STV agrees reduced pension deficit, lower contributions

2nd Oct 2024 11:21

(Sharecast News) - STV Group announced on Wednesday that it has reached an agreement with the trustees of its defined benefit pension schemes following the completion of its 31 December 2023 triennial funding valuations.

The London-listed broadcaster reported a significant reduction in the combined funding deficit, which now stood at £61m, down from £116m in the 2020 valuation.

That calculation took into account movements in the funding position up to 30 June this year.

STV said the deficit recovery plans remained unchanged, with an end date of 31 October 2030.

Under the new agreement, STV's monthly cash contributions would be slightly lower than in the prior arrangement.

Contributions for 2025 would total £10.2m, with annual payments increasing by 2% per year over the recovery period, in line with the previous plan.

Additionally, the contingent cash contribution mechanism had been paused until at least 2028, meaning no further contingent payments would be required before that time unless both parties agreed otherwise.

The recovery plans were designed to bring the schemes to a fully funded position by 2030, using prudent future assumptions.

STV said the next triennial valuations would be conducted as of 31 December 2026.

"Agreement on the pension scheme valuations has been reached in an efficient and timely manner, providing certainty to STV, the schemes' trustees and to our other stakeholders, as well as demonstrating STV's continued commitment to our former colleagues," said chief financial and operating officer Lindsay Dixon.

"Retaining the existing recovery period end date, combined with the small reduction in cash payments under the new schedules of contributions and the pause in any contingent cash requirements, reflects the positive progress against plan which the schemes have made in recent years despite markets having been volatile over the period.

"The new valuation agreements will provide the company with additional flexibility across the full spectrum of capital allocation."

At 1038 BST, shares in STV Group were up 1.64% at 248p.

Reporting by Josh White for Sharecast.com.