Here Is AT&T's Epic $8 Billion Friday Night News Dump
AP
AT&T met the latter criteria this week.
On Friday night, AT&T disclosed that in the fourth quarter, it will take a $7.9 billion noncash, pre-tax loss related to an adjustment in assumptions made for its pension plan.
The company announced that on December 31, it adjusted its assumed discount rate for its pension obligation to 4.3%. Previously, the company had used a 5% discount rate, according to its most recent 10-K filed with the SEC.
The discount rate used to measure a pension obligation is what the company assumes the pension fund will return over time in order to meet its obligations. Cutting this rate means that, basically, AT&T's pension fund is expected to yield less now than it was previously, and so as a result the company will have to put additional capital into the fund to meet its future obligations.
The company also said that contributing to the loss were, "updated mortality assumptions," which means that people covered under AT&T's pension plan are now living longer.
And in addition to the pension adjustment, AT&T disclosed that its Q4 results will include a $2.1 billion charge due to the abandonment of network assets after the company determined that some copper assets won't be needed to support its network in the future.
Shares of AT&T were little-changed in after hours trade on Friday, as these kinds of impairments and hiccups can't be totally unexpected for a company that employed more than 240,000 at the end of 2013 and has a market cap of more than $170 billion.
On Twitter, Bloomberg's Joe Weisenthal noted that in January 2013, the company also took a $10 billion pension charge
But still, this isn't the best news, and burying news on a Friday night can give the impression that a company is hoping not everyone notices. Or something like that.
You can read AT&T's filing with the SEC here »
(via @TheStalwart)
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