Leases

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Leases

Leases:

We lease real estate, vehicles, and equipment under operating and finance leases with non-cancelable terms generally expiring at various dates through 2037. Our operating and finance leases generally have 1- to 25-year terms, with one or more renewal options, primarily relating to our real estate leases, with terms to be determined at the time of renewal. The exercise of such lease renewal options is at our sole discretion, and to the extent we are reasonably certain we will exercise a renewal option, the years related to that option are included in our determination of the lease term for purposes of classifying and measuring a given lease. Certain leases also include options to purchase the leased property.

The components of lease costs are as follows (in millions):

	For the Year Ended December 31, 2019
Operating lease cost	$	72.9
Finance lease cost:
Amortization of right-of-use assets	30.3
Interest on lease liabilities	29.5
Total finance lease cost	59.8
Variable lease cost	1.5
Sublease income	(3.2		)
Total lease cost	$	131.0

Supplemental consolidated balance sheet information related to leases is as follows (in millions):

	Classification	As of December 31, 2019
Assets
Operating lease	Operating lease right-of-use assets	$	276.5
Finance lease (1)	Property and equipment, net	327.0
Total leased assets		$	603.5
Liabilities
Current liabilities:
Operating lease	Current operating lease liabilities	$	40.4
Finance lease	Current portion of long-term debt	21.0
Noncurrent liabilities:
Operating lease	Long-term operating lease liabilities	243.8
Finance lease	Long-term debt, net of current portion	363.1
Total leased liabilities		$	668.3

⁽¹⁾  Finance lease assets are recorded net of accumulated amortization of $99.6 million as of December 31, 2019.

	As of December 31, 2019
Weighted Average Remaining Lease Term
Operating lease	9.1 years
Finance lease	13.4 years
Weighted Average Discount Rate
Operating lease	6.2	%
Finance lease	7.9	%

Maturities of lease liabilities as of December 31, 2019 are as follows (in millions):

Year Ending December 31,	Operating Leases			Finance Leases
2020	$	57.5		$	50.4
2021	53.2			48.9
2022	45.4			45.5
2023	40.7			45.3
2024	34.4			44.7
2025 and thereafter	153.0			405.7
Total lease payments	384.2			640.5
Less: Interest portion	(100.0		)	(256.4		)
Total lease liabilities	$	284.2		$	384.1

Supplemental cash flow information related to our leases is as follows (in millions):

	For the Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	70.4
Operating cash flows from finance leases	30.0
Financing cash flows from finance leases	19.5
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	43.8
Finance leases	34.2

Information prior to the adoption of ASC 842—

Information related to assets under capital lease obligations is as follows (in millions):

	As of December 31, 2018
Assets under capital lease obligations:
Buildings	$	329.6
Vehicles	21.1
Equipment	0.3
	351.0
Less: Accumulated amortization	(126.9		)
Assets under capital lease obligations, net	$	224.1

The amount of amortization expense relating to assets under capital lease obligations and rent expense under operating leases is as follows (in millions):

	For the Year Ended December 31,
	2018		2017
Amortization expense	$	24.1	$	22.7
Rent expense:
Minimum rent payments	$	69.8	$	66.5
Contingent and other rents	24.9		24.1
Other	9.1		8.9
Total rent expense	$	103.8	$	99.5

Future minimum lease payments at December 31, 2018, for those leases having an initial or remaining noncancelable lease term in excess of one year, are as follows (in millions):

Year Ending December 31,	Operating Leases		Capital Lease Obligations
2019	$	71.4	$	36.2
2020	65.8		32.3
2021	54.3		30.3
2022	41.0		28.7
2023	35.3		28.0
2024 and thereafter	148.2		299.7
	$	416.0	455.2
Less: Interest portion			(191.4		)
Obligations under capital leases			$	263.8

Rental income from subleases approximated $3.0 million and $2.9 million for the years ended December 31, 2018 and 2017, respectively.

