XML 32 R22.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

Leases | 3 Months Ended
--- | ---
Dec. 27, 2019
Leases [Abstract] |
Leases | Leases On September 28, 2019 the Company adopted ASU 2016-02, Leases ("ASC 842"), along with ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01, which amended and clarified the related guidance. ASC 842 requires lessees to recognize assets and liabilities for most leases. The Company determines if an arrangement is a lease at contract inception. A lease exists when a contract conveys to the customer the right to control the use of an identified asset for a period of time in exchange for consideration. The definition of a lease embodies two conditions: (1) there is an identified asset in the contract, and (2) the customer has the right to control the use of the identified asset. Lessees are required to classify leases as either finance or operating leases. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. ASC 842 provided several optional practical expedients for use in transition to and ongoing application of ASC 842. The Company elected to utilize the package of practical expedients in ASC 842-10-65-1(f) that, upon adoption of ASC 842, allows entities to (1) not reassess whether any expired or existing contracts are or contain leases, (2) retain the classification of leases (e.g., operating or finance lease) existing as of the date of adoption and (3) not reassess initial direct costs for any existing leases. The Company did not elect the transition practical expedient pertaining to the use of hindsight. The Company elected to utilize the practical expedient in ASC 842-10-15-37 in which the Company has chosen to account for each separate lease component of a contract and its associated nonlease components as a single lease component. The Company adopted ASC 842 using the modified retrospective method, and accordingly, the new guidance was applied to leases that existed as of September 28, 2019 (the date of initial application) without adjusting the comparative periods presented. As a result, as of September 28, 2019, the Company has recorded total right-of-use ("ROU") assets of $767.0 million, which is comprised of approximately $82.3 million in reclassifications of previously recorded lease incentives and deferred rent, offset by $141.4 million in restructured lease cease-use liability. Additionally, the Company has recorded total current lease liabilities of $180.7 million, and total noncurrent lease liabilities of $810.1 million. The adoption of ASC 842 did not have a material impact on the Company’s results of operations or any impact on the Company’s cash flows. The Company’s right-of use assets and lease liabilities relate to real estate, project assets used in connection with long-term construction contracts, IT assets and vehicles. The Company’s leases have remaining lease terms of one year to thirteen years. The Company’s lease obligations are primarily for the use of office space and are primarily operating leases. Certain of the Company’s leases contain renewal, extension, or termination options. The Company assesses each option on an individual basis and will only include options reasonably certain of exercise in the lease term. The Company generally considers the base term to be the term provided in the contract. None of the Company’s lease agreements contain material options to purchase the lease property, material residual value guarantees, or material restrictions or covenants. Long-term project asset and vehicle leases (leases with terms greater than twelve months), along with all real estate and IT asset leases, are recorded on the consolidated balance sheet at the present value of the minimum lease payments not yet paid. Because the Company primarily acts as a lessee and the rates implicit in its leases are not readily determinable, the Company generally uses its incremental borrowing rate on the lease commencement date to calculate the present value of future lease payments. Certain leases include payments that are based solely on an index or rate. These variable lease payments are included in the calculation of the ROU asset and lease liability and are initially measured using the index or rate at the lease commencement date. Other variable lease payments, such as payments based on use and for property taxes, insurance, or common area maintenance that are based on actual assessments are excluded from the ROU asset and lease liability, and are expensed as incurred. In addition to the present value of the future lease payments, the calculation of the ROU asset also includes any deferred rent, lease pre-payments and initial direct costs of obtaining the lease, such as commissions. Certain lease contracts contain nonlease components such as maintenance and utilities. The Company has made an accounting policy election, as allowed under ASC 842-10-15-37 and discussed above, to capitalize both the lease component and nonlease components of its contracts as a single lease component for all of its right-of-use assets. Short-term project asset and vehicle leases (project asset and vehicle leases with an initial term of twelve months or less or leases that are cancellable by the lessee and lessor without significant penalties) are not recorded on the consolidated balance sheet and are expensed on a straight-line basis over the lease term. The majority of the Company’s short-term leases relate to equipment used on construction projects. These leases are entered into at agreed upon hourly, daily, weekly or monthly rental rates for an unspecified duration and typically have a termination for convenience provision. Such equipment leases are considered short-term in nature unless it is reasonably certain that the equipment will be leased for a term greater than twelve months. The components of lease expense (reflected in selling, general and administrative expenses) for the three months ended December 27, 2019 were as follows (in thousands):
|  | Three Months Ended
|  | December 27, 2019
Lease cost |  |
Operating lease cost |  | $ | 44,080 |
Variable lease cost |  | 8,597 |
Sublease income |  | (3,334) |
Total lease cost |  | $ | 49,343 |
Information related to the Company's right-of use assets and lease liabilities as of December 27, 2019 was as follows (in thousands):
Lease Asset/Liabilities |  | Balance Sheet Classification |  | December 27, 2019
Right-of-use assets |  |  |  |
Operating lease assets |  | Miscellaneous assets |  | $ | 760,226 |
Lease Liabilities |  |  |  |  |
Operating lease liabilities, current |  | Accrued liabilities |  | 176,546 |
Operating lease liabilities, noncurrent |  | Other deferred liabilities |  | 804,749 |
Total lease liabilities |  |  |  | $ | 981,295 |
Supplemental information related to the Company's leases for the three months ended December 27, 2019 was as follows (in thousands):
|  | Three Months Ended
|  | December 27, 2019
Cash paid for amounts included in the measurements of lease liabilities |  | $ | 48,167 |
Right-of-use assets obtained in exchange for new operating lease liabilities |  | $ | 16,482 |
Weighted average remaining lease term - operating leases |  | 7.9 years |
Weighted average discount rate - operating leases |  | 2.7 | %
Total remaining lease payments under the Company's leases for the remainder of fiscal 2020 and for the succeeding years was as follows (in thousands):
Fiscal Year |  | Operating Leases
2020 |  | $ | 142,102 |
2021 |  | 169,480 |
2022 |  | 152,328 |
2023 |  | 135,567 |
2024 |  | 119,794 |
Thereafter |  | 374,113 |
|  | 1,093,384 |
Less Interest |  | (112,089) |
|  | $ | 981,295 |
Leases | Leases On September 28, 2019 the Company adopted ASU 2016-02, Leases ("ASC 842"), along with ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01, which amended and clarified the related guidance. ASC 842 requires lessees to recognize assets and liabilities for most leases. The Company determines if an arrangement is a lease at contract inception. A lease exists when a contract conveys to the customer the right to control the use of an identified asset for a period of time in exchange for consideration. The definition of a lease embodies two conditions: (1) there is an identified asset in the contract, and (2) the customer has the right to control the use of the identified asset. Lessees are required to classify leases as either finance or operating leases. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. ASC 842 provided several optional practical expedients for use in transition to and ongoing application of ASC 842. The Company elected to utilize the package of practical expedients in ASC 842-10-65-1(f) that, upon adoption of ASC 842, allows entities to (1) not reassess whether any expired or existing contracts are or contain leases, (2) retain the classification of leases (e.g., operating or finance lease) existing as of the date of adoption and (3) not reassess initial direct costs for any existing leases. The Company did not elect the transition practical expedient pertaining to the use of hindsight. The Company elected to utilize the practical expedient in ASC 842-10-15-37 in which the Company has chosen to account for each separate lease component of a contract and its associated nonlease components as a single lease component. The Company adopted ASC 842 using the modified retrospective method, and accordingly, the new guidance was applied to leases that existed as of September 28, 2019 (the date of initial application) without adjusting the comparative periods presented. As a result, as of September 28, 2019, the Company has recorded total right-of-use ("ROU") assets of $767.0 million, which is comprised of approximately $82.3 million in reclassifications of previously recorded lease incentives and deferred rent, offset by $141.4 million in restructured lease cease-use liability. Additionally, the Company has recorded total current lease liabilities of $180.7 million, and total noncurrent lease liabilities of $810.1 million. The adoption of ASC 842 did not have a material impact on the Company’s results of operations or any impact on the Company’s cash flows. The Company’s right-of use assets and lease