XML 84 R14.htm IDEA: XBRL DOCUMENT

LEASES

3 Months Ended

Mar. 31, 2020

LEASESWe have operating and finance leases for corporate and market offices, warehouses, automotive and other equipment. Some of our leases may include options to extend or terminate the lease. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.


	Classification	March 31, 2020		December 31, 2019
Assets
Operating right-of-use assets	Right-of-use asset	$	169.9	$	175.4
Finance right-of-use assets	Property, Plant and Equipment	2.1		2.4
Total right-of-use assets		172.0		177.8

Liabilities
Current
Operating lease liabilities	Other accrued liabilities	$	45.4	$	45.7
Finance lease liabilities	Other accrued liabilities	0.9		1.0
Total current lease liabilities		46.3		46.7

Noncurrent
Operating lease liabilities	Long-term operating lease liability	$	137.7	$	143.3
Finance lease liabilities	Long-term debt	1.3		1.4
Total noncurrent lease liabilities		$	139.0	$	144.7

Total lease liability		$	185.3	$	191.4

The table below shows the lease income and expenses recorded in the Consolidated Statement of Operations incurred during the three months ended March 31, 2020 and 2019.


		Three months ended March 31,		Three months ended March 31,
Lease Costs	Classification	2020		2019
Operating lease cost⁽¹⁾	Selling, general and administrative expenses	$	16.0	$	16.8
Finance lease cost
Amortization of right-of-use assets	Selling, general and administrative expenses	.3		.4
Interest on lease liabilities	Interest Expense	.1		.1
Short-term leases costs	Selling, general and administrative expenses	.4		1.1
Sublease income⁽²⁾	Selling, general and administrative expenses	(4.1)		(3.2)
Net lease cost		$	12.7	$	15.2

⁽¹⁾ Includes variable lease costs which are immaterial. These are presented in selling, general and administrative expenses in our Consolidated Statements of Operations.

⁽²⁾ Sublease portfolio consists of the sublease of our previous principal executive office located at 777 Third Avenue, New York, NY.

The maturity analysis of the finance and operating lease liabilities is reflected below. This table also reflects the reconciliation of the undiscounted cash flows to the discounted finance and operating lease liabilities as recognized in the March 31, 2020 Consolidated Balance Sheet:


Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2020	$	45.0	$	.8	$	45.8
2021	51.7		.9		52.6
2022	43.8		.6		44.4
2023	29.3		.1		29.4
2024	21.0		—		21.0
2025	18.0		—		18.0
Thereafter	11.6		—		11.6
Total lease payments	$	220.4	$	2.4	$	222.8
Less: Interest	(37.3)		(.2)		(37.5)
Present value of lease liabilities	$	183.1	$	2.2	$	185.3

At December 31, 2019 our operating and finance lease obligations by due dates were as follows:


Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2020	59.7		1.2		60.9
2021	50.5		.9		51.4
2022	42.4		.6		43.0
2023	28.3		.1		28.4
2024	20.2		—		20.2
Thereafter	30.1		—		30.1
Total lease payments	$	231.2	$	2.8	$	234.0
Less: Interest	42.2		.4		42.6
Present value of lease liabilities	$	189.0	$	2.4	$	191.4

The Company has calculated the weighted-average remaining lease term, presented in years below, and the weighted-average discount rate for our operating and finance lease population. As noted in our lease accounting policy (See Note 1, Accounting Policies to the Consolidated Financial Statements contained herein), the Company uses the incremental borrowing rate as the lease discount rate.


Lease Term and Discount Rate	March 31, 2020		December 31, 2019
Weighted-average remaining lease term (years)
Operating leases	4.6		4.8
Finance leases	2.5		2.6
Weighted-average discount rate
Operating leases	8.2	%	8.5	%
Finance leases	10.7	%	11.2	%

The table below sets out the classification of lease payments in the Consolidated Statement of Cash Flows. The right-of-use assets obtained in exchange for new finance and operating lease liabilities represent the new operating and finance leases entered into during the three and nine months ended March 31, 2020.


