SEC Filing | Unisys Corporation

View:

uis-20220930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission file number 1-8729

UNISYS CORPORATION

(Exact name of registrant as specified in its charter)


Delaware						38-0387840
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

801 Lakeview Drive, Suite 100

Blue Bell, Pennsylvania 19422

(215) 986-4011

(Address, zip code and telephone number, including area code, of principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $.01	UIS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of Unisys Common Stock, par value $.01, outstanding as of September 30, 2022: 67,787,549

UNISYS CORPORATION

TABLE OF CONTENTS


PART I - FINANCIAL INFORMATION		Page Number
Item 1.	Consolidated Financial Statements (Unaudited)
	Consolidated Statements of Income (Loss)	2
	Consolidated Statements of Comprehensive Income (Loss)	3
	Consolidated Balance Sheets	4
	Consolidated Statements of Cash Flows	5
	Consolidated Statements of Deficit	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	30
Item 4.	Controls and Procedures	30
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32
Item 6.	Exhibits	35

Exhibit Index		36
Signatures		37

Part I - FINANCIAL INFORMATION

Item 1. Financial Statements

UNISYS CORPORATION

CONSOLIDATED STATEMENTS OF INCOME (LOSS) (Unaudited)

(Millions, except per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenue
Services	$	395.2	$	417.9	$	1,187.6	$	1,268.8
Technology	66.0		70.1		235.3		246.3
	461.2		488.0		1,422.9		1,515.1
Costs and expenses
Cost of revenue
Services	318.2		343.1		961.6		1,019.7
Technology	38.7		18.0		121.5		87.1
	356.9		361.1		1,083.1		1,106.8
Selling, general and administrative	106.3		95.1		320.3		279.7
Research and development	6.0		6.7		17.3		19.1
	469.2		462.9		1,420.7		1,405.6
Operating (loss) income	(8.0)		25.1		2.2		109.5
Interest expense	7.9		8.5		24.6		27.0
Other (expense), net	(23.3)		(24.2)		(66.2)		(434.6)
Loss before income taxes	(39.2)		(7.6)		(88.6)		(352.1)
Provision for (benefit from) income taxes	0.7		10.9		25.1		(33.8)
Consolidated net loss	(39.9)		(18.5)		(113.7)		(318.3)
Net income (loss) attributable to noncontrolling interests	0.2		0.2		0.8		(1.0)
Net loss attributable to Unisys Corporation	$	(40.1)	$	(18.7)	$	(114.5)	$	(317.3)


Loss per share attributable to Unisys Corporation



Basic	$	(0.59)	$	(0.28)	$	(1.69)	$	(4.79)



Diluted	$	(0.59)	$	(0.28)	$	(1.69)	$	(4.79)

See notes to consolidated financial statements

UNISYS CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited)

(Millions)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021


Consolidated net loss	$	(39.9)	$	(18.5)	$	(113.7)	$	(318.3)
Other comprehensive income (loss)
Foreign currency translation	(90.9)		(36.5)		(204.2)		(36.8)
Postretirement adjustments, net of tax of $14.4 and $35.2 in 2022 and $7.4 and $45.2 in 2021	89.1		63.4		234.8		408.6
Total other comprehensive (loss) income	(1.8)		26.9		30.6		371.8
Comprehensive (loss) income	(41.7)		8.4		(83.1)		53.5
Less comprehensive income (loss) attributable to noncontrolling interests	0.1		(0.8)		(0.5)		(0.5)
Comprehensive (loss) income attributable to Unisys Corporation	$	(41.8)	$	9.2	$	(82.6)	$	54.0

See notes to consolidated financial statements

UNISYS CORPORATION

CONSOLIDATED BALANCE SHEETS (Unaudited)

(Millions)


	September 30, 2022			December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	351.4		$	552.9
Accounts receivable, net	404.6			451.7
Contract assets	26.3			42.0
Inventories	12.4			7.6
Prepaid expenses and other current assets	83.7			78.8
Total current assets	878.4			1,133.0
Properties	436.8			468.0
Less-accumulated depreciation and amortization	359.1			381.5
Properties, net	77.7			86.5
Outsourcing assets, net	78.7			124.6
Marketable software, net	168.6			176.2
Operating lease right-of-use assets	48.0			62.7
Prepaid postretirement assets	170.7		*	159.7
Deferred income taxes	109.9			125.3
Goodwill	286.2			315.0
Intangible assets, net	54.8			34.9
Restricted cash	13.6			7.7
Assets held-for-sale	20.0			20.0
Other long-term assets	151.5			173.9
Total assets	$	2,058.1	*	$	2,419.5
Liabilities and deficit
Current liabilities:
Current maturities of long-term-debt	$	17.5		$	18.2
Accounts payable	157.3			180.2
Deferred revenue	206.2			253.2
Other accrued liabilities	261.0			300.9

