Leases

12 Months Ended

Mar. 02, 2024

We have operating leases for certain of the buildings and equipment used in our operations. We determine if an arrangement contains a lease at inception. Under ASU 2016-20, Leases, we have elected the package of practical expedients permitted under the transition guidance in adopting ASC 842, which, among other things, allowed us to carry forward our historical lease classification. Operating lease assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Lease expense is recognized on a straight-line basis over the lease term. Our leases have remaining lease terms of one to ten years, some of which include renewal options that can extend the lease for up to an additional ten years, at our sole discretion. We have made an accounting policy election not to record leases with an original term of twelve months or less on our consolidated balance sheet; such leases are expensed on a straight-line basis over the lease term. As of March 2, 2024, we have one additional future operating lease commitment of $13.7 million that is signed but has not yet commenced, for one facility located in Texas within our Architectural Services Segment.

In determining lease asset value, we consider fixed or variable payment terms, prepayments, incentives, and options to extend, terminate or purchase. Renewal, termination or purchase options affect the lease term used for determining lease asset value only if the option is reasonably certain to be exercised. We use a discount rate for each lease based upon an estimated incremental borrowing rate over a similar term. We have elected the practical expedient to account for lease and non-lease components (e.g., common-area maintenance costs) as a single lease component. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The components of lease expense were as follows:


(In thousands)	March 2, 2024		February 25, 2023
Operating lease cost	$	14,312	$	12,336
Short-term lease cost	1,349		1,579
Variable lease cost	2,629		3,487
Sublease income	(1,479)		(671)
Total lease cost	$	16,811	$	16,731

Other supplemental information related to leases are as follows:


(In thousands)	March 2, 2024			February 25, 2023

Cash paid for amounts included in the measurement of operating lease liabilities	$	14,656		$	14,086
Lease assets obtained in exchange for new operating lease liabilities	$	11,883		$	11,359
Weighted-average remaining lease term - operating leases	4.0 years			4.5 years
Weighted-average discount rate - operating leases	3.2		%	3.1		%

Future maturities of lease liabilities are as follows:


(In thousands)	2024

Fiscal 2025	$	12,498
Fiscal 2026	11,206
Fiscal 2027	10,845
Fiscal 2028	6,421
Fiscal 2029	1,991
Thereafter	1,826
Total lease payments	44,787
Less: Amounts representing interest	594
Present value of lease liabilities	$	44,193