Pension problems plague Remington

Discussion in 'General Discussion' started by Quigley_Sharps, Sep 26, 2005.

  1. Quigley_Sharps

    Quigley_Sharps The Badministrator Administrator Founding Member

    MADISON -- Madison-based Remington Arms Co. has sent a letter to employees saying the company's long-term survival could be jeopardized because of pension plan problems.

    Thomas Millner, chief executive of the firearms manufacturer, said the pension plan is receiving low interest rates and returns on its investments, the Arkansas Democrat-Gazette newspaper in Little Rock reported.

    Remington employs about 175 people at its headquarters in Madison and more than 2,300 people in three plants -- in Ilion, N.Y., Lonoke, Ark.; and Mayfield, Ky.

    "Our company is facing one of its biggest financial challenges of the past 25 years," Millner wrote.

    Officials in Madison had little comment on the report Friday.

    "Our position on that as a company is that is an internal communication that went out from the company to its employees. We try not to have those discussions outside the internal confines of the company," said Steve Jackson, the senior vice president of finance and service operations.

    In the letter, Millner said the company is meeting its legal obligations regarding the plan. The Remington Arms pension plan covers all nonunion" employees hired before June 1996 and all union" employees hired before September 1997.

    The rifle and shotgun company's pension plans had assets of $109.6 million at the end of 2004, according to its annual report filed with the Securities and Exchange Commission. By the end of that year, the company had accumulated benefit obligations of $138.9 million, which benefit plan experts say indicates a shortfall of at least $29.3 million.

    Millner said in his letter that the plan's multimillion-dollar future liability could be beyond the company's ability to fund from its earnings.

    Remington had a net loss of $3.2 million in 2003 and $4 million last year after combined earnings of more than $53 million the three previous years. Its debt has grown from $157 million in 2000 to $203 million last year.

    As the only U.S. company to produce both guns and ammunition, Remington is the top U.S. seller of rifles and ammo and the No. 2 seller of shotguns behind Mossberg.

    But it has been affected by high metal prices, mixed consumer spending and the need to introduce new product lines, including its Spartan Gunworks, a line of imported shotguns and rifles aimed at the lower end of the market. Remington sold its Stren fishing line business to Pure Fishing in early 2004.

    Equity firm Bruckmann, Rosser, Sherrill & Co. owns a majority stake in the company.
  2. ghostrider

    ghostrider Resident Poltergeist Founding Member

    Remington has traditionally been the last firm to embrace change. They were the last to go to an interchangeable choke tube in a shotgun. The only thing drastic they did in milleniums were abominations, the 597 and 510. Firearms is not a soft market anymore, they will have to do what USRA, Mossberg and Savage did before them, reinvent themselves in the marketplace, build what people want. They will have to create that demand, not wait for a cyclical hunting market to come back around.
  3. ghostrider

    ghostrider Resident Poltergeist Founding Member

    Like to see a repro Remington Rand 1911A1.
    Remington M14.
    870 Riot marketed for civilians, also in 20 gauge, short stock.
  4. E.L.

    E.L. Moderator of Lead Moderator Emeritus Founding Member

  5. CRC

    CRC Survivor of Tidal Waves | RIP 7-24-2015 Moderator Emeritus Founding Member

    I got to tour the factory in Ilion back in the 80's...Interesting..they didn't like women who could ask questions though...kept "patting" me on the head....and telling me things like "Don't worry your pretty little head about that".. :rolleyes:

    So I drove over to Utica, toured the Utica Club brewery afterward , got two free beers at the end of the tour and found the nearest bar..... 8)
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