Total current liabilities	642.0			752.5
Long-term debt	498.4			511.2
Long-term postretirement liabilities	851.0		*	976.2
Long-term deferred revenue	127.2			150.7
Long-term operating lease liabilities	34.0			46.1
Other long-term liabilities	40.8			47.2
Commitments and contingencies (see Note 15)
Deficit:
Common stock, shares issued: 2022; 73.3, 2021; 72.5	0.7			0.7
Accumulated deficit	(1,523.5)			(1,409.0)
Treasury stock, shares at cost: 2022; 5.5, 2021; 5.3	(155.9)			(152.2)
Paid-in capital	4,726.8			4,710.9
Accumulated other comprehensive loss	(3,232.2)			(3,264.1)
Total Unisys Corporation stockholders’ deficit	(184.1)			(113.7)
Noncontrolling interests	48.8			49.3
Total deficit	(135.3)			(64.4)
Total liabilities and deficit	$	2,058.1	*	$	2,419.5

*These consolidated financial statements reflect a change of $15.2 million to increase both assets and liabilities, as compared to the previously filed consolidated financial statements on November 7, 2022.

See notes to consolidated financial statements

UNISYS CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(Millions)


	Nine Months Ended September 30,
	2022		2021
Cash flows from operating activities
Consolidated net loss	$	(113.7)	$	(318.3)

Adjustments to reconcile consolidated net loss to net cash (used for) provided by operating activities:


Foreign currency losses	6.3		3.2
Non-cash interest expense	1.0		1.5
Employee stock compensation	15.2		11.5
Depreciation and amortization of properties	29.3		23.2
Depreciation and amortization of outsourcing assets	48.8		50.8
Amortization of marketable software	42.7		50.9
Amortization of intangible assets	7.7		1.7
Other non-cash operating activities	0.2		(0.1)
Loss on disposal of capital assets	1.6		1.5
Postretirement contributions	(33.9)		(43.6)
Postretirement expense	34.1		407.7
Deferred income taxes, net	(6.5)		(65.3)
Changes in operating assets and liabilities, excluding the effect of acquisitions:
Receivables, net and contract assets	48.4		135.0
Inventories	(5.6)		2.2
Other assets	(2.5)		(4.1)
Accounts payable and current liabilities	(101.5)		(229.6)
Other liabilities	6.2		36.3
Net cash (used for) provided by operating activities	(22.2)		64.5
Cash flows from investing activities
Purchase of businesses, net of cash acquired	(0.3)		(150.4)

Proceeds from investments	2,441.0		3,286.4
Purchases of investments	(2,499.4)		(3,294.6)
Investment in marketable software	(35.2)		(42.1)
Capital additions of properties	(21.5)		(19.7)
Capital additions of outsourcing assets	(8.1)		(14.7)
Other	(0.9)		(0.9)
Net cash used for investing activities	(124.4)		(236.0)
Cash flows from financing activities
Payments of long-term debt	(14.6)		(99.1)

Proceeds from issuance of long-term debt	—		1.5

Proceeds from exercise of stock options	—		4.5
Other	(3.8)		(7.7)
Net cash used for financing activities	(18.4)		(100.8)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(30.6)		(9.9)
Decrease in cash, cash equivalents and restricted cash	(195.6)		(282.2)
Cash, cash equivalents and restricted cash, beginning of period	560.6		906.7
Cash, cash equivalents and restricted cash, end of period	$	365.0	$	624.5

See notes to consolidated financial statements

UNISYS CORPORATION

CONSOLIDATED STATEMENTS OF DEFICIT (Unaudited)

(Millions)


			Unisys Corporation
	Total		Total Unisys Corporation		Common Stock Par Value		Accumu-lated Deficit		Treasury Stock At Cost		Paid-in Capital		Accumu-lated Other Compre-hensive Loss		Non-controlling Interests
Balance at December 31, 2021	$	(64.4)	$	(113.7)	$	0.7	$	(1,409.0)	$	(152.2)	$	4,710.9	$	(3,264.1)	$	49.3
Consolidated net (loss) income	(57.0)		(57.3)				(57.3)								0.3


