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SEC Filings

10-Q
INTERPUBLIC GROUP OF COMPANIES, INC. filed this Form 10-Q on 04/21/2017
Entire Document
 
Notes to Consolidated Financial Statements – (continued)
(Amounts in Millions, Except Per Share Amounts)
(Unaudited)


Amounts reclassified from accumulated other comprehensive loss, net of tax, for the three months ended March 31, 2017 and 2016 are as follows:
 
Three months ended
March 31,
 
Affected Line Item in the Consolidated Statements of Operations
 
2017
 
2016
 
Foreign currency translation adjustments 1
$
1.2

 
$
(1.0
)
 
Other income (expense), net
Losses on derivative instruments
0.5

 
0.5

 
Interest expense
Amortization of defined benefit pension and postretirement plan items
1.7

 
2.7

 
Other income (expense), net
Tax effect
(0.6
)
 
(1.1
)
 
Benefit of income taxes
Total amount reclassified from accumulated other comprehensive loss, net of tax
$
2.8

 
$
1.1

 
 
 
1
These foreign currency translation adjustments are primarily a result of the sales of businesses.
 
Note 8:  Employee Benefits
We have a defined benefit pension plan that covers certain U.S. employees (the “Domestic Pension Plan”). We also have numerous funded and unfunded plans outside the U.S. The Interpublic Limited Pension Plan in the U.K. is a defined benefit plan and is our most material foreign pension plan in terms of the benefit obligation and plan assets. Some of our domestic and foreign subsidiaries provide postretirement health benefits and life insurance to eligible employees and, in certain cases, their dependents. The domestic postretirement benefit plan is our most material postretirement benefit plan in terms of the benefit obligation. Certain immaterial foreign pension and postretirement benefit plans have been excluded from the table below.
The components of net periodic cost for the Domestic Pension Plan, the significant foreign pension plans and the domestic postretirement benefit plan are listed below.
 
Domestic Pension Plan
 
Foreign Pension Plans
 
Domestic Postretirement Benefit Plan
Three months ended March 31,
2017
 
2016
 
2017
 
2016
 
2017
 
2016
Service cost
$
0.0

 
$
0.0

 
$
0.9

 
$
2.7

 
$
0.0

 
$
0.0

Interest cost
1.3

 
1.5

 
3.3

 
4.5

 
0.3

 
0.4

Expected return on plan assets
(1.6
)
 
(1.7
)
 
(4.3
)
 
(5.3
)
 
0.0

 
0.0

Amortization of:
 
 
 
 
 
 
 
 
 
 
 
Prior service credit
0.0

 
0.0

 
0.0

 
0.0

 
0.0

 
(0.1
)
Unrecognized actuarial losses
0.4

 
1.9

 
1.3

 
0.9

 
0.0

 
0.0

Net periodic cost
$
0.1

 
$
1.7

 
$
1.2

 
$
2.8

 
$
0.3

 
$
0.3

The components of net periodic cost other than the service cost component are included in the line item “Other income (expense), net” in the Consolidated Statements of Operations.
During the three months ended March 31, 2017, we contributed $4.4 of cash to our foreign pension plans. For the remainder of 2017, we expect to contribute approximately $1.0 and $13.0 of cash to our domestic and foreign pension plans, respectively.

Note 9:  Segment Information
As of March 31, 2017, we have two reportable segments: IAN and Constituency Management Group ("CMG"). IAN is comprised of McCann Worldgroup, Foote, Cone & Belding ("FCB"), MullenLowe Group, IPG Mediabrands, our digital specialist agencies and our domestic integrated agencies. CMG is comprised of a number of our specialist marketing services offerings. We also report results for the “Corporate and other” group. The profitability measure employed by our chief operating decision maker for allocating resources to operating divisions and assessing operating division performance is segment operating income (loss). Segment information is presented consistently with the basis described in our 2016 Annual Report on Form 10-K.

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