5.2 Pensions and other long-term employee benefits
Jotun A/S has both defined contribution and defined benefit pension plans. The majority of the
company’s pension plans are defined contribution plans, whereby the company’s obligation is limited
to annual contributions to the employees’ pension plans. Costs related to the defined benefit plans
account for less than five per cent of total pension costs in 2019.
Summary of pension costs
(NOK THOUSAND) 2019 2018
Pension costs defined contribution plans and other severence schemes 87 995 73 746
Pension costs defined benefit plans 3 881 3 586
Total pension costs recognised in the income statement, ref. Note 2.2 91 876 77 332
Actuarial gain / loss (-) recognised in other comprehensive income
(net of tax)
-3 573 2 246
The defined benefit schemes were replaced by defined contribution plans in 2004. Net pension
obligations as of 31 December 2019 are primarily related to previous early retirement schemes for Jotun
A/S’s senior executives.
Other severance schemes are obligations related to operating pension schemes for employees with an
annual basic salary and pension base exceeding 12 times the basic amount (G).
Actuarial assumptions
2019 2018
Discount rate in % 1.3 2.0
Expected return in % 1.3 2.0
Wage adjustment in % 2.25 2.75
Inflation / increase in social security basic amount (G), in % 2.0 2.5
Pension adjustment in % 0.7-2.25 0.8-2.75
Schemes with net pension obligation
Pension plan
assets
Defined benefit
obligations
Back to Notes for the Parent Company
Net pension
obligations
(NOK THOUSAND) 2019 2018 2019 2018 2019 2018
Balance as of 1 January 452 432 -78 452 -69 611 -78 000 -69 179
Recognised in the income statement
Pension earnings for the year - - -2 368 -2 339 -2 368 -2 339
Interest income /cost (-) - - -1 512 -1 245 -1 512 -1 245
Expected return on pension plan assets -2 -2 - - -2 -2
Recognised in the Income Statement -2 -2 -3 880 -3 584 -3 882 -3 586
Actuarial gain / loss (-) recognised in
Other Comprehensive Income 332 -6 4 249 -2 874 4 581 -2 880
Other movements
Benefits paid - - 5 833 8 099 5 833 8 099
Contribution paid to pension schemes 23 28 3 4 26 32
Transfer to / from schemes with net
- - -8 921 -10 486 -8 921 -10 486
pension liabilities
Net pension obligation defined
benefit plans
805 452 -81 168 -78 452 -80 363 -78 000
Other severance schemes - - -72 084 -64 086 -72 084 -64 086
Balance as of 31 December 805 452 -153 252 -142 538 -152 447 -142 086
Breakdown of net pension liabilities in funded and unfunded schemes
(NOK THOUSAND) 31.12.2019 31.12.2018
Present value of funded pension obligations -271 -222
Pension plan assets 805 452
Net funded pension assets 534 230
Present value of unfunded pension obligations -152 981 -142 316
Capitalised net pension assets / liabilities (-) -152 447 -142 086
Breakdown of pension plan assets (fair value)
31.12.2019 31.12.2018
Cash and cash equivalents in % 7.6 2.9
Bonds in % 64.2 67.4
Shares in % 14.8 16.0
Property in % 13.4 13.7
Total pension plan assets 100.0 100.0
JOTUN A/S
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