Keystone Consolidated Industries Inc has reported net income of USD 9 million in the second quarter of 2011 as compared to net income of USD 6.7 million in the second quarter of 2010. The increase in net income was primarily due to a USD 3.5 million higher defined benefit pension credit during the second quarter of 2011.
Because the amount of the company's net periodic defined benefit pension and other postretirement benefit expense or credits are unrelated to the ongoing operating activities of the company, Keystone measures its overall operating performance using operating income before pension and OPEB expense or credits.
| Item | Q2 '10 | Q2 '11 | Change |
| Operating income as reported | 11,480 | 14,841 | 29.3 |
| Defined benefit pension credit | -1,209 | -4,750 | 292.9 |
| OPEB credit | -1,345 | -1,299 | -3.4 |
| Operating income before pension and OPEB | 8,926 | 8,792 | -1.5 |
In '000 USD
Operating income before pension and OPEB for the second quarter of 2011 approximated prior year as a higher margin between selling prices and raw material costs during the 2011 second quarter was offset by increased costs of production due to outages related to malfunctioning equipment and unfavorable LIFO adjustments.
Primarily due to an USD 86 million increase in Keystone's pension plans' assets during 2010, the company currently expects to record a defined benefit pension credit of USD 19.0 million during 2011 as compared to the USD 4.7 million defined benefit pension credit recorded during 2010.
Accordingly, Keystone recorded a defined benefit pension credit of USD 4.8 million during the second quarter of 2011 as compared to the USD 1.2 million credit recorded during the second quarter of 2010.
