Leases (Tables)
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12 Months Ended |
Jan. 30, 2021 |
Leases |
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Summary of Lease Costs-Net |
Lease costs—net consist of the following (in thousands): | | | | | | | | | | | | YEAR ENDED | | | JANUARY 30, | | FEBRUARY 1, | | FEBRUARY 2, | | | 2021 | | 2020 | | 2019 | Operating lease cost (1) | | $ | 84,852 | | $ | 86,448 | | $ | 87,742 | Finance lease costs | | | | | | | | | | Amortization of leased assets (1) | | | 41,292 | | | 36,991 | | | 28,848 | Interest on lease liabilities (2) | | | 24,011 | | | 22,608 | | | 16,785 | Variable lease costs (3) | | | 20,485 | | | 23,471 | | | 21,889 | Sublease income (4) | | | (7,723) | | | (9,609) | | | (7,794) | Total lease costs—net | | $ | 162,917 | | $ | 159,909 | | $ | 147,470 |
(1) | Operating lease costs and amortization of finance lease right-of-use assets are included in cost of goods sold or selling, general and administrative expenses on the consolidated statements of income based on our accounting policy. Refer to Note 3—Significant Accounting Policies. |
(2) | Included in interest expense—net on the consolidated statements of income. |
(3) | Represents variable lease payments under operating and finance lease agreements, primarily associated with contingent rent based on a percentage of retail sales over contractual levels of $13.4 million, $14.6 million and $13.0 million, respectively, and charges associated with common area maintenance of $7.1 million, $8.9 million and $8.9 million in fiscal 2020, fiscal 2019 and fiscal 2018, respectively. Other variable costs include single lease cost related to variable lease payments based on an index or rate that were not included in the measurement of the initial lease liability and right-of-use asset were not material in fiscal 2020, fiscal 2019 and fiscal 2018. |
(4) | Included as an offset to selling, general and administrative expenses on the consolidated statements of income. |
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Summary of Lease Right-of-use Assets and Lease Liabilities |
Lease right-of-use assets and lease liabilities consist of the following (in thousands): | | | | | | | | | | | | | JANUARY 30, | | FEBRUARY 1, | | | | | 2021 | | 2020 | | | Balance Sheet Classification | | | | | | | Assets | | | | | | | | | Operating leases | | Operating lease right-of-use assets | | $ | 456,164 | | $ | 410,904 | Finance leases (1)(2) | | Property and equipment—net | | | 711,804 | | | 642,117 | Total lease right-of-use assets | | | | $ | 1,167,968 | | $ | 1,053,021 | Liabilities | | | | | | | | | Current (3) | | | | | | | | | Operating leases | | Operating lease liabilities | | $ | 71,524 | | $ | 58,924 | Finance leases | | Other current liabilities | | | 14,671 | | | 9,188 | Total lease liabilities—current | | | | | 86,195 | | | 68,112 | Non-current | | | | | | | | | Operating leases | | Non-current operating lease liabilities | | | 448,169 | | | 409,930 | Finance leases | | Non-current finance lease liabilities | | | 485,481 | | | 442,988 | Total lease liabilities—non-current | | | | | 933,650 | | | 852,918 | Total lease liabilities | | | | $ | 1,019,845 | | $ | 921,030 |
(1) | Finance lease right-of-use assets include capitalized amounts related to our completed construction activities to design and build leased assets, which are reclassified from other non-current assets upon lease commencement. |
(2) | Finance lease right-of-use assets are recorded net of accumulated amortization of $133.0 million and $92.3 million as of January 30, 2021 and February 1, 2020, respectively. |
(3) | Current portion of lease liabilities represents the reduction of the related lease liability over the next 12 months. |
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Summary of Maturities of Lease Liabilities |
The maturities of lease liabilities are as follows as of January 30, 2021 (in thousands): | | | | | | | | | | | | | | | | OPERATING | | FINANCE | | | FISCAL YEAR | | | | LEASES | | LEASES | | TOTAL | 2021 | | | | $ | 90,361 | | $ | 38,786 | | $ | 129,147 | 2022 | | | | | 79,294 | | | 39,203 | | | 118,497 | 2023 | | | | | 71,580 | | | 39,613 | | | 111,193 | 2024 | | | | | 65,332 | | | 39,984 | | | 105,316 | 2025 | | | | | 64,984 | | | 41,173 | | | 106,157 | Thereafter | | | | | 251,637 | | | 594,460 | | | 846,097 | Total lease payments (1)(2) | | | | | 623,188 | | | 793,219 | | | 1,416,407 | Less—imputed interest (3) | | | | | (103,495) | | | (293,067) | | | (396,562) | Present value of lease liabilities | | | | $ | 519,693 | | $ | 500,152 | | $ | 1,019,845 |
(1) | Total lease payments include future obligations for renewal options that are reasonably certain to be exercised and are included in the measurement of the lease liability. Total lease payments exclude $793.5 million of legally binding payments under the non-cancellable term for leases signed but not yet commenced under our accounting policy as of January 30, 2021, of which $28.3 million, $38.9 million, $43.9 million, $45.6 million and $47.1 million will be paid in fiscal 2021, fiscal 2022, fiscal 2023, fiscal 2024 and fiscal 2025, respectively, and $589.7 million will be paid subsequent to fiscal 2025. |
(2) | Excludes future commitments under short-term lease agreements of $0.7 million as of January 30, 2021. |
(3) | Calculated using the discount rate for each lease at lease commencement. |
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Summary of Supplemental Information Related to Leases |
Supplemental information related to leases consists of the following: | | | | | | | | | JANUARY 30, | | FEBRUARY 1, | | | 2021 | | 2020 | Weighted-average remaining lease term (years) | | | | | | | Operating leases | | | 8.7 | | | 8.9 | Finance leases | | | 18.4 | | | 18.6 | Weighted-average discount rate | | | | | | | Operating leases | | | 3.97% | | | 3.82% | Finance leases | | | 5.04% | | | 5.25% |
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Summary of Other Information Related to Leases |
Other information related to leases consists of the following (in thousands): | | | | | | | | | | | | YEAR ENDED | | | JANUARY 30, | | FEBRUARY 1, | | FEBRUARY 2, | | | 2021 | | 2020 | | 2019 | Cash paid for amounts included in the measurement of lease liabilities | | | | | | | | | | Operating cash flows from operating leases | | $ | (75,794) | | $ | (95,329) | | $ | (91,965) | Operating cash flows from finance leases | | | (20,839) | | | (25,260) | | | (16,785) | Financing cash flows from finance leases | | | (12,498) | | | (9,682) | | | (6,885) | Total cash outflows from leases | | $ | (109,131) | | $ | (130,271) | | $ | (115,635) | Lease right-of-use assets obtained in exchange for lease obligations—net of lease terminations (non-cash) | | | | | | | | | | Operating leases | | $ | 113,828 | | $ | 34,063 | | $ | 174,977 | Finance leases | | | 57,873 | | | 42,122 | | | 33,790 |
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