Leases

Leases:

We lease real estate, vehicles, and equipment under operating and finance leases with non-cancelable terms generally expiring at various dates through 2037. Our operating and finance leases generally have 1- to 25-year terms, with one or more renewal options, primarily relating to our real estate leases, with terms to be determined at the time of renewal. The exercise of such lease renewal options is at our sole discretion, and to the extent we are reasonably certain we will exercise a renewal option, the years related to that option are included in our determination of the lease term for purposes of classifying and measuring a given lease. Certain leases also include options to purchase the leased property.

The components of lease costs are as follows (in millions):

	For the Year Ended December 31, 2019
Operating lease cost	$	72.9
Finance lease cost:
Amortization of right-of-use assets	30.3
Interest on lease liabilities	29.5
Total finance lease cost	59.8
Variable lease cost	1.5
Sublease income	(3.2		)
Total lease cost	$	131.0

Supplemental consolidated balance sheet information related to leases is as follows (in millions):

	Classification	As of December 31, 2019
Assets
Operating lease	Operating lease right-of-use assets	$	276.5
Finance lease (1)	Property and equipment, net	327.0
Total leased assets		$	603.5
Liabilities
Current liabilities:
Operating lease	Current operating lease liabilities	$	40.4
Finance lease	Current portion of long-term debt	21.0
Noncurrent liabilities:
Operating lease	Long-term operating lease liabilities	243.8
Finance lease	Long-term debt, net of current portion	363.1
Total leased liabilities		$	668.3

⁽¹⁾  Finance lease assets are recorded net of accumulated amortization of $99.6 million as of December 31, 2019.

	As of December 31, 2019
Weighted Average Remaining Lease Term
Operating lease	9.1 years
Finance lease	13.4 years
Weighted Average Discount Rate
Operating lease	6.2	%
Finance lease	7.9	%

Maturities of lease liabilities as of December 31, 2019 are as follows (in millions):

Year Ending December 31,	Operating Leases			Finance Leases
2020	$	57.5		$	50.4
2021	53.2			48.9
2022	45.4			45.5
2023	40.7			45.3
2024	34.4			44.7
2025 and thereafter	153.0			405.7
Total lease payments	384.2			640.5
Less: Interest portion	(100.0		)	(256.4		)
Total lease liabilities	$	284.2		$	384.1

Supplemental cash flow information related to our leases is as follows (in millions):

	For the Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	70.4
Operating cash flows from finance leases	30.0
Financing cash flows from finance leases	19.5
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	43.8
Finance leases	34.2

Information prior to the adoption of ASC 842—

Information related to assets under capital lease obligations is as follows (in millions):

	As of December 31, 2018
Assets under capital lease obligations:
Buildings	$	329.6
Vehicles	21.1
Equipment	0.3
	351.0
Less: Accumulated amortization	(126.9		)
Assets under capital lease obligations, net	$	224.1

The amount of amortization expense relating to assets under capital lease obligations and rent expense under operating leases is as follows (in millions):

	For the Year Ended December 31,
	2018		2017
Amortization expense	$	24.1	$	22.7
Rent expense:
Minimum rent payments	$	69.8	$	66.5
Contingent and other rents	24.9		24.1
Other	9.1		8.9
Total rent expense	$	103.8	$	99.5

Future minimum lease payments at December 31, 2018, for those leases having an initial or remaining noncancelable lease term in excess of one year, are as follows (in millions):

Year Ending December 31,	Operating Leases		Capital Lease Obligations
2019	$	71.4	$	36.2
2020	65.8		32.3
2021	54.3		30.3
2022	41.0		28.7
2023	35.3		28.0
2024 and thereafter	148.2		299.7
	$	416.0	455.2
Less: Interest portion			(191.4		)
Obligations under capital leases			$	263.8

Rental income from subleases approximated $3.0 million and $2.9 million for the years ended December 31, 2018 and 2017, respectively.