Pension Scheme

RNS Number : 9996O

Dewhurst PLC

08 July 2010

 

Dewhurst PLC

(the "Company" or "Dewhurst")

Closure of the Group's defined benefit pension scheme to future accrual

Dewhurst plc yesterday concluded a two month consultation period with employees over its proposal to close the Group's defined benefit pension scheme to future accrual.

Ever since the scheme assets dropped below the liabilities back in the late 1990's, the Board have regularly discussed the future of the pension scheme.  Over the years various steps have been put in place to try and reduce the deficit, whilst keeping the scheme open to future accrual.  In September 2007 the IAS19 deficit stood at £3.8m and the Company agreed to make annual contributions of £0.5m to clear the deficit. Despite making these extra payments there is no indication of the deficit decreasing and instead the latest IAS19 pension valuation reported in September 2009 showed assets of £18.3m and liabilities of £24.4m giving rise to a deficit increase from £3.8m to £6.1m. The increase in the deficit is due to various factors including fluctuating asset returns and increasing life expectancy.

With the cost of final salary pension provision continuing to increase the Board reluctantly feel the closure of the defined benefit scheme to future accrual is now essential in order to secure the pensions already accrued, achieve future risk reduction and protect the long term future of the Group. Closing the scheme to future accrual will help limit the increase in liabilities and help the Group to fulfill its commitment to eliminate the current deficit.

Current contributing members, who from 1^st October 2010 will no longer build up future benefits in their defined benefit scheme, will be given the choice of building up future pension benefits in a new proposed Group defined contribution scheme.

For further details please contact:

Dewhurst Plc	Tel: [phone]
Jared Sinclair
Seymour Pierce Ltd	Tel: [phone]
Nicola Marrin/Stewart Dickson

 

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