Leases

12 Months Ended

Feb. 28, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments And Guarantees

Accounting Policies

In Q1 2020, we adopted ASU 2016-02, Leases (Topic 842), and related amendments ("ASC 842") using the modified retrospective approach. The effects of the initial application of ASC 842 did not result in a cumulative adjustment to retained earnings.

We have operating leases for corporate offices, sales offices, showrooms, manufacturing facilities, vehicles and equipment that expire at various dates through 2031. Certain lease agreements include contingent rental payments based on per unit usage over contractual levels (e.g., miles driven or machine hours used) and others include rental payments adjusted periodically for inflationary indexes. Additionally, some leases include options to renew or terminate the leases which can be exercised at our discretion. The lease terms utilized in determining right-of-use assets and lease liabilities include the noncancellable portion of the underlying leases along with any reasonably certain lease periods associated with available renewal periods. Our leases do not contain any residual value guarantees or material restrictive covenants. As most of our leases do not provide an implicit discount rate, we use an estimated incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. The estimated incremental borrowing rate represents the estimated rate of interest we would have had to pay to borrow on a collateralized basis an amount equal to the lease payments for a similar period of time.

The components of lease expense are as follows:

	Twelve Months Ended
	February 28, 2020
Operating lease cost	$	51.9
Sublease rental income	(1.2		)
	$	50.7

Supplemental cash flow and other information related to leases are as follows:

	Twelve Months Ended
	February 28, 2020
Cash flow information:
Operating cash flows used for operating leases	$	45.3
Leased assets obtained in exchange for new operating lease obligations	$	103.6

	February 28, 2020
Other information:
Weighted-average remaining term	7.1 years
Weighted-average discount rate	4.0	%

The following table summarizes the future minimum lease payments as of February 28, 2020:

Fiscal year ending in February	Amount (1)
2021	$	50.6
2022	47.2
2023	40.8
2024	35.3
2025	33.0
Thereafter	89.8
Total lease payments	296.7
Less interest	39.6
Present value of lease liabilities	$	257.1

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(1) Lease payments include options to extend lease terms that are reasonably certain of being exercised. The payments exclude legally binding minimum lease payments for leases signed but not yet commenced.

The following table summarizes future minimum lease payments as of February 22, 2019, before adoption of ASC 842:

Fiscal Year Ending in February	Minimum annual rental commitments		Minimum annual sublease rental income			Minimum annual rental commitments, net
2020	$	46.0	$	(0.6	)	$	45.4
2021	41.7		(0.3		)	41.4
2022	40.5		(0.2		)	40.3
2023	36.5		(0.2		)	36.3
2024	28.0		(0.2		)	27.8
Thereafter	72.2		(0.6		)	71.6
	$	264.9	$	(2.1	)	$	262.8

Practical Expedients Elected    

We elected the following practical expedients as a result of adopting ASC 842:

• We elected not to separate non-lease components of a contract from the lease components to which they relate for all classes of lease assets except for embedded leases, which were immaterial in 2020.

• We elected the package of practical expedients available for transition which allowed us not to reassess (1) whether previously assessed contracts contain leases, (2) the classification of the leases as operating or finance and (3) the amount of initial direct costs associated with the leases.

• We elected not to recognize a right-of-use asset or lease liability for short-term leases that have a lease term of 12 months or less.

• We elected not to assess whether land easements that were not previously accounted for as leases are or contain a lease.

•

We elected not to use hindsight in determining the lease term and in assessing the likelihood that a lessee purchase option will be exercised.