EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2024

Defined Contribution Plan

The Company’s defined contribution plan covers all employees. Employees are eligible to participate as of the first day of the month following 30 days of service. Participants can make basic contributions up to 50 percent of their annual salary subject to IRS limits. The Company matches participants’ contributions at the rate of 200 percent of the first 3 percent of each participant’s total basic contribution based on the participant’s total annual salary. The Company’s contribution to the qualified defined contribution plans was $40.0 million, $37.5 million and $33.4 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Defined Benefit and Post-Retirement Medical Plans

The Company sponsors a noncontributory defined benefit pension plan (the “Qualified Plan”) with a policy to fund pension liabilities in accordance with the limits imposed by the Employee Retirement Income Security Act of 1974 and Federal income tax laws. In addition, the Company sponsors a supplemental pension plan covering certain employees, which provides incremental payments that would have been payable from the Company’s principal pension plan, were it not for limitations imposed by income tax regulations (the “Supplemental Plan”). The funded status is measured as the difference between plan assets at fair value and the projected benefit obligation which is to be recognized in the Consolidated Balance Sheets. The plan assets and benefit obligations are measured as of the Consolidated Balance Sheet date.

The non-union Delaware City employees and all Paulsboro, Toledo, Chalmette, Torrance and Martinez employees became eligible to participate in the Company’s defined benefit plans as of the respective acquisition dates. The union Delaware City employees became eligible to participate in the Company’s defined benefit plans upon commencement of normal operations. The Company did not assume any of the employees’ pension liability accrued prior to the respective acquisitions.

The Company formed the Post-Retirement Medical Plan on December 31, 2010 to provide health care coverage continuation from date of retirement to age 65 for qualifying employees associated with the Paulsboro acquisition. The Company credited the qualifying employees with their prior service under Valero Energy Corporation which resulted in the recognition of a liability for the projected benefit obligation. The Post-Retirement Medical Plan includes all corporate and refinery employees.

The changes in the benefit obligation, the changes in fair value of plan assets, and the funded status of the Company’s Pension and Post-Retirement Medical Plans as of and for the years ended December 31, 2024 and 2023 were as follows:


	Pension Plans				Post-Retirement Medical Plan
(in millions)	2024		2023		2024		2023
Change in benefit obligation:
Benefit obligation at beginning of year	$	429.7	$	357.0	$	19.6	$	13.9
Service cost	53.4		48.1		0.9		0.5
Interest cost	20.3		17.7		0.9		0.7
Plan amendments	—		—		—		6.0

Benefit payments	(15.5)		(18.1)		(2.4)		(1.4)
Actuarial loss (gain)	1.9		25.0		(3.4)		(0.1)
Projected benefit obligation at end of year	$	489.8	$	429.7	$	15.6	$	19.6
Change in plan assets:
Fair value of plan assets at beginning of year	$	349.3	$	274.2	$	—	$	—
Actual return on plan assets	25.9		34.8		—		—
Benefits paid	(15.5)		(18.1)		(2.4)		(1.4)

Employer contributions	35.0		58.4		2.4		1.4
Fair value of plan assets at end of year	$	394.7	$	349.3	$	—	$	—
Reconciliation of funded status:
Fair value of plan assets at end of year	$	394.7	$	349.3	$	—	$	—
Less projected benefit obligation at end of year	489.8		429.7		15.6		19.6
Funded status at end of year	$	(95.1)	$	(80.4)	$	(15.6)	$	(19.6)

The accumulated benefit obligation for the defined benefit plans approximated $460.1 million and $391.1 million at December 31, 2024 and 2023, respectively.

Benefit payments, which reflect expected future services that the Company expects to pay are as follows for the years ended December 31:


(in millions)	Pension Benefits		Post-Retirement Medical Plan
2025	$	37.3	$	1.5
2026	31.5		1.6
2027	36.2		1.6
2028	40.1		1.7
2029	44.6		1.6
Years 2030-2034	269.6		7.7

The Company’s funding policy for its defined benefit plans is to contribute amounts sufficient to meet legal funding requirements, plus any additional amounts that may be appropriate considering the funded status of the plans, tax consequences, the cash flow generated by the Company and other factors. The Company plans to contribute approximately $31.6 million to the Company’s Pension Plans during 2025.

The components of net periodic benefit cost for the years ended December 31, 2024, 2023 and 2022 were as follows:


	Pension Benefits						Post-Retirement Medical Plan
(in millions)	2024		2023		2022		2024		2023		2022
Components of net periodic benefit cost:
Service cost	$	53.4	$	48.1	$	55.6	$	0.9	$	0.5	$	0.8
Interest cost	20.3		17.7		7.9		0.9		0.7		0.3
Expected return on plan assets	(24.4)		(19.2)		(17.5)		—		—		—

Amortization of prior service cost and actuarial loss	0.3		—		0.1		0.5		0.1		0.4
Net periodic benefit cost	$	49.6	$	46.6	$	46.1	$	2.3	$	1.3	$	1.5

Lump sum payments made by the Supplemental Plan to employees retiring in 2024, 2023 and 2022 did not exceed the Plan’s total service and interest costs expected for those years.

