Leases

12 Months Ended

May 31, 2023

Leases

Leases

11. Leases

We lease facilities, offices, vehicles, and equipment. We determine at inception whether an arrangement that provides us control over the use of an asset is a lease. ROU assets and lease liabilities are recognized on the Consolidated Balance Sheets at lease commencement date based on the present value of the future minimum lease payments over the lease term. Our lease agreements do not provide a readily determinable implicit rate nor is it available to us from our lessors. We estimate our incremental borrowing rate based on information available at lease commencement in order to discount lease payments to present value.

Our lease costs are allocated over the remaining lease term on a straight-line basis unless another systematic or rational basis is more representative of the pattern in which the underlying asset is expected to be used. Variable lease costs are expensed in the period in which the obligation for those payments are incurred. ROU assets are evaluated for impairment in a manner consistent with the treatment of other long-lived assets. We elected the practical expedients to not separate lease and non-lease components for both lessee and lessor relationships and to not apply the recognition requirements to leases with terms of twelve months or less.

Certain leases include options to renew or extend the terms of the lease, which are included in the determination of the ROU assets and lease liabilities when it is reasonably certain that the option will be exercised. Our leases may also include variable lease payments such as escalation clauses based on consumer price index rates, maintenance costs and utilities. Variable lease payments that depend on an index or a rate are included in the determination of ROU assets and lease liabilities using the index or rate at the lease commencement date, whereas variable lease payments that do not depend on an index or rate are recorded as lease expense in the period incurred. Our lease agreements do not contain any significant residual value guarantees or restrictive covenants.

The summary of our operating lease cost is as follows:

	For the Year Ended May 31,
	2023		2022		2021
Operating lease cost	$	20.3	$	20.8	$	16.4
Short-term lease cost		5.9		2.2		1.7
Variable lease cost		3.2		9.2		3.5
	$	29.4	$	32.2	$	21.6

With the exception of a land lease for one of our airframe maintenance facilities that expires in 2108, our operating leases expire at various dates through 2034. Maturities of our operating lease payments as of May 31, 2023 are as follows:

2024	$	14.5
2025		12.3
2026		9.1
2027		8.4
2028		7.8
Thereafter		17.6
Total undiscounted payments		69.7
Less: Imputed interest		(9.2)
Present value of minimum lease payments		60.5
Less: Operating lease liabilities – current		(12.3)
Operating lease liabilities – non-current	$	48.2

The current portion of operating lease liabilities are presented within Accrued liabilities on our Consolidated Balance Sheets.

Excluding leases related to our discontinued operations, our weighted-average remaining lease term and weighted-average discount rate are as follows:

	May 31,
	2023	2022
Remaining lease term	6.9 years	7.6 years
Discount rate	3.8%	3.7%

Supplemental cash flow information related to leases was as follows:

	For the Year Ended May 31,
	2023		2022		2021
Cash paid for amounts included in the measurement of lease liabilities	$	14.5	$	14.1	$	15.3
Operating lease liabilities arising from obtaining ROU assets		4.5		9.5		5.2