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Operating leases
9 Months Ended
Sep. 28, 2024
Leases [Abstract]  
Operating leases Operating leases
The Company leases certain warehouses, equipment, vehicles, and office space primarily through operating lease agreements. The Company recorded operating lease costs of $5 million and $12 million for the quarter and year-to-date period ended September 28, 2024, respectively. Operating lease costs for the quarter and year-to-date period ended September 30, 2023 were immaterial to the consolidated financial statements.
Quarter endedYear-to-date period ended
(millions)September 28, 2024September 30, 2023September 28, 2024September 30, 2023
Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$$— $$— 
Right-of-use assets obtained in exchange for operating lease liabilities
New leases$35 $— $87 $— 
Modified leases$— $— $— $— 
At September 28, 2024 future maturities of operating leases were as follows:
(millions)Operating
leases
2024 (remaining)$
202522 
202621 
202720 
202819 
2029 and beyond28 
Total minimum payments$116 
Less interest(15)
Present value of lease liabilities$101 
Weighted-average remaining lease term - operating leases5.4 years
Weighted-average discount rate - operating leases6.2%
During each of the first three quarters of 2024, the Company entered into lease agreements with unrelated third parties for distribution centers previously leased by Kellanova. The leases were either transferred to the Company or subleased directly from Kellanova as outlined in the Separation and Distribution Agreement. Payments for these leases are made on a monthly basis. Prior to the execution of these leases, use of the distribution centers was managed under the Transition Services Agreement.
The new sublease agreement executed in the third quarter of 2024 resulted in an increase to operating lease assets of $34 million, which is recorded within Operating lease assets on the Unaudited Consolidated Balance Sheet. This also resulted in an increase to operating lease liabilities of $34 million, of which $4 million is classified as short-term and included in Other current liabilities and $30 million is classified as Long-term operating lease obligations on the Unaudited Consolidated Balance Sheet.
For the year-to-date period ended September 28, 2024, the effect of the new lease agreements resulted in an increase to operating lease assets of $82 million, which is recorded within Operating lease assets on the Unaudited Consolidated Balance Sheet. These leases also resulted in an increase to operating lease liabilities of $82 million, of which $9 million is classified as short-term and included in Other current liabilities and $73 million is classified as Long-term operating lease obligations on the Unaudited Consolidated Balance Sheet.