2008 Annual Report - Hubbell Wiring Device-Kellems

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HUBBELL INCORPORATED AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)The accumulated benefit obligation for all defined benefit pension plans was $529.8 million and $516.2 millionat December 31, 2008 and 2007, respectively. Information with respect to plans with accumulated benefitobligations in excess of plan assets is as follows, (in millions):2008 2007Projected benefit obligation ......................................... $499.8 $49.5Accumulated benefit obligation. ...................................... $461.8 $45.1Fair value of plan assets ............................................ $388.7 $ 0.4The following table sets forth the components of pension and other benefits cost for the years endedDecember 31, (in millions):Pension Benefits Other Benefits2008 2007 2006 2008 2007 2006Components of net periodic benefit costService cost .................................. $ 14.6 $ 16.9 $ 17.9 $ 0.2 $ 0.5 $0.3Interest cost .................................. 35.8 32.7 30.9 1.7 1.7 2.1Expected return on plan assets .................... (47.5) (42.6) (37.5) — — —Amortization of prior service cost .................. 0.4 (0.3) (0.4) (0.2) (0.2) —Amortization of actuarial losses. ................... 1.3 1.9 3.8 — 0.1 0.3Special termination benefits ...................... — — — — — 0.4Curtailment and settlement losses .................. — (0.1) 0.7 (1.7) 1.4 —Net periodic benefit cost . . . ...................... $ 4.6 $ 8.5 $15.4 $ — $ 3.5 $3.1Changes recognized in accumulated othercomprehensive income, before tax, (in millions):Current year net actuarial loss/(gain) ................ $148.9 $(66.0) $ 0.3 $(4.8)Current year prior service cost .................... 0.2 — — —Amortization of prior service cost .................. (0.4) 0.3 0.2 0.2Amortization of net actuarial (loss)/gain ............. (1.3) (1.9) — (0.1)Currency impact ............................... (1.0) — — —Other adjustments .............................. 0.1 0.1 — —Total recognized in accumulated other comprehensiveincome .................................... 146.5 (67.5) 0.5 (4.7)Total recognized in net periodic pension cost andaccumulated other comprehensive income ........ $151.1 $(59.0) $ 0.5 $(1.2)Amortization expected to be recognized throughincome during 2009Amortization of prior service cost/(credit) ............ $ 0.3 $ 0.3 $(0.2) $(0.2)Amortization of net loss/(gains). ................... 6.9 1.3 — —Total expected to be recognized through income duringnext fiscal year .............................. $ 7.2 $ 1.6 $(0.2) $(0.2)In addition to the above, certain of the Company’s union employees participate in multi-employer definedbenefit plans. The total Company cost of these plans was $0.9 million in 2008 and $0.7 million in both 2007 and2006.56
HUBBELL INCORPORATED AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)The Company also maintains five defined contribution pension plans (excluding an employer match for the401(k) plan). The total cost of these plans was $5.9 million in 2008, $5.8 million in 2007 and $5.6 million in 2006.This cost is not included in the above net periodic benefit cost for the defined benefit pension plans.AssumptionsThe following assumptions were used to determine the projected benefit obligations at the measurementdate and the net periodic benefit cost for the year:Pension BenefitsOther Benefits2008 2007 2006 2008 2007 2006Weighted-average assumptions used to determinebenefit obligations at December 31,Discount rate ............................... 6.46% 6.41% 5.66% 6.50% 6.50% 5.75%Rate of compensation increase .................. 4.07% 4.58% 4.33% 4.00% 4.00% 4.00%Weighted-average assumptions used to determinenet periodic benefit cost for years endedDecember 31,Discount rate ............................... 6.41% 5.66% 5.45% 6.50% 5.75% 5.50%Expected return on plan assets .................. 8.00% 8.00% 8.00% N/A N/A N/ARate of compensation increase .................. 