Leases

9 Months Ended

Sep. 30, 2022

Leases

Leases

21.    Leases

The Company enters into commercial leases for various auctions sites and offices, the majority of which are non-cancellable, and additional operating leases for computer equipment, motor vehicles and small office equipment. The majority of the Company’s operating leases have a fixed term with a remaining life between one month and 18 years, with renewal options included in the contracts. The leases have varying contract terms, escalation clauses and renewal options.

The Company also enters into finance lease arrangements for certain vehicles, computer and yard equipment and office furniture, the majority of these leases have a fixed term with a remaining life of one month to six years with renewal options included in the contracts.

On March 17, 2022, the Company completed the sale and leaseback of its Bolton property, a parcel of land including all buildings, in Bolton, Ontario (Note 15). The Company intends to lease the Bolton property for a period of 28 months until such time that the replacement property is available for the relocation of the Company’s operations. The lease has an initial rent-free period of two years and an option to renew the lease for two additional one-year periods, during which time the lease is cancellable at one month’s notice. Upon completion of the sale, the Company recorded a $16.6 million ROU asset representing the right-of-use of the Bolton property for the estimated lease term and a $4.5 million long term lease liability representing the obligation to make lease payments arising from the operating lease at the end of the initial two-year period.

On June 30, 2022, the Company also recorded $9.0 million in ROU asset and a long term lease liability relating to a lease signed on its Maltby auction site in the United Kingdom. On September 28, 2022, the Company completed the purchase of the Maltby property for a purchase price of $13.5 million and as a result derecognized the ROU asset and long term lease liability (Note 16).

The Company’s breakdown of lease expense is as follows:

	Three months ended				Nine months ended
	September 30,				September 30,
	2022		2021		2022		2021
Operating lease cost	$	6,135	$	4,592	$	17,075	$	13,584
Finance lease cost
Amortization of leased assets		2,457		2,693		7,705		8,096
Interest on lease liabilities		202		196		562		622
Short-term lease cost		2,818		2,845		9,182		7,428
Sublease income		—		(15)		—		(45)
	$	11,612	$	10,311	$	34,524	$	29,685