The pre-tax amounts recognized in other comprehensive loss (income) for the years ended December 31, 2024, 2023 and 2022 were as follows:


	Pension Benefits						Post-Retirement Medical Plan
(in millions)	2024		2023		2022		2024		2023		2022
Prior service costs	$	—	$	—	$	—	$	—	$	6.1	$	—
Net actuarial loss (gain)	0.4		9.5		27.6		(3.3)		(0.2)		(4.0)
Amortization of losses and prior service cost	(0.3)		(0.1)		(0.1)		(0.5)		(0.1)		(0.4)
Total changes in other comprehensive (income) loss	$	0.1	$	9.4	$	27.5	$	(3.8)	$	5.8	$	(4.4)

The pre-tax amounts in accumulated other comprehensive (loss) income as of December 31, 2024 and 2023 that have not yet been recognized as components of net periodic costs were as follows:


	Pension Benefits				Post-Retirement Medical Plan
(in millions)	2024		2023		2024		2023
Prior service costs	$	(0.3)	$	(0.4)	$	(7.6)	$	(8.7)
Net actuarial (loss) gain	(24.6)		(24.4)		13.5		10.9
Total	$	(24.9)	$	(24.8)	$	5.9	$	2.2

The weighted average assumptions used to determine the benefit obligations as of December 31, 2024 and 2023 were as follows:


	Qualified Plan				Supplemental Plan				Post-Retirement Medical Plan
	2024		2023		2024		2023		2024		2023
Discount rate - benefit obligations	5.63	%	4.99	%	5.54	%	4.94	%	5.39	%	4.88	%
Rate of compensation increase	4.55	%	4.27	%	5.00	%	4.50	%	—		—

The weighted average assumptions used to determine the net periodic benefit costs for the years ended December 31, 2024, 2023 and 2022 were as follows:


	Qualified Plan			Supplemental Plan			Post-Retirement Medical Plan
	2024	2023	2022	2024	2023	2022	2024	2023	2022
Discount rates:
Effective rate for service cost	5.00%	5.22%	2.80%	4.94%	5.24%	2.73%	5.00%	5.27%	2.80%
Effective rate for interest cost	4.90%	5.14%	2.33%	4.90%	5.14%	2.24%	4.82%	5.05%	1.91%
Effective rate for interest on service cost	4.89%	5.14%	2.45%	4.84%	5.12%	2.29%	4.93%	5.21%	2.65%
Cash balance interest credit rate	3.99%	4.04%	2.06%	3.99%	4.04%	2.06%	N/A	N/A	N/A
Expected long-term rate of return on plan assets	6.80%	6.75%	5.50%	N/A	N/A	N/A	N/A	N/A	N/A
Rate of compensation increase	4.55%	4.27%	4.26%	4.50%	4.50%	4.50%	N/A	N/A	N/A

The assumed health care cost trend rates as of December 31, 2024 and 2023 were as follows:


	Post-Retirement Medical Plan
	2024		2023
Health care cost trend rate assumed for next year	5.9	%	6.4	%
Rate to which the cost trend rate was assumed to decline (the ultimate trend rate)	4.0	%	4.0	%
Year that the rate reaches the ultimate trend rate	2049		2046

The table below presents the fair values of the assets of the Company’s Qualified Plan as of December 31, 2024 and 2023 by level of fair value hierarchy. Assets consist of collective trusts and are measured at fair value based on the closing net asset value (“NAV”) as determined by the fund manager and reported daily. As noted above, the Company’s post-retirement medical plan is funded on a pay-as-you-go basis and has no assets.


	Fair Value Measurements Using NAV as Practical Expedient
(in millions)	2024		2023
Equities:
Domestic equities	$	121.7	$	75.0
Developed international equities	46.6		46.9
Global low volatility equities	7.9		21.0
Emerging market equities	19.2		24.8
Fixed-income	178.6		159.9


Real Estate	18.7		19.7
Cash and cash equivalents	2.0		2.0
Total	$	394.7	$	349.3

The Company’s investment strategy for its Qualified Plan is to achieve a reasonable return on assets that supports the plan’s interest credit rating, subject to a moderate level of portfolio risk that provides liquidity. Consistent with these financial objectives as of December 31, 2024, the plan’s target allocations for plan assets are 48% invested in equity securities, 46% fixed income investments and 6% in real estate. Equity securities include international stocks and a blend of U.S. growth and value stocks of various sizes of capitalization. Fixed income securities include bonds and notes issued by the U.S. government and its agencies, corporate bonds, and mortgage-backed securities. The aggregate asset allocation is reviewed on an annual basis.

The overall expected long-term rate of return on plan assets for the Qualified Plan is based on the Company’s view of long-term expectations and asset mix.

PBF Holding Co LLC 10-K