Leases and Commitments

12 Months Ended

Dec. 31, 2021

Leases and Commitments

We have entered into leases for certain facilities, vehicles, material handling and other equipment. Our leases have remaining contractual terms up to 97 years, some of which include options to extend the leases for up to 99 years, and some of which include options to terminate the leases within 1 year. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Our lease costs are primarily related to facility leases for inventory warehousing and administration offices.

Lease Expense


	Year Ended December 31
	2021		2020		2019		Income Statement Classification
Operating lease expense	$	157	$	168	$	162	Cost of products sold, Marketing, research and general expenses



Finance lease expense:
Amortization of lease assets	13		9		5		Cost of products sold
Interest on lease liabilities	2		1		2		Interest expense
Total finance lease expense	15		10		7

Variable lease expense(a)	219		202		145		Cost of products sold, Marketing, research and general expenses
Total lease expense	$	391	$	380	$	314

(a) Includes short-term leases, which are immaterial.

Lease Assets and Liabilities


	December 31
	2021		2020		Balance Sheet Classification
Assets
Operating lease	$	488	$	540	Other Assets
Finance lease	86		47		Property, Plant and Equipment, Net
Total lease assets	$	574	587
Liabilities
Current:
Operating lease	130		$	133	Accrued expenses and other current liabilities
Finance lease	$	11	$	9	Debt payable within one year
Noncurrent:
Operating lease	393		423		Other Liabilities
Finance lease	60		20		Long-Term Debt
Total lease liabilities	$	594	$	585

As of December 31, 2021 and 2020, accumulated amortization of finance lease assets was $27 and $14, respectively.

Maturity of Lease Liabilities


	December 31, 2021
	Operating Leases		Finance Leases		Total
2022	$	142	$	12	$	154
2023	119		12		131
2024	93		10		103
2025	76		7		83
2026	64		6		70

Thereafter	64		35		99
Total lease payments	558		82		640
Less imputed interest	35		11		46
Present value of lease liabilities	$	523	$	71	$	594

As of December 31, 2021, our operating leases have a weighted-average remaining lease term of 5 years and a weighted-average discount rate of 3 percent and our finance leases have a weighted-average remaining lease term of 9 years and a weighted-average discount rate of 3 percent.

Supplemental Information Related to Leases


	December 31
	2021		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating leases	$	155	$	164	$	163
Finance leases	13		14		18
Lease assets obtained in exchange for new lease obligations:
Operating leases	34		198		504
Finance leases	56		20		38
Other non-cash modifications to lease assets:
Operating leases	61		98		31

We have entered into long-term contracts for the purchase of superabsorbent materials, pulp and certain utilities. Commitments under these contracts based on current prices are $1,530 in 2022, $729 in 2023, $96 in 2024, $94 in 2025, $34 in 2026, and $56 beyond the year 2026.

Although we are primarily liable for payments on the above-mentioned leases and purchase commitments, our exposure to losses, if any, under these arrangements is not material.