Company: GGG
Filing Date: 2025-02-18
Form Type: 10-K
Source: 0000042888-25-000011
Chunk: 95

Company: GRACO INC
Filing Date: 2025-02-18
Form: 10-K
Item: Item 8
Chunk 95
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%Rate of compensation increase2.5 %2.7 %N/AN/ANon-U.S. PlansDiscount rate1.4 %2.1 %N/AN/ARate of compensation increase2.0 %1.7 %N/AN/AAssumptions used to determine the Company’s net periodic benefit cost are shown below: Pension BenefitsPostretirement Medical BenefitsWeighted average assumptions            202420232022202420232022U.S. PlansDiscount rate5.3 %5.6 %3.0 %5.3 %5.6 %2.9 %Rate of compensation increase2.7 %2.7 %2.7 %N/AN/AN/AExpected return on assets7.6 %7.6 %6.3 %N/AN/AN/ANon-U.S. PlansDiscount rate2.1 %0.4 %0.4 %N/AN/AN/ARate of compensation increase1.7 %1.3 %1.3 %N/AN/AN/AExpected return on assets2.1 %1.6 %1.0 %N/AN/AN/ASeveral sources of information are considered in determining the expected rate of return assumption, including the allocation of plan assets, the input of actuaries and professional investment advisers, and historical long-term returns. In setting the return assumption, the Company recognizes that historical returns are not always indicative of future returns and also considers the long-term nature of its pension obligations.The Company’s U.S. retirement medical plan limits the annual cost increase that will be paid by the Company to 3 percent. In measuring the accumulated postretirement benefit obligation (APBO), the annual trend rate for health care costs was assumed to be 8.5 percent for 2025, decreasing each year to a constant rate of 4.0 percent for 2050 and thereafter, subject to the plan’s annual increase limitation.The Company expects to contribute $2 million to its unfunded pension plans and $2 million to the postretirement medical plan in 2025. The Company will not be required to make contributions to the funded pension plan under minimum funding requirements for 2025. Estimated future benefit payments are as follows (in thousands):PensionBenefitsPostretirementMedical Benefits2025$6,148 $1,633 20268