Business
Switch off of Pension Deficit Repair Payments
Switch off of Pension Deficit Repair Payments.
About this update from Coats Group Plc
[{"type":"text","content":"\n\n \n 7 December 2023\nCoats Group plc\n \nAgreement with UK Pension Scheme Trustee to switch off Deficit Repair Payments\n \nCoats Group plc (\"Coats\" or the \"Group\") is pleased to announce that it has reached agreement with the trustee of the Coats UK Pension Scheme (\"scheme\") to switch off pension deficit repair payments1 from 1 January 2024.\n \nThe Group has agreed to pay the scheme a one-off lump sum payment of £10 million ($12.6 million) to move it into an expected surplus position against the technical provisions funding basis and enable the switch off threshold to be comfortably met.\n \nThis agreement will result in a free cash flow benefit of £2 million ($2.5 million) per month while the payments remain switched off. The deficit repair payments will remain switched off so long as the scheme's assets remain above 99% of its technical provisions2.\n \nJackie Callaway, Chief Financial Officer, said:\n \n\"We have made significant progress on pensions in recent years, and the news today is another major milestone that benefits all stakeholders. We remain focused on making further progress in order to maximise Coats' free cash flow generation. We are continuing to work with the trustee of the scheme on a collaborative basis, with the medium term aspiration of fully insuring the scheme, removing UK pension risk from the Group balance sheet and optimising our capital allocation framework to enable additional growth opportunities.\"\n \nThis announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 (\"UK MAR\").\n \n\n\n\n\n \nEnquiries\n\n\n \n\n\n \n\n\n \n\n\n\n\nInvestors\n\n\nVictoria Huxster /\nJulian Wais\n\n\nCoats Group plc\n\n\n+44 (0)7880 471350 / +44 (0)7720 999764\n\n\n\n\nMedia\n\n\nRichard Mountain /\nNick Hasell\n\n\nFTI Consulting\n\n\n+44 (0)20 3727 1374\n\n\n\n\n \n\n\n\n\n\n\n\n\n\n\n\n\n\n \n \n1. The scheme's last triennial actuarial valuation at 31 March 2021 showed a deficit between the scheme's assets and its pension liabilities (the \"technical provisions\"). Following the valuation, Coats agreed to pay monthly ...