Stock-based activity	2.2		2.2						(3.5)		5.7
Translation adjustments	(17.7)		(14.9)										(14.9)		(2.8)
Postretirement plans	57.3		55.7										55.7		1.6
Balance at March 31, 2022	$	(79.6)	$	(128.0)	$	0.7	$	(1,466.3)	$	(155.7)	$	4,716.6	$	(3,223.3)	$	48.4
Consolidated net income (loss)	(16.8)		(17.1)				(17.1)								0.3
Stock-based activity	5.1		5.1						(0.2)		5.3
Translation adjustments	(95.6)		(92.3)										(92.3)		(3.3)
Postretirement plans	88.4		85.1										85.1		3.3
Balance at June 30, 2022	$	(98.5)	$	(147.2)	$	0.7	$	(1,483.4)	$	(155.9)	$	4,721.9	$	(3,230.5)	$	48.7
Consolidated net (loss) income	(39.9)		(40.1)				(40.1)								0.2
Stock-based activity	4.9		4.9								4.9
Translation adjustments	(90.9)		(87.4)										(87.4)		(3.5)
Postretirement plans	89.1		85.7										85.7		3.4
Balance at September 30, 2022	$	(135.3)	$	(184.1)	$	0.7	$	(1,523.5)	$	(155.9)	$	4,726.8	$	(3,232.2)	$	48.8


			Unisys Corporation
	Total		Total Unisys Corporation		Common Stock Par Value		Accumu-lated Deficit		Treasury Stock At Cost		Paid-in Capital		Accumu-lated Other Compre-hensive Loss		Non-controlling Interests
Balance at December 31, 2020	$	(312.1)	$	(356.8)	$	0.7	$	(960.5)	$	(114.4)	$	4,656.9	$	(3,939.5)	$	44.7
Consolidated net (loss) income	(157.5)		(157.8)				(157.8)								0.3
Capped call on conversion of notes	—		—						(30.8)		30.8
Stock-based activity	(1.3)		(1.3)						(6.7)		5.4
Translation adjustments	(17.1)		(17.9)										(17.9)		0.8
Postretirement plans	202.2		202.2										202.2		—
Balance at March 31, 2021	$	(285.8)	$	(331.6)	$	0.7	$	(1,118.3)	$	(151.9)	$	4,693.1	$	(3,755.2)	$	45.8
Consolidated net loss	(142.3)		(140.8)				(140.8)								(1.5)
Stock-based activity	4.5		4.5						(0.2)		4.7
Translation adjustments	16.8		16.4										16.4		0.4
Postretirement plans	143.0		142.7										142.7		0.3
Balance at June 30, 2021	$	(263.8)	$	(308.8)	$	0.7	$	(1,259.1)	$	(152.1)	$	4,697.8	$	(3,596.1)	$	45.0
Consolidated net (loss) income	(18.5)		(18.7)				(18.7)								0.2
Stock-based activity	5.3		5.3						—		5.3
Translation adjustments	(36.5)		(33.9)										(33.9)		(2.6)
Postretirement plans	63.4		61.8										61.8		1.6
Balance at September 30, 2021	$	(250.1)	$	(294.3)	$	0.7	$	(1,277.8)	$	(152.1)	$	4,703.1	$	(3,568.2)	$	44.2

See notes to consolidated financial statements

UNISYS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(Dollars in millions, except share and per share amounts)

Note 1 - Basis of Presentation

The accompanying consolidated financial statements and footnotes of Unisys Corporation have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP). The financial statements and footnotes are unaudited. In the opinion of management, the financial information furnished herein reflects all adjustments necessary for a fair statement of the results of operations, comprehensive income (loss), financial position, cash flows and deficit for the interim periods specified. These adjustments consist only of normal recurring accruals except as disclosed herein. Because of seasonal and other factors, results for interim periods are not necessarily indicative of the results to be expected for the full year.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about future events. These estimates and assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities and the reported amounts of revenue and expenses. Such estimates include the valuation of estimated credit losses, contract assets, operating lease right-of-use assets, outsourcing assets, marketable software, goodwill, purchased intangibles and other long-lived assets, legal contingencies, assumptions used in the calculation for systems integration projects, income taxes and retirement and other post-employment benefits, among others. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. Management adjusts such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ materially from these estimates. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods.

The company’s accounting policies are set forth in detail in Note 1 of the Notes to Consolidated Financial Statements in the company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission. Such Annual Report also contains a discussion of the company’s critical accounting policies and estimates. The company believes that these critical accounting policies and estimates affect its more significant estimates and judgments used in the preparation of the company’s consolidated financial statements.

