Tuesday, February 28, 2012

Report: Main retirement plan's value sank in '11

The main Gannett retirement plan benefiting the vast majority of employees and retirees lost ground last year, after asset values fell and projected obligations rose, according to the annual 10-K report to U.S. securities regulators filed last week.

The report says the value of the Gannett Retirement Plan's portfolio of stocks and other investments dipped to $1.78 billion as of Dec. 25, while projected obligations rose slightly, to $2.33 billion.

That meant the GRP's funded status sank to 76% from 85% in December 2010. (See table, below.) Still, that was in line with the 74% average for typical corporate pension plans, BNY Mellon Asset Management said in a report this month.

The company's contributions during the year weren't enough to make up the difference. Gannett contributed just $33 million during 2011 vs. $130 million in 2010.

To be sure, the company pumped in more early this year -- $54 million -- and expects to add up to another $64 million by the end of the year, according to the report.

The GRP was frozen for substantially all employees in 2008 as the company raced to cut costs during the industry-wide plunge in advertising revenue. Nonetheless, it remains the biggest of four company-sponsored plans benefiting more than 30,000 current employees and thousands more who have already retired.

For details on the other three plans, see note No. 8 on the retirement plans, starting on Page 63 of the 10-K.

Protected -- to a point
Private pension plans like Gannett's are protected by a U.S. agency, the Pension Benefit Guaranty Corp. But there are limits to that protection. Learn more with this FAQ.

This table shows GRP data for the past four years; (bigger view). Note: Dollar amounts are in thousands:


  1. This is very helpful, Jim. Thanks.

  2. Unless you're getting a minimal payout, the PBGC won't make you "whole". The bigger your pension, the less (as a percentage) it guarantees.

    Check any number of stories about airline employees and pensions of auto-related companies that went belly-up. Much as your 401k became a "201k" during the crash (or a .501k if you never got out of Gannett stock), pensions were also cut in half.

    The government will not save you. Save yourself.

  3. In other words, don't ever trust Gannett or any other major corporation. We are pawns.

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Jim says: "Proceed with caution; this is a free-for-all comment zone. I try to correct or clarify incorrect information. But I can't catch everything. Please keep your posts focused on Gannett and media-related subjects. Note that I occasionally review comments in advance, to reject inappropriate ones. And I ignore hostile posters, and recommend you do, too."

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