Renold has reported a £4.8m annual increase in its pension deficit to £102.4m due to a rise in liabilities from its UK scheme in its results for the year ended 31 March 2021.

The company, which is an international supplier of industrial chains and related power transmission products, showed that the total deficit increase was accounted for by the UK scheme’s £9.5m increase in deficit to £77.5m.

However, the impact of this was slightly offset by the German scheme’s deficit falling from £29.6m to £24.9m.

Renold’s UK scheme assets increased from £128.9m to £136.3m during the 12-month period, although this was overshadowed by liabilities from the scheme jumping from £196.9m to £213.8m.

The company attributed the rise in the UK scheme’s deficit to a reduction in AA corporate bond yields, while it said the German scheme’s reduction was a reflection of changes in assumptions for discount and inflation rates.

Both of these defined benefit schemes are closed to future accrual.

Renold reported that it had recommenced pension contributions on 31 March 2021 following a deferral of contributions to its UK pension fund for 12 months, one of a number of measures taken in anticipation of falling demand in 2020 as the company sought to reduce costs and preserve cash flow.

The deferred contributions, which amount to £2.8m, will be repaid over a five-year period commencing on 1 April 2022 under an agreement with the scheme’s trustees.

This agreement resulted in the company’s pension cash costs dropping from £4.4m to £2.1m.

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