Leases

9 Months Ended

Apr. 30, 2020

The Company leases certain real estate properties, information technology equipment, manufacturing and warehouse equipment, vehicles and other equipment through operating lease arrangements. The Company determines whether an arrangement that provides control over the use of an asset to the Company is a lease. The Company recognizes a lease liability and corresponding right-of-use asset on the Condensed Consolidated Balance Sheets based on the present value of future lease payments, and recognizes lease expense on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the Condensed Consolidated Balance Sheets.

The Company has elected to separate payments for lease components from non-lease components for all asset classes. Lease agreements may include extension, termination or purchase options, all of which are considered in calculating the lease liability and right-of-use assets when it is reasonably certain the Company will exercise the option. Most lease agreements do not explicitly state the discount rate implicit in the lease, therefore, the Company’s incremental borrowing rate on the commencement date is used to calculate the present value of future payments for most leases.

The Company has elected to exercise the package of practical expedients and has not elected to exercise hindsight in determining lease term and in assessing impairment of the Company’s right-of-use assets. The Company’s finance leases are not significant and therefore, are not included in the following disclosures. Information for the Company’s operating lease costs is as follows (in millions):


	Three Months Ended April 30,		Nine Months Ended April 30,
	2020		2020
Operating lease cost	$	7.5	$	22.7
Short-term lease cost	0.5		1.6
Total lease costs	$	8.0	$	24.3

Supplemental balance sheet information for the Company is as follows (in millions):


	April 30, 2020		August 1, 2019
Right-of-use lease assets	$	71.4	$	71.5
Current lease liabilities	$	24.0	$	26.0
Long-term lease liabilities	$	47.4	$	45.5

Additional information related to operating leases is as follows:


	April 30, 2020		August 1, 2019
Weighted average remaining lease term (years)	5.0		3.7
Weighted average discount rates	3.57	%	3.76	%

Payments for operating leases having initial terms of more than one year at April 30, 2020 were as follows (in millions):


Amounts Due in Fiscal Year Ending	April 30, 2020
Remainder of 2020	$	7.2
2021	23.4
2022	15.3
2023	9.0
2024	5.8
Thereafter	17.8
Total future lease payments	78.5
Less imputed interest	7.1
Present value of future lease payments	$	71.4

Payments for operating leases having initial terms of more than one year at July 31, 2019 were as follows (in millions):


Amounts Due in Fiscal Year Ending	July 31, 2019
2020	$	24.0
2021	17.5
2022	11.3
2023	6.4
2024	4.6
Thereafter	19.0
Total future lease payments	$	82.8

Right-of-use lease assets obtained in exchange for new lease liabilities were $23.3 million for the nine months ended April 30, 2020.