XML 32 R14.htm IDEA: XBRL DOCUMENT
v3.21.4

Leases | 12 Months Ended
--- | ---
Nov. 30, 2021
Leases [Abstract] |
Leases | LEASES Our lease portfolio primarily consists of (i) certain real estate, including those related to a number of administrative, distribution and manufacturing locations; (ii) certain machinery and equipment, including forklifts; and (iii) automobiles, delivery trucks and other vehicles, including an airplane. A limited number of our lease agreements include rental payments that are adjusted periodically based on a market rate or index. Our lease agreements generally do not contain residual value guarantees or material restrictive covenants, with the exception of the non-cancellable synthetic lease discussed below. The following presents the components of our lease expense for the years ended November 30 (in millions):
| 2021 | 2020
Operating lease cost | $ | 45.0 |  | $ | 41.2 |
Finance lease cost: |  |
Amortization of ROU assets | 9.0 |  | 9.0 |
Interest on lease liabilities | 4.3 |  | 4.5 |
Net lease cost | $ | 58.3 |  | $ | 54.7 |
(1) Net lease cost does not include short-term leases, variable lease costs or sublease income, all of which are immaterial.
Rental expense under operating leases (primarily buildings and equipment) was $48.1 million in 2019. Supplemental balance sheet information related to leases as of November 30 were as follows (in millions):
Leases |  | Classification | 2021 | 2020
Assets: |  |  |  |
Operating lease ROU assets |  | Other long-term assets | $ | 136.8 |  | $ | 136.8 |
Finance lease ROU assets |  | Property, plant and equipment, net | 112.1 |  | 120.7 |
Total leased assets |  |  | $ | 248.9 |  | $ | 257.5 |
Liabilities: |  |  |  |
Current |  |  |  |
Operating |  | Other accrued liabilities | $ | 34.3 |  | $ | 37.3 |
Finance |  | Current portion of long-term debt | 7.5 |  | 7.3 |
Non-current |  |  |  |
Operating |  | Other long-term liabilities | 106.1 |  | 103.5 |
Finance |  | Long-term debt | 118.2 |  | 125.5 |
Total lease liabilities |  |  | $ | 266.1 |  | $ | 273.6 |
Our Corporate functions, Americas' leadership, and U.S. staff reside in our Hunt Valley, Maryland headquarters office building. The 15-year lease for that building requires monthly lease payments of approximately $0.9 million which began in April 2019. The $0.9 million monthly lease payment is subject to adjustment after an initial 60-month period and thereafter on an annual basis as specified in the lease agreement. We recognized this lease as a finance lease, with the leased asset of $107.4 million and $116.1 million included in property, plant and equipment, net, as of November 30, 2021 and 2020, respectively. During each of the years ended November 30, 2021, 2020 and 2019, we recognized amortization expense of $8.7 million related to the leased asset. As of November 30, 2021, the total lease obligation associated with this building was $123.8 million, of which $7.3 million was included in the current portion of long-term debt and $116.5 million was included in long-term debt. As of November 30, 2020, the total lease obligation was $130.9 million, of which $7.1 million was included in the current portion of long-term debt and $123.8 million was included in long-term debt. Information regarding our lease terms and discount rates as of November 30 were as follows:
| 2021 | 2020
| Weighted-average remaining lease term (years) | Weighted-average discount rate | Weighted-average remaining lease term (years) | Weighted-average discount rate
Operating leases | 6.8 | 1.9 | % | 5.6 | 1.9 | %
Finance leases | 12.9 | 3.3 | % | 13.9 | 3.3 | %
The future maturity of our lease liabilities as of November 30, 2021 were as follows (in millions):
| Operating leases |  | Finance leases |  | Total
2022 | $ | 38.3 |  |  | $ | 11.4 |  |  | $ | 49.7 |
2023 | 28.6 |  |  | 11.4 |  |  | 40.0 |
2024 | 20.8 |  |  | 11.5 |  |  | 32.3 |
2025 | 15.7 |  |  | 11.7 |  |  | 27.4 |
2026 | 12.0 |  |  | 12.0 |  |  | 24.0 |
Thereafter | 38.8 |  |  | 102.0 |  |  | 140.8 |
Total lease payments | 154.2 |  |  | 160.0 |  |  | 314.2 |
Less: Imputed interest | 13.8 |  |  | 34.3 |  |  | 48.1 |
Total lease liabilities | $ | 140.4 |  |  | $ | 125.7 |  |  | $ | 266.1 |
Supplemental cash flow and other information related to leases for the years ended November 30 were as follows (in millions):
| 2021 | 2020
Cash paid for amounts included in the measurements of lease liabilities: |  |
Operating cash flows used for operating leases | $ | 45.4 |  | $ | 41.5 |
Operating cash flows used for finance leases | 4.3 |  | 4.5 |
Financing cash flows used for finance leases | 7.1 |  | 6.9 |
ROU assets obtained in exchange for lease liabilities |  |
Operating leases | $ | 47.8 |  | $ | 36.6 |
During October 2020, we entered into a non-cancellable synthetic lease for a distribution facility with an estimated construction cost of $315 million. The lease will commence upon completion of construction of the facility, for which we are the construction agent, which is expected to be in the later part of fiscal 2022. The term of the lease is five years after commencement. The lease contains options to negotiate a renewal of the lease or to purchase or sell the facility at the end of the lease term. Upon lease commencement, the ROU asset and lease liability will be determined and recorded. The lease arrangement also contains a residual value guarantee of approximately 75% of the total construction cost. The lease also contains covenants that are consistent with our $1.5 billion, five-year revolving credit agreement as disclosed in note 6.
