Leases

12 Months Ended

Dec. 31, 2020

The Company has operating leases of real estate, consisting primarily of administrative offices, manufacturing and distribution facilities, and R&D facilities. We also have operating leases of certain equipment, primarily automobiles, and certain limited supply arrangements.

As of December 31, 2020, the Company recognized a ROU asset of $323.6 million and a total lease liability of $322.4 million. The Company’s ROU assets are recorded in other assets. The related lease liability balances are recorded in other current liabilities and other long-term obligations in the consolidated balance sheets. Refer to Note 5 Balance Sheet Components for additional information.

ROU assets and liabilities are recognized at the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use an applicable incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. Options to extend or terminate the ROU assets are reviewed at lease inception and these options are accounted for when they are reasonably certain of being exercised.

Other information related to leases was as follows:


	As of December 31, 2020
Remaining lease terms	1 year to 25 years
Weighted-average remaining lease term	7 years
Weighted-average discount rate	3.1	%

As of December 31, 2020, maturities of lease liabilities were as follows:


(In millions)
Year ending December 31,
2021	89.9
2022	68.0
2023	46.6
2024	34.6
2025	27.7
Thereafter	95.1
	$	361.9

As of December 31, 2020, we have additional operating leases, primarily for production and distribution facilities, that have not yet commenced totaling approximately $18.7 million. These leases are expected to commence in 2021 and have lease terms of 4 years to 9 years. For the years ended December 31, 2020, 2019 and 2018, the Company had operating lease expense of approximately $80.7 million, $87.6 million and $78.9 million, respectively. Operating lease costs are classified primarily as selling, general and administrative expenses and cost of sales.