liabilities relate to real estate, project assets used in connection with long-term construction contracts, IT assets and vehicles. The Company’s leases have remaining lease terms of one year to thirteen years. The Company’s lease obligations are primarily for the use of office space and are primarily operating leases. Certain of the Company’s leases contain renewal, extension, or termination options. The Company assesses each option on an individual basis and will only include options reasonably certain of exercise in the lease term. The Company generally considers the base term to be the term provided in the contract. None of the Company’s lease agreements contain material options to purchase the lease property, material residual value guarantees, or material restrictions or covenants. Long-term project asset and vehicle leases (leases with terms greater than twelve months), along with all real estate and IT asset leases, are recorded on the consolidated balance sheet at the present value of the minimum lease payments not yet paid. Because the Company primarily acts as a lessee and the rates implicit in its leases are not readily determinable, the Company generally uses its incremental borrowing rate on the lease commencement date to calculate the present value of future lease payments. Certain leases include payments that are based solely on an index or rate. These variable lease payments are included in the calculation of the ROU asset and lease liability and are initially measured using the index or rate at the lease commencement date. Other variable lease payments, such as payments based on use and for property taxes, insurance, or common area maintenance that are based on actual assessments are excluded from the ROU asset and lease liability, and are expensed as incurred. In addition to the present value of the future lease payments, the calculation of the ROU asset also includes any deferred rent, lease pre-payments and initial direct costs of obtaining the lease, such as commissions. Certain lease contracts contain nonlease components such as maintenance and utilities. The Company has made an accounting policy election, as allowed under ASC 842-10-15-37 and discussed above, to capitalize both the lease component and nonlease components of its contracts as a single lease component for all of its right-of-use assets. Short-term project asset and vehicle leases (project asset and vehicle leases with an initial term of twelve months or less or leases that are cancellable by the lessee and lessor without significant penalties) are not recorded on the consolidated balance sheet and are expensed on a straight-line basis over the lease term. The majority of the Company’s short-term leases relate to equipment used on construction projects. These leases are entered into at agreed upon hourly, daily, weekly or monthly rental rates for an unspecified duration and typically have a termination for convenience provision. Such equipment leases are considered short-term in nature unless it is reasonably certain that the equipment will be leased for a term greater than twelve months. The components of lease expense (reflected in selling, general and administrative expenses) for the three months ended December 27, 2019 were as follows (in thousands):
|  | Three Months Ended
|  | December 27, 2019
Lease cost |  |
Operating lease cost |  | $ | 44,080 |
Variable lease cost |  | 8,597 |
Sublease income |  | (3,334) |
Total lease cost |  | $ | 49,343 |
Information related to the Company's right-of use assets and lease liabilities as of December 27, 2019 was as follows (in thousands):
Lease Asset/Liabilities |  | Balance Sheet Classification |  | December 27, 2019
Right-of-use assets |  |  |  |
Operating lease assets |  | Miscellaneous assets |  | $ | 760,226 |
Lease Liabilities |  |  |  |  |
Operating lease liabilities, current |  | Accrued liabilities |  | 176,546 |
Operating lease liabilities, noncurrent |  | Other deferred liabilities |  | 804,749 |
Total lease liabilities |  |  |  | $ | 981,295 |
Supplemental information related to the Company's leases for the three months ended December 27, 2019 was as follows (in thousands):
|  | Three Months Ended
|  | December 27, 2019
Cash paid for amounts included in the measurements of lease liabilities |  | $ | 48,167 |
Right-of-use assets obtained in exchange for new operating lease liabilities |  | $ | 16,482 |
Weighted average remaining lease term - operating leases |  | 7.9 years |
Weighted average discount rate - operating leases |  | 2.7 | %
Total remaining lease payments under the Company's leases for the remainder of fiscal 2020 and for the succeeding years was as follows (in thousands):
Fiscal Year |  | Operating Leases
2020 |  | $ | 142,102 |
2021 |  | 169,480 |
2022 |  | 152,328 |
2023 |  | 135,567 |
2024 |  | 119,794 |
Thereafter |  | 374,113 |
|  | 1,093,384 |
Less Interest |  | (112,089) |
|  | $ | 981,295 |

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: | nonnum: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: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration