Expected rate of return on plan assets for determining net periodic pension cost

THE COOPER COMPANIES, INC. AND SUBSIDIARIESNotes to Consolidated Condensed Financial Statements(Unaudited)The Company's results of operations for the three and six months ended April 30, 2022, and 2021, reflect the following components of net periodic defined benefit costs:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Periods Ended April 30, | Three Months |  | Six Months |
| (In millions) | 2022 |  | 2021 |  | 2022 |  | 2021 |
| Service cost | $ | 4.6  |  |  | $ | 4.3  |  |  | $ | 9.2  |  |  | $ | 8.6  |  |
| Interest cost | 1.3  |  |  | 1.1  |  |  | 2.6  |  |  | 2.2  |  |
| Expected return on plan assets | (3.9) |  |  | (3.1) |  |  | (7.9) |  |  | (6.2) |  |
|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
| Recognized net actuarial gain | 0.6  |  |  | 1.3  |  |  | 1.2  |  |  | 2.7  |  |
| Net periodic defined benefit plan cost | $ | 2.6  |  |  | $ | 3.6  |  |  | $ | 5.1  |  |  | $ | 7.3  |  |

The Company has not determined how much it expects to contribute to the Plan and did not contribute to the Plan in the first half of fiscal 2022. The Company did not contribute to the Plan in the first half of fiscal 2021. The expected rate of return on Plan assets for determining net periodic benefit plan cost is 8%.  
Note 12. Contingencies  
The Company is involved in various lawsuits, claims and other legal matters from time to time that arise in the ordinary course of conducting business, including matters involving our products, intellectual property, supplier relationships, distributors, competitor relationships, employees and other matters. The Company does not believe that the ultimate resolution of these proceedings or claims pending against it could have a material adverse effect on its financial condition or results of operations. At each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under ASC 450, Contingencies. Legal fees are expensed as incurred.  
Note 13. Business Segment InformationThe Company discloses information about its operating segments, which were established based on the way that management organizes segments within the Company for making operating decisions and assessing financial performance. The Company's two operating segments are described below. •CooperVision. Competes in the worldwide contact lens market by developing, manufacturing and marketing a broad range of products for contact lens wearers, featuring advanced materials and optics. CooperVision designs its products to solve vision challenges such as astigmatism, presbyopia, myopia, ocular dryness and eye fatigues, with a broad collection of spherical, toric and multifocal contact lenses.•CooperSurgical. Competes in the general health care market with a focus on advancing the health of women, babies and families through a diversified portfolio of products and services focusing on women's health and fertility.The Company has 50% ownership in the new joint venture and accounts for this investment under the equity method of accounting. This joint venture is not considered material to the overall results of the Company and is grouped under CooperVision segment.The Company uses operating income, as presented in our financial reports, as the primary measure of segment profitability. The Company does not allocate costs from corporate functions to segment operating income. Items below operating income are not considered when measuring the profitability of a segment. The Company uses the same accounting policies to generate segment results as the Company does for consolidated results.Total identifiable assets are those used in continuing operations except cash and cash equivalents, which the Company includes as corporate assets. 20