Leases | LEASES Our lease portfolio primarily consists of (i) certain real estate, including those related to a number of administrative, distribution and manufacturing locations; (ii) certain machinery and equipment, including forklifts; and (iii) automobiles, delivery trucks and other vehicles, including an airplane. A limited number of our lease agreements include rental payments that are adjusted periodically based on a market rate or index. Our lease agreements generally do not contain residual value guarantees or material restrictive covenants, with the exception of the non-cancellable synthetic lease discussed below. The following presents the components of our lease expense for the years ended November 30 (in millions):
| 2021 | 2020
Operating lease cost | $ | 45.0 |  | $ | 41.2 |
Finance lease cost: |  |
Amortization of ROU assets | 9.0 |  | 9.0 |
Interest on lease liabilities | 4.3 |  | 4.5 |
Net lease cost | $ | 58.3 |  | $ | 54.7 |
(1) Net lease cost does not include short-term leases, variable lease costs or sublease income, all of which are immaterial.
Rental expense under operating leases (primarily buildings and equipment) was $48.1 million in 2019. Supplemental balance sheet information related to leases as of November 30 were as follows (in millions):
Leases |  | Classification | 2021 | 2020
Assets: |  |  |  |
Operating lease ROU assets |  | Other long-term assets | $ | 136.8 |  | $ | 136.8 |
Finance lease ROU assets |  | Property, plant and equipment, net | 112.1 |  | 120.7 |
Total leased assets |  |  | $ | 248.9 |  | $ | 257.5 |
Liabilities: |  |  |  |
Current |  |  |  |
Operating |  | Other accrued liabilities | $ | 34.3 |  | $ | 37.3 |
Finance |  | Current portion of long-term debt | 7.5 |  | 7.3 |
Non-current |  |  |  |
Operating |  | Other long-term liabilities | 106.1 |  | 103.5 |
Finance |  | Long-term debt | 118.2 |  | 125.5 |
Total lease liabilities |  |  | $ | 266.1 |  | $ | 273.6 |
Our Corporate functions, Americas' leadership, and U.S. staff reside in our Hunt Valley, Maryland headquarters office building. The 15-year lease for that building requires monthly lease payments of approximately $0.9 million which began in April 2019. The $0.9 million monthly lease payment is subject to adjustment after an initial 60-month period and thereafter on an annual basis as specified in the lease agreement. We recognized this lease as a finance lease, with the leased asset of $107.4 million and $116.1 million included in property, plant and equipment, net, as of November 30, 2021 and 2020, respectively. During each of the years ended November 30, 2021, 2020 and 2019, we recognized amortization expense of $8.7 million related to the leased asset. As of November 30, 2021, the total lease obligation associated with this building was $123.8 million, of which $7.3 million was included in the current portion of long-term debt and $116.5 million was included in long-term debt. As of November 30, 2020, the total lease obligation was $130.9 million, of which $7.1 million was included in the current portion of long-term debt and $123.8 million was included in long-term debt. Information regarding our lease terms and discount rates as of November 30 were as follows:
| 2021 | 2020
| Weighted-average remaining lease term (years) | Weighted-average discount rate | Weighted-average remaining lease term (years) | Weighted-average discount rate
Operating leases | 6.8 | 1.9 | % | 5.6 | 1.9 | %
Finance leases | 12.9 | 3.3 | % | 13.9 | 3.3 | %
The future maturity of our lease liabilities as of November 30, 2021 were as follows (in millions):
| Operating leases |  | Finance leases |  | Total
2022 | $ | 38.3 |  |  | $ | 11.4 |  |  | $ | 49.7 |
2023 | 28.6 |  |  | 11.4 |  |  | 40.0 |
2024 | 20.8 |  |  | 11.5 |  |  | 32.3 |
2025 | 15.7 |  |  | 11.7 |  |  | 27.4 |
2026 | 12.0 |  |  | 12.0 |  |  | 24.0 |
Thereafter | 38.8 |  |  | 102.0 |  |  | 140.8 |
Total lease payments | 154.2 |  |  | 160.0 |  |  | 314.2 |
Less: Imputed interest | 13.8 |  |  | 34.3 |  |  | 48.1 |
Total lease liabilities | $ | 140.4 |  |  | $ | 125.7 |  |  | $ | 266.1 |
Supplemental cash flow and other information related to leases for the years ended November 30 were as follows (in millions):
| 2021 | 2020
Cash paid for amounts included in the measurements of lease liabilities: |  |
Operating cash flows used for operating leases | $ | 45.4 |  | $ | 41.5 |
Operating cash flows used for finance leases | 4.3 |  | 4.5 |
Financing cash flows used for finance leases | 7.1 |  | 6.9 |
ROU assets obtained in exchange for lease liabilities |  |
Operating leases | $ | 47.8 |  | $ | 36.6 |
During October 2020, we entered into a non-cancellable synthetic lease for a distribution facility with an estimated construction cost of $315 million. The lease will commence upon completion of construction of the facility, for which we are the construction agent, which is expected to be in the later part of fiscal 2022. The term of the lease is five years after commencement. The lease contains options to negotiate a renewal of the lease or to purchase or sell the facility at the end of the lease term. Upon lease commencement, the ROU asset and lease liability will be determined and recorded. The lease arrangement also contains a residual value guarantee of approximately 75% of the total construction cost. The lease also contains covenants that are consistent with our $1.5 billion, five-year revolving credit agreement as disclosed in note 6.

X
- References No definition available. + Details
Name: | us-gaap_LeasesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeFinanceLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration