US - Defence contractor Lockheed Martin said yesterday it planned to contribute US$2.4bn to its pension funds through 2010.
In a third quarter earnings call, chief financial officer Bruce Tanner said the firm will contribute $1bn into its pension trust in the fourth quarter of 2009, and an additional $1.4bn in 2010.
The firm's 2010 contributions are projected using a discount rate of 6.125% and expected investment returns of 8.5%, but Tanner said more recent returns have been stronger. As of yesterday, Tanner said the returns were in the "mid to upper teens".
Lockheed said its pension contributions dampened earnings. The firm reported third quarter net earnings of $797m, up from $782m last year.
Analyst Collins Stewart downgraded the firm to "hold" because of its pension costs and pressure on margins in the aeronautics sector.
Separately, construction equipment maker Caterpillar said it has already poured $988m into its pension plans this year, and expects that number to hit $1bn by year end.
The firm said yesterday: "To provide the company with greater financial flexibility, we funded a portion of the contribution with company stock. In May, 18.2m shares of company stock contributed to US pension plans. This equated to $650m."
Since June, the company has also been using company stock to fund its 401(k) contributions to the tune of about $10m per month.
A number of pension schemes have been prompted to lock in gains with a move into bonds after the estimated deficit across FTSE 100 DB pension schemes improved by £36bn, over the 12 months ending 30 June last year, JLT Employment Benefits found.
HM Treasury has agreed in principle to give NEST a £329m contingent liability guarantee in the event of the master trust's wind up or closure.
AMP Capital has set up a dedicated team to help institutional investors, including pension funds, invest in infrastructure through direct equity allocations.