Washington Post 1999 Annual Report Download - page 18

issuable under outstanding stock options. Basic and diluted weighted
average share information for 1999, 1998 and 1997 is as follows:
Basic Dilutive Diluted
Weighted Effect of Weighted
Average Stock Average
Shares Options Shares
1999 ...........................10,060,578 21,206 10,081,784
1998 ...........................10,086,786 42,170 10,128,956
1997 ...........................10,699,713 33,278 10,732,991
I. PENSIONS AND OTHER POSTRETIREMENT PLANS
The Company maintains various pension and incentive savings plans
and contributes to several multi-employer plans on behalf of certain
union represented employee groups. Substantially all of the
Company’s employees are covered by these plans.
The Company also provides health care and life insurance bene-
fits to certain retired employees. These employees become eligible
for benefits after meeting age and service requirements.
The following table sets forth obligation, asset and funding infor-
mation for the Company’s defined benefit pension and postretirement
plans at January 2, 2000 and January 3, 1999 (in thousands):
Pension Plans Postretirement Benefits
1999 1998 1999 1998
Change in benefit obligation
Benefit obligation at beginning
of year ........................... $ 338,045 $ 284,278 $ 107,779 $ 101,255
Service cost ........................ 14,756 11,335 3,585 3,764
Interest cost ....................... 23,584 21,344 6,039 7,417
Amendments ....................... 3,205 4,690 2,379 —
Actuarial (gain) loss ............... (22,281) 26,871 (27,981) 155
Benefits paid ....................... (12,698) (10,473) (4,863) (4,812)
Benefit obligation at end
of year .......................... $ 344,611 $ 338,045 $ 86,938 $ 107,779
Change in plan assets
Fair value of assets at beginning
of year .......................... $ 1,308,418 $ 1,014,531 — —
Actual return on plan assets ....... (175,804) 304,360 — —
Employer contributions ............ — — $ 4,863 $ 4,812
Benefits paid ....................... (12,698) (10,473) (4,863) (4,812)
Fair value of assets at end of year ... $ 1,119,916 $ 1,308,418 $ — —
Funded status ...................... $ 775,305 $ 970,373 $ (86,938) $ (107,779)
Unrecognized transition asset ..... (22,941) (30,606) — —
Unrecognized prior service cost ... 18,930 17,835 (825) (3,366)
Unrecognized actuarial gain ....... (433,476) (701,468) (36,528) (11,433)
Net prepaid (accrued) cost ........ $ 337,818 $ 256,134 $ (124,291) $ (122,578)
The total (income) cost arising from the Company’s defined benefit
pension and postretirement plans for the years ended January 2,
2000, January 3, 1999 and December 28, 1997, consists of the
following components (in thousands):
Pension Plans Postretirement Plans
1999 1998 1997 1999 1998 1997
Service cost....... $ 14,756 $ 11,335 $ 10,567 $3,585 $ 3,764 $ 3,511
Interest cost....... 23,584 21,344 19,433 6,039 7,417 6,973
Expected return
on assets ......... (92,566) (71,814) (51,842) — — —
Amortization of
transition asset... (7,665) (7,665) (7,665) — — —
Amortization of
prior service cost.. 2,110 1,679 1,512 (162) (378) (378)
Recognized
actuarial gain .... (21,902) (16,876) (2,232) (2,886) (1,379) (1,576)
Total (benefit) cost
for the year ....... $(81,683) $ (61,997) $ (30,227) $6,576 $ 9,424 $ 8,530
The cost for the Company’s defined benefit pension and postre-
tirement plans are actuarially determined. Key assumptions utilized
at January 2, 2000, January 3, 1999 and December 28, 1997
include the following:
Pension Plans Postretirement Plans
1999 1998 1997 1999 1998 1997
Discount rate ......... 7.5% 7.0% 7.5% 7.5% 7.0% 7.5%
Expected return on
plan assets ......... 9.0% 9.0% 9.0% — — —
Rate of compensation
increase ........... 4.0% 4.0% 4.0% — — —
The assumed health care cost trend rate used in measuring the
postretirement benefit obligation at January 2, 2000 was 7.6 per-
cent for pre-age 65 benefits ( 7.1 percent for post-age 65 benefits)
decreasing to 5 percent in the year 2005 and thereafter.
Assumed health care cost trend rates have a significant effect
on the amounts reported for the health care plans. A one-percentage
point change in the assumed health care cost trend rates would have
the following effects (in thousands):
1% 1%
Increase Decrease
Benefit obligation at end of year ...... $12,944 $ (12,091)
Service cost plus interest cost .......... 1,510 (1,464)
49THE WASHINGTON POST COMPANY