provisions of collective bargaining agreements. These plans require the company to make
contributions thereto as negotiated in such collective bargaining agreements. The company incurred expense
related to the union pension plans of $37.0 million, $37.0 million and $34.2 million for fiscal 2006, 2005 and
2004, respectively. Currently, some of these plans are underfunded in that the present value of accrued liabilities
exceeds the current value of the assets held in trust to pay benefits. If the company were to exit certain markets or
otherwise cease making contributions to these plans at this time, it could trigger a withdrawal liability that would
require the company to fund its proportionate share of a plan’s unfunded vested benefits. There are many
variables that affect future funding requirements such as investment returns and benefit levels.
SHAREHOLDER RIGHTS PLAN
On April 24, 2000, the company announced that the Board of Directors adopted a Shareholder Rights Plan
under which one preferred stock purchase right is distributed for each outstanding share of common stock. The
F-37