Other Information	Three months ended March 31, 2020		Three months ended March 31, 2019
Operating cash flows from operating leases	$	16.1	$	16.4
Financing cash flows from finance leases	.3		.3
Cash paid for amounts included in measurement of liabilities	$	16.4	$	16.7

Right-of-use assets obtained in exchange for new finance liabilities	$	.1	$	.7
Right-of-use assets obtained in exchange for new operating liabilities	$	11.9	$	12.8

Leases


	Classification	March 31, 2020		December 31, 2019
Assets
Operating right-of-use assets	Right-of-use asset	$	169.9	$	175.4
Finance right-of-use assets	Property, Plant and Equipment	2.1		2.4
Total right-of-use assets		172.0		177.8

Liabilities
Current
Operating lease liabilities	Other accrued liabilities	$	45.4	$	45.7
Finance lease liabilities	Other accrued liabilities	0.9		1.0
Total current lease liabilities		46.3		46.7

Noncurrent
Operating lease liabilities	Long-term operating lease liability	$	137.7	$	143.3
Finance lease liabilities	Long-term debt	1.3		1.4
Total noncurrent lease liabilities		$	139.0	$	144.7

Total lease liability		$	185.3	$	191.4

The table below shows the lease income and expenses recorded in the Consolidated Statement of Operations incurred during the three months ended March 31, 2020 and 2019.


		Three months ended March 31,		Three months ended March 31,
Lease Costs	Classification	2020		2019
Operating lease cost⁽¹⁾	Selling, general and administrative expenses	$	16.0	$	16.8
Finance lease cost
Amortization of right-of-use assets	Selling, general and administrative expenses	.3		.4
Interest on lease liabilities	Interest Expense	.1		.1
Short-term leases costs	Selling, general and administrative expenses	.4		1.1
Sublease income⁽²⁾	Selling, general and administrative expenses	(4.1)		(3.2)
Net lease cost		$	12.7	$	15.2

⁽¹⁾ Includes variable lease costs which are immaterial. These are presented in selling, general and administrative expenses in our Consolidated Statements of Operations.

⁽²⁾ Sublease portfolio consists of the sublease of our previous principal executive office located at 777 Third Avenue, New York, NY.


Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2020	$	45.0	$	.8	$	45.8
2021	51.7		.9		52.6
2022	43.8		.6		44.4
2023	29.3		.1		29.4
2024	21.0		—		21.0
2025	18.0		—		18.0
Thereafter	11.6		—		11.6
Total lease payments	$	220.4	$	2.4	$	222.8
Less: Interest	(37.3)		(.2)		(37.5)
Present value of lease liabilities	$	183.1	$	2.2	$	185.3

At December 31, 2019 our operating and finance lease obligations by due dates were as follows:


Maturity of Lease Liabilities	Operating Leases		Finance Leases		Total
2020	59.7		1.2		60.9
2021	50.5		.9		51.4
2022	42.4		.6		43.0
2023	28.3		.1		28.4
2024	20.2		—		20.2
Thereafter	30.1		—		30.1
Total lease payments	$	231.2	$	2.8	$	234.0
Less: Interest	42.2		.4		42.6
Present value of lease liabilities	$	189.0	$	2.4	$	191.4


Lease Term and Discount Rate	March 31, 2020		December 31, 2019
Weighted-average remaining lease term (years)
Operating leases	4.6		4.8
Finance leases	2.5		2.6
Weighted-average discount rate
Operating leases	8.2	%	8.5	%
Finance leases	10.7	%	11.2	%


Other Information	Three months ended March 31, 2020		Three months ended March 31, 2019
Operating cash flows from operating leases	$	16.1	$	16.4
Financing cash flows from finance leases	.3		.3
Cash paid for amounts included in measurement of liabilities	$	16.4	$	16.7

Right-of-use assets obtained in exchange for new finance liabilities	$	.1	$	.7
Right-of-use assets obtained in exchange for new operating liabilities	$	11.9	$	12.8