Past comments on various Frontier Communications (FTR) articles have expressed concern the funding gap in the retirement and pension funds would start eating into cash required for capital expenditures, debt reduction and the biggest worry, dividends, especially if the unfunded status grows.
FTR has unfunded liabilities in excess of a billion dollars. It is reflected on the balance sheet under long-term liabilities labeled “Pension and other post-retirement benefits”. Much of this is due to the acquisition of the Verizon (VZ) properties in 2010. This article will look at the unfunded status of the Pension Plan and the OPEB or “Post-retirement Benefits Other Than Pensions” followed by a conclusion.
We’ll start by taking a look at results over the last three years by quarter ($ in thousands):
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