LEASES

9 Months Ended

Sep. 30, 2022

Note 2: Leases

Our portfolio of nonmineral leases is composed of leases for real estate (including office buildings, aggregates sales yards and terminals, and concrete and asphalt sites) and equipment (including railcars and rail track, barges, and office, plant and mobile equipment).

Lease right-of-use (ROU) assets and liabilities and the weighted-average lease terms and discount rates are as follows:



		September 30	December 31	September 30
dollars in millions	Classification on the Balance Sheet	2022	2021	2021
Assets ¹
Operating lease ROU assets		$ 778.8	$ 771.1	$ 728.8
Accumulated amortization		(89.6)	(79.7)	(71.9)
Operating leases, net	Operating lease right-of-use assets, net	689.2	691.4	656.9
Finance lease assets		111.2	129.2	125.6
Accumulated depreciation		(12.6)	(8.8)	(5.0)
Finance leases, net	Property, plant & equipment, net	98.6	120.4	120.6
Total lease assets		$ 787.8	$ 811.8	$ 777.5
Liabilities ¹
Current
Operating	Other current liabilities	$ 51.9	$ 49.2	$ 48.7
Finance	Other current liabilities	27.7	35.4	38.4
Noncurrent
Operating	Noncurrent operating lease liabilities	643.3	642.5	622.3
Finance	Other noncurrent liabilities	45.9	60.5	63.2
Total lease liabilities		$ 768.8	$ 787.6	$ 772.6
Lease Term and Discount Rate
Weighted-average remaining lease term (years)
Operating leases		20.1	21.0	21.0
Finance leases		3.1	3.3	3.4
Weighted-average discount rate
Operating leases		3.7%	3.8%	3.9%
Finance leases		1.6%	1.3%	1.2%


¹	Includes lease assets and liabilities that are classified as held for sale as detailed in Note 16.

Our lease agreements do not contain residual value guarantees, restrictive covenants or early termination options that we deem material. We have not sought or been granted any material lease concessions as a result of the COVID-19 pandemic.

The components of lease expense are as follows:



	Three Months Ended		Nine Months Ended
	September 30		September 30
in millions	2022	2021	2022	2021
Lease Cost
Finance lease cost
Depreciation of right-of-use assets	$ 4.2	$ 0.8	$ 12.9	$ 2.2
Interest on lease liabilities	0.2	0.2	0.9	0.2
Operating lease cost	21.7	18.4	65.6	49.2
Short-term lease cost ¹	12.3	7.7	32.8	17.9
Variable lease cost	4.7	2.2	8.9	7.7
Sublease income	(0.6)	(0.6)	(2.2)	(2.4)
Total lease cost	$ 42.5	$ 28.7	$ 118.9	$ 74.8


¹	Our short-term lease cost includes the cost of leases with an initial term of one year or less (including those with terms of one month or less).

Cash paid for operating leases was $60.0 million and $44.6 million for the nine months ended September 30, 2022 and 2021, respectively. Cash paid for finance leases (principal and interest) was $28.0 million and $4.8 million for the nine months ended September 30, 2022 and 2021, respectively.