Firms Make Last-Minute Dash for Pension Contributions in Q3

Companies bolster pensions while taking advantage of lower tax rate.

 Scores of companies looking to take advantage of expiring tax breaks bolstered their pensions with fat discretionary contributions in the third quarter, with at least 10 companies kicking in a minimum of $100 million, including three that each gave $1 billion or more, according to SEC filings. 

The 2017 plan year is the last chance for companies to maximize their pension plan’s tax deduction before the lower corporate tax rate comes into effect. And for most US corporate plans, the final deadline for plan sponsors to make contributions for the fiscal year was during their fiscal third quarter, which saw significant pension contribution activity.

Contributing at least $1 billion to their pensions during the quarter were Aerospace and defense companies Lockheed Martin and Raytheon, which gave $1.5 billion and $1.25 billion, respectively, and construction machinery and equipment giant Caterpillar Inc., which contributed $1 billion.

The next tier of pension contributions was led by automobile manufacturer Fiat Chrysler Automobiles, which made a discretionary pension contribution of €594 million ($675.4 million) during the third quarter, followed by communications provider CenturyLink Inc., and timber company Weyerhaeuser Co., which added $400 million and $300 million, respectively, to their pensions.

Defense contractors General Dynamics and Northrup Grumman, and motion and control technologies company Parker-Hannifin contributed at least $200 million to their pensions during the quarter, giving $255 million, $250 million, and $200 million, respectively.

And BWX Technologies, Inc., a supplier of nuclear components and fuel to the US government, said in its third-quarter earnings report that it made a voluntary pension contribution of $118.1 million, while chemicals company Dupont reported that it made a discretionary pension contribution of $114 million during the quarter.




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