T I F FA N Y & C O [ T I F : U S ]
PENSION PLAN & POSTRETIREMENT BENEFITS OBLIGATION ■
Currently, Tiffany’s total pension/post-retirement benefits obligation is underfunded by US$326M, after the Company made a voluntary cash contribution of US$120M to its pension plan in FY2016.
We concur with Management’s decision to bring down its pension/post retirement benefits obligation, as has occurred in recent years.
With a strong cash flow generative business, we see current pension/post retirement benefits obligation level to be manageable, but would prefer this to be moved to a fully funded status in the years ahead (interest rates normalising will also “naturally” assist in reducing this deficit).
Source: Tiffany 2016 Annual Report and Thomson Reuters Eikon