Leases

3 Months Ended

Oct. 31, 2019

Leases [Abstract]

Leases

	October 31, 2019
Weighted-average remaining lease term
Operating leases	14.5 years
Finance leases	7.6 years
Weighted-average discount rate
Operating leases	3.4	%
Finance leases	9.7	%

Leases

Leases

On August 1, 2019, the Company adopted new accounting guidance under Accounting Standards Codification Topic 842 ("ASC 842") Leases. ASC 842 established new criteria for recognizing right-of-use assets and lease liabilities for operating lease arrangements. The Company elected to adopt this guidance utilizing the optional transition method that allowed the Company to implement this new guidance prospectively, and to only include the disclosures required under ASC 842 for the periods subsequent to adoption.

The Company has operating leases principally for land, buildings and equipment and also leases certain real estate under various finance leases expiring between calendar 2019 and 2028. Leases with an initial term of 12 months or fewer and which do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the term of the lease.

Certain of the Company's leases include options to extend or terminate the leases and these options have been included in the relevant lease term to the extent that they are reasonably certain to be exercised.

The Company has elected the practical expedient to not separate non-lease components from the lease components to which they relate, and instead account for each separate lease and non-lease component associated with that lease component as a single lease component for all underlying asset classes. Accordingly, all costs associated with a lease contract are accounted for as lease costs. Lease costs are recorded in Cost of products sold, Selling, general, and administrative expenses and Interest expense in the Condensed Consolidated Statements of Income and Comprehensive Income.

The Company does not include significant restrictions or covenants in our lease agreements, and residual value guarantees are not generally included within our operating leases.

The components of lease costs for the three-month period ended October 31, 2019 were as follows:

	Three Months Ended
	October 31, 2019
Operating lease cost	$	3,031
Finance lease cost
Amortization of right-of-use assets	136
Interest on lease liabilities	137
Total lease cost	$	3,304

Other information related to leases was as follows:

	Three Months Ended
Supplemental Cash Flows Information	October 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	3,005
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	278

Supplemental Balance Sheet Information	October 31, 2019
Operating leases:
Operating lease right-of-use assets	$	32,008
Other current liabilities	4,307
Other long-term liabilities	27,825
Total operating lease liabilities	$	32,132
Finance leases:
Finance lease right-of-use assets	$	4,079
Other current liabilities	449
Other long-term liabilities	5,134
Total finance lease liabilities	$	5,583

	October 31, 2019
Weighted-average remaining lease term
Operating leases	14.5 years
Finance leases	7.6 years
Weighted-average discount rate
Operating leases	3.4	%
Finance leases	9.7	%

Future minimum rental payments required under operating and finance leases as of October 31, 2019 were as follows:

	Operating Leases		Financing Leases
For the remainder of the fiscal year ending July 31, 2020	$	7,127	$	729
For the fiscal year ending July 31, 2021	7,370		991
For the fiscal year ending July 31, 2022	5,912		1,013
For the fiscal year ending July 31, 2023	4,144		1,036
For the fiscal year ending July 31, 2024	3,526		1,059
For the fiscal year ending July 31, 2025 and thereafter	20,845		3,092
Total future lease payments	$	48,924	$	7,920
Less: amount representing interest	(16,792)		(2,337)
Total reported lease liability	$	32,132	$	5,583

Future minimum rental payments required under operating and finance leases as of July 31, 2019 were as follows:

	Operating Leases		Finance Leases
For the fiscal year ending July 31, 2020	$	8,785	$	974
For the fiscal year ending July 31, 2021	6,809		993
For the fiscal year ending July 31, 2022	5,437		1,015
For the fiscal year ending July 31, 2023	3,980		1,037
For the fiscal year ending July 31, 2024	3,424		1,061
For the fiscal year ending July 31, 2025 and thereafter	20,745		3,037
Total future lease payments	$	49,180	8,117
Less: amount representing interest			(2,427)
Total lease liability			5,690
Less: current portion			(444)
Long-term finance lease obligations			$	5,246