(4) Leases


(a)	Lessee

In 2019, the Company adopted the ASU requiring the lease rights and obligations arising from existing and new lease agreements be recognized as assets and liabilities on the balance sheet. As of December 30, 2018, the Company recognized $2,922,446,000 of operating lease right-of-use assets and operating lease liabilities on the consolidated balance sheet. The adoption of the ASU did not have a material effect on the Company’s results of operations and had no effect on the Company’s cash flows.

The Company included finance lease right-of-use assets of $154,217,000 in net property, plant and equipment and finance lease liabilities of $29,480,000 and $104,806,000 in other accrued expenses and other noncurrent liabilities, respectively, on the consolidated balance sheet as of December 28, 2019.

Lease expense for 2019 was as follows:



	2019
	(Amounts are in thousands)
Operating lease expense		$	434,555
Finance lease expense:
Amortization of right-of-use assets		8,128
Interest on lease liabilities		3,105
Variable lease expense		147,463
Sublease rental income		(2,874		)
		$	590,377

Supplemental cash flow information related to leases for 2019 was as follows:



	2019
	(Amounts are in thousands)
Operating cash flows from rent paid for operating lease liabilities		$	422,596
Right-of-use assets obtained in exchange for new lease liabilities:
Operating leases		463,727
Finance leases		65,539

The weighted-average remaining lease term and weighted-average discount rate as of December 28, 2019 are as follows:



	December 28, 2019
Weighted-average remaining lease term:
Operating leases		12 years
Finance leases		18 years
Weighted-average discount rate:
Operating leases		3.5	%
Finance leases		3.9	%

Maturities of lease liabilities as of December 28, 2019 are as follows:




Year	Operating Leases			Finance Leases
	(Amounts are in thousands)
2020	$	430,983		33,068
2021	405,096			8,101
2022	369,434			8,101
2023	327,091			22,817
2024	280,317			7,132
Thereafter	1,852,831			91,140
	3,665,752			170,359
Less: Imputed interest	(727,155		)	(36,073	)
	$	2,938,597		134,286

As of December 28, 2019, the Company has lease agreements that have not yet commenced with fixed lease payments totaling $282,322,000. These leases will commence in future periods with terms ranging up to 20 years.

Prior to the adoption of the ASU, minimum rentals represented fixed lease obligations, including insurance and maintenance to the extent they were fixed in the lease. Contingent rentals represented variable lease obligations, including real estate taxes, insurance, maintenance and, for certain locations, excess rent. The Company recognized rent expense for operating leases with rent escalation clauses on a straight-line basis over the applicable lease term.

Total rental expense for 2018 and 2017 was as follows:



	2018			2017
	(Amounts are in thousands)
Minimum rentals	$	449,138		437,403
Contingent rentals	133,382			126,855
Sublease rental income	(4,339		)	(4,617	)
	$	578,181		559,641