LEASES

12 Months Ended

Dec. 31, 2019

NOTE 23. LEASES

Our lease commitments are primarily for railcars, but also include logistics, manufacturing, storage, real estate and information technology assets. Our leases have remaining lease terms of up to 95 years, some of which may include options to extend the leases for up to five years, and some of which may include options to terminate the leases within one year.

The amounts for leases included in our consolidated balance sheet include:



		December 31, 2019
Lease assets:	Balance sheet location:	($ in millions)
Operating	Operating lease assets, net	$	377.8
Finance	Property, plant and equipment, less accumulated depreciation⁽¹⁾	5.4
Total lease assets		$	383.2
Lease liabilities:
Current
Operating	Current operating lease liabilities	$	79.3
Finance	Current installments of long-term debt	2.1
Long-term
Operating	Operating lease liabilities	303.4
Finance	Long-term debt	3.2
Total lease liabilities		$	388.0


(1)	As of December 31, 2019, assets recorded under finance leases were $9.9 million and accumulated depreciation associated with finance leases was $4.5 million.

The components of lease expense are recorded to cost of goods sold and selling and administration expenses in the consolidated statement of operations, excluding interest on finance lease liabilities which is recorded to interest expense. The components of lease expense were as follows:



	Year Ended December 31, 2019
Lease expense:	($ in millions)
Operating	$	93.6
Other operating lease expense⁽¹⁾	27.5
Finance:
Depreciation of leased assets	1.3
Interest on lease liabilities	0.2
Total lease expense	$	122.6


(1)	Includes costs associated with short-term leases and variable lease expenses.

The maturities of lease liabilities were as follows:



	December 31, 2019
	Operating leases			Finance leases			Total
	($ in millions)
2020	$	88.8		$	2.2		$	91.0
2021	71.0			1.1			72.1
2022	55.0			0.8			55.8
2023	44.2			0.6			44.8
2024	33.5			0.8			34.3
Thereafter	153.6			0.2			153.8
Total lease payments	446.1			5.7			451.8
Less: Imputed interest⁽¹⁾	(63.4		)	(0.4		)	(63.8		)
Present value of lease liabilities	$	382.7		$	5.3		$	388.0


(1)	Calculated using the discount rate for each lease.

As previously disclosed in our 2018 Annual Report on Form 10-K and under ASC 840, the previous lease accounting standard, future minimum lease payments for non-cancelable operating leases were expected to be as follows:



	December 31, 2018
	($ in millions)
2019	$	82.2
2020	61.4
2021	44.2
2022	31.8
2023	23.2
Thereafter	102.6
Total lease payments	$	345.4

Other information related to leases was as follows:



	Year Ended December 31, 2019
Supplemental cash flows information:	($ in millions)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	93.4
Operating cash flows from finance leases	0.2
Financing cash flows from finance leases	1.4
Non-cash increase in lease assets and lease liabilities:
Operating leases	$	176.1
Finance leases	2.5
Weighted-average remaining lease term:	December 31, 2019
Operating leases	9.4 years
Finance leases	3.2 years
Weighted-average discount rate:
Operating leases	3.10		%
Finance leases	3.30		%

As of December 31, 2019, we have additional operating leases for office space that have not yet commenced of approximately $27 million which are expected to commence during 2020 with lease terms between 10 years and 15 years. We

also have additional operating leases for railcars that have not yet commenced of approximately $9 million which are expected to commence during 2020 with lease terms between 5 years and 10 years.