Note 2 - Accounting Standards

Effective January 1, 2022, the company adopted Accounting Standards Update (ASU) No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This guidance requires that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606, Revenue from Contracts with Customers, as if it had originated the contracts. Deferred revenue acquired in a business combination is no longer required to be measured at its fair value, which had historically resulted in a deferred revenue impairment at the date of acquisition. The company will adopt this guidance for acquisitions completed on or after January 1, 2022.

Note 3 - Acquisitions

On December 14, 2021, the company acquired 100% of CompuGain LLC (CompuGain), a leading cloud solutions provider, for a purchase price consideration of $85.3 million on a cash-free, debt-free basis. The company funded the cash consideration and acquisition-related costs with cash on hand.

The acquisition enhanced the company’s delivery of rapid and agile cloud migration, application modernization and data value realization to our clients.

The fair values of the total net assets acquired was as follows:



Receivables	$	7.8
Prepaid expenses and other current assets	0.7
Properties and other long-term assets	0.2
Operating lease right-of-use assets	0.2
Accounts payable and accruals	(7.4)

Long-term operating lease liabilities	(0.1)
Intangible assets	45.9
Goodwill	38.0
Total	$	85.3

In the second quarter of 2022, the company finalized its valuation of assets acquired and liabilities assumed resulting in measurement period adjustments that decreased goodwill by $27.5 million primarily related to an increase of $27.6 million in the fair value of the acquired intangible assets.

Goodwill is the excess of the purchase price consideration over the fair value of the underlying intangible assets and net liabilities assumed. The goodwill represents expected synergies, intellectual capital and the acquired assembled workforce, none of which qualify for recognition as a separate intangible asset. Goodwill determined by the allocation of the purchase price was recorded in the company’s Cloud, Applications & Infrastructure Solutions segment and is deductible for tax purposes.

The following table summarizes the fair value of the intangible assets acquired and the related weighted average amortization period:


	Weighted Average Amortization Period in Years	Fair Value

Customer relationships	12.0	$	44.6
Trademark	4.0	1.3
Total		$	45.9

The company’s consolidated financial statements include the results of CompuGain commencing as of the acquisition date. Revenue and earnings for CompuGain have not been presented as the impact is not material to the company’s consolidated financial statements.

For the nine months ended September 30, 2022, the company incurred and expensed acquisition-related costs of $0.4 million, Acquisition-related costs are included within selling, general and administrative expenses on the consolidated statements of income (loss).

Note 4 - Cost-Reduction Actions

During the three months ended September 30, 2022, the company recognized cost-reduction charges and other costs of $8.1 million. The charges related to work-force reductions were $0.5 million for changes in estimates. In addition, the company recorded charges of $7.6 million comprised of $1.9 million for net foreign currency losses related to exiting foreign countries, $4.7 million for asset impairments and $1.0 million for other expenses related to cost-reduction efforts.

During the three months ended September 30, 2021, the company recognized net cost-reduction charges and other costs of $0.8 million. The net credits related to work-force reductions were $0.6 million, principally related to severance costs, and were comprised of: (a) a charge of $0.7 million and (b) a credit of $1.3 million for changes in estimates. In addition, the company recorded net charges of $1.4 million comprised of a charge of $1.3 million for net foreign currency losses related to exiting foreign countries, a charge of $0.5 million for asset impairments and a credit of $0.4 million related to other cost-reduction efforts.

During the nine months ended September 30, 2022, the company recognized net cost-reduction charges and other costs of $14.2 million. The credit related to work-force reductions was $0.4 million for changes in estimates. In addition, the company recorded charges of $14.6 million comprised of $4.8 million for net foreign currency losses related to exiting foreign countries, $9.4 million for asset impairments and a net charge of $0.4 million for other expenses related to cost-reduction efforts.

During the nine months ended September 30, 2021, the company recognized net cost-reduction charges and other costs of $14.4 million. The net credits related to work-force reductions were $2.5 million, principally related to severance costs, and were comprised of: (a) a charge of $6.5 million and (b) a credit of $9.0 million for changes in estimates. In addition, the company recorded charges of $16.9 million comprised of $2.9 million for net foreign currency losses related to exiting foreign countries, $7.3 million for asset impairments and $6.7 million for other expenses related to cost-reduction efforts.