4.07% 4.58% 4.33% 4.00% 4.00% 4.00%At the beginning of each calendar year, the Company determines the appropriate expected return on assets foreach plan based upon its strategic asset allocation (see discussion below). In making this determination, theCompany utilizes expected returns for each asset class based upon current market conditions and expected riskpremiums for each asset class.The assumed health care cost trend rates used to determine the projected postretirement benefit obligationare as follows:Other Benefits2008 2007 2006Assumed health care cost trend rates at December 31Health care cost trend assumed for next year ........................ 8.0% 9.0% 9.0%Rate to which the cost trend is assumed to decline .................... 5.0% 5.0% 5.0%Year that the rate reaches the ultimate trend rate ..................... 2015 2015 2015Assumed health care cost trend rates have a significant effect on the amounts reported for the postretirementbenefit plans. A one-percentage-point change in assumed health care cost trend rates would have thefollowing effects (in millions):One PercentagePoint IncreaseOne PercentagePoint DecreaseEffect on total of service and interest cost .................... $0.1 $(0.1)Effect on postretirement benefit obligation .................... $1.3 $(1.2)57
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P O S I T I O N E D F O R T O D A Y
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2008 SALESby Segmentby GeographyPow
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The success of “today” position
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POSITIONED FOR TODAYby consistently
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POWER SEGMENTBrand recognition and
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DRIVINGPERFORMANCETHROUGHPRODUCTIVI
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KURT VERSEN INC,ACQUIRED IN JANUARY
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13THE LIGHTING SOLUTIONSLAB AT HUBB
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THE FUTURE ISELECTRIC WITHOPPORTUNI
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OFFSHORE OIL RIGS AREJUST ONE OF MA
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HUBBELL INCORPORATEDANNUAL REPORT O
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The Company’s annual report on Fo
Page 27 and 28: Commercial/Institutional and Indust
Page 29 and 30: Haefely Test, AG based in Switzerla
Page 31 and 32: A global recession and continued wo
Page 33 and 34: Item 2. PropertiesHubbell’s manuf
Page 35 and 36: Name. Age(1) Present Position Busin
Page 37 and 38: Purchases of Equity SecuritiesIn Fe
Page 39 and 40: Item 6.Selected Financial DataThe f
Page 41 and 42: • Revenue GrowthOrganic Growth. I
Page 43 and 44: the 2007 rate related to the closin
Page 45 and 46: one in 2007 as well as a higher amo
Page 47 and 48: management, production planning and
Page 49 and 50: Although these facilities are not t
Page 51 and 52: offer retiree medical benefits to a
Page 53 and 54: overhead, maintenance and training
Page 55 and 56: • Changes in strategy, economic c
Page 57 and 58: Item 8.Financial Statements and Sup
Page 59 and 60: REPORT OF INDEPENDENT REGISTERED PU
Page 61 and 62: HUBBELL INCORPORATED AND SUBSIDIARI
Page 65 and 66: Foreign Currency TranslationThe ass
Page 67 and 68: measurement attribute for the finan
Page 77: HUBBELL INCORPORATED AND SUBSIDIARI
Page 81 and 82: Note 12 — DebtHUBBELL INCORPORATE
Page 87 and 88: Note 17 — Capital StockHUBBELL IN
Page 93 and 94: computation of earnings per dilutiv
Page 95 and 96: Industry Segment DataHUBBELL INCORP
Page 99 and 100: Item 11.Item 12.Executive Compensat
Page 101 and 102: NumberDescription10h† Hubbell Inc
Page 103 and 104: NumberDescription31.1* Certificatio
Page 105 and 106: Schedule IIHUBBELL INCORPORATED AND
Page 107 and 108: Exhibit 31.1I, Timothy H. Powers, c
Page 109 and 110: Exhibit 32.1CERTIFICATION PURSUANT
Page 111 and 112: BOARD OF DIRECTORSE. RICHARD BROOKS
Page 113 and 114: CORPORATEOFFICERSTIMOTHY H. POWERSC
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