The charges (credits) were recorded in the following statement of income (loss) classifications:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Cost of revenue	$	3.9	$	(0.2)	$	7.4	$	0.9
Selling, general and administrative	2.4		(0.1)		2.2		8.7
Research and development	(0.1)		(0.2)		(0.2)		1.9
Other (expense), net	1.9		1.3		4.8		2.9
Total	$	8.1	$	0.8	$	14.2	$	14.4

Liabilities and expected future payments related to the company’s work-force reduction actions are as follows:


	Total		U.S.		International
Balance at December 31, 2021	$	16.3	$	5.7	$	10.6

Payments	(8.6)		(3.4)		(5.2)
Changes in estimates	(0.4)		(1.0)		0.6
Translation adjustments	(1.0)		—		(1.0)
Balance at September 30, 2022	$	6.3	$	1.3	$	5.0
Expected future utilization on balance at September 30, 2022:
Short-term	$	6.3	$	1.3	$	5.0

Note 5 - Pension and Postretirement Benefits

Net periodic pension expense (income) is presented below:


	Three Months Ended September 30, 2022						Three Months Ended September 30, 2021
	Total		U.S. Plans		International Plans		Total		U.S. Plans		International Plans
Service cost(i)	$	0.4	$	—	$	0.4	$	0.7	$	—	$	0.7
Interest cost	38.2		28.7		9.5		38.2		29.4		8.8
Expected return on plan assets	(66.1)		(47.4)		(18.7)		(69.8)		(50.0)		(19.8)
Amortization of prior service benefit	(1.2)		(0.6)		(0.6)		(1.3)		(0.7)		(0.6)
Recognized net actuarial loss	40.5		31.4		9.1		45.8		34.0		11.8

Net periodic pension expense (income)	$	11.8	$	12.1	$	(0.3)	$	13.6	$	12.7	$	0.9


	Nine Months Ended September 30, 2022						Nine Months Ended September 30, 2021
	Total		U.S. Plans		International Plans		Total		U.S. Plans		International Plans
Service cost(i)	$	1.4	$	—	$	1.4	$	2.4	$	—	$	2.4
Interest cost	116.2		86.0		30.2		116.2		88.2		28.0
Expected return on plan assets	(201.8)		(142.3)		(59.5)		(212.3)		(149.9)		(62.4)
Amortization of prior service benefit	(3.8)		(1.9)		(1.9)		(4.0)		(1.9)		(2.1)
Recognized net actuarial loss	123.3		94.4		28.9		138.6		101.8		36.8
Settlement losses (ii) (iii)	—		—		—		368.7		158.0		210.7
Net periodic pension expense (income)	$	35.3	$	36.2	$	(0.9)	$	409.6	$	196.2	$	213.4


(i)Service cost is reported in selling, general and administrative expense. All other components of net periodic pension expense (income) are reported in other (expense), net in the consolidated statements of income (loss).
(ii)In the second quarter of 2021, the company’s primary pension plan related to its Dutch subsidiary was transferred to a multi-client circle within a multi-employer fund. This action resulted in a pre-tax settlement loss of $182.6 million for the nine months ended September 30, 2021. Additionally, the company’s Swiss subsidiary transferred its defined benefit pension plans to a multiple-employer collective foundation. This action resulted in a pre-tax settlement loss of $28.1 million for the nine months ended September 30, 2021.
(iii)In January 2021, the company purchased a group annuity contract to transferred projected benefit obligations related to its U.S. defined benefit pension plans. This action resulted in a pre-tax settlement loss of $158.0 million for the nine months ended September 30, 2021.

In 2022, the company expects to make cash contributions of approximately $38.5 million primarily for the company’s international defined benefit pension plans. In 2021, the company made cash contributions of $52.4 million to its worldwide defined benefit pension plans. During the nine months ended September 30, 2022 and 2021, the company made cash contributions of $30.9 million and $40.3 million, respectively.

At the end of each year, the company estimates its future cash contributions to its U.S. qualified defined benefit pension plans based on year-end pension data and assumptions. Any material deterioration in the value of the company’s U.S. qualified defined benefit pension plan assets, as well as changes in pension legislation, discount rate changes, asset return changes, or changes in economic or demographic trends, could require the company to make cash contributions to its U.S. defined benefit pension plans.

Net periodic postretirement benefit income is presented below:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Service cost(i)	$	0.1	$	0.1	$	0.2	$	0.3
Interest cost	0.4		0.5		1.4		1.3
Expected return on assets	—		(0.1)		(0.2)		(0.3)
Recognized net actuarial gain	(0.5)		(0.7)		(1.5)		(2.0)
Amortization of prior service cost	(0.4)		(0.4)		(1.1)		(1.2)
Net periodic postretirement benefit income	$	(0.4)	$	(0.6)	$	(1.2)	$	(1.9)


(i)