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LEASES | 12 Months Ended
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Jun. 26, 2024
Leases [Abstract] |
LEASES | As of June 26, 2024, 1,121 of our 1,171 Company-owned restaurant facilities were leased. We typically lease our restaurant facilities through ground leases (where we lease land only, but construct the building and leasehold improvements) or retail leases (where we lease the land/retail space and building, but construct the leasehold improvements). As of June 26, 2024, the restaurant leases have cumulative renewal clauses of 3 to 30 years at our option. Our leased restaurants typically have an initial lease term of 10 to 20 years, with one or more renewal terms ranging from 1 to 10 years. The leases typically provide for a fixed rental or a fixed rental plus percentage rentals based on sales volume. In addition to our restaurant facilities, we also lease our corporate headquarters location and certain equipment. Our lease agreements do not contain any material residual value guarantees or material covenant restrictions. Consolidated Balance Sheet Disclosure of Lease Amounts The following table includes a detail of lease assets and liabilities included in the Consolidated Balance Sheets:
| June 26, 2024
| Finance Leases(1) |  | Operating Leases(2) |  | Total Leases
Lease assets | $ | 93.4 |  |  | $ | 1,095.2 |  |  | $ | 1,188.6 |
Current lease liabilities | 14.1 |  |  | 114.1 |  |  | 128.2 |
Long-term lease liabilities | 91.3 |  |  | 1,084.5 |  |  | 1,175.8 |
Total lease liabilities | $ | 105.4 |  |  | $ | 1,198.6 |  |  | $ | 1,304.0 |
| June 28, 2023
| Finance Leases(1) |  | Operating Leases(2) |  | Total Leases
Lease assets | $ | 51.3 |  |  | $ | 1,134.9 |  |  | $ | 1,186.2 |
Current lease liabilities | 10.2 |  |  | 112.4 |  |  | 122.6 |
Long-term lease liabilities | 57.6 |  |  | 1,125.8 |  |  | 1,183.4 |
Total lease liabilities | $ | 67.8 |  |  | $ | 1,238.2 |  |  | $ | 1,306.0 |
(1)Finance lease assets are recorded in Property and equipment, at cost, and the related current and long-term lease liabilities are recorded within Other accrued liabilities and Long-term debt and finance leases, less current installments, respectively. (2)Operating lease assets are recorded in Operating lease assets and the related current and long-term lease liabilities are recorded within Operating lease liabilities and Long-term operating lease liabilities, less current portion, respectively. Consolidated Statement of Comprehensive Income Disclosure of Lease Amounts The components of lease expenses, including variable lease costs primarily consisting of rent based on a percentage of sales, common area maintenance and real estate tax charges, and short-term lease expenses for leases with lease terms less than twelve months are included in the Consolidated Statements of Comprehensive Income as follows:
| Fiscal Years Ended
| June 26, 2024 |  | June 28, 2023 |  | June 29, 2022
Operating lease cost | $ | 182.5 |  |  | $ | 181.0 |  |  | $ | 173.7 |
Finance lease amortization | 14.0 |  |  | 19.7 |  |  | 21.9 |
Finance lease interest | 4.2 |  |  | 4.1 |  |  | 5.5 |
Short-term lease cost | 0.3 |  |  | 0.3 |  |  | 0.6 |
Variable lease cost | 63.4 |  |  | 63.5 |  |  | 60.5 |
Sublease income | (1.2) |  |  | (2.8) |  |  | (4.2) |
Total lease costs, net | $ | 263.2 |  |  | $ | 265.8 |  |  | $ | 258.0 |
Consolidated Statement of Cash Flows Disclosure of Lease Amounts Supplemental cash flow information related to leases recorded in the Consolidated Statements of Cash Flows is as follows:
| Fiscal Years Ended
| June 26, 2024 |  | June 28, 2023 |  | June 29, 2022
Cash flows from operating activities |  |  |  |  |
Cash paid related to lease liabilities |  |  |  |  |
Operating leases | $ | 186.3 |  |  | $ | 184.3 |  |  | $ | 171.1 |
Finance leases | 4.2 |  |  | 4.1 |  |  | 5.5 |
Cash flows from financing activities |  |  |  |  |
Cash paid related to lease liabilities |  |  |  |  |
Finance leases | 20.1 |  |  | 22.1 |  |  | 23.7 |
Non-cash lease assets obtained in exchange for lease liabilities |  |  |  |  |
Operating leases(1) | 82.6 |  |  | 101.7 |  |  | 255.4 |
Finance leases | 53.7 |  |  | 0.3 |  |  | 13.4 |
(1)Non-cash operating lease assets obtained in exchange for operating lease liabilities were higher in fiscal 2022 primarily due to the new and assumed operating lease additions associated with the 68 restaurants purchased from three former franchisees, including sale leaseback transactions on six of the acquired restaurants. The combined transactions resulted in increased operating lease assets of $86.8 million as of the end of fiscal 2022, and cash proceeds of $20.5 million were received from the sale leaseback transactions. Additionally, the modifications of 25 leases in fiscal 2022 from finance leases to operating leases, resulted in increased operating lease assets of $47.9 million. Weighted Average Lease Term and Discount Rate Other information related to leases is as follows:
| Fiscal Years Ended
| June 26, 2024 |  | June 28, 2023
| Finance Leases |  | Operating Leases |  | Finance Leases |  | Operating Leases
Weighted average remaining lease term | 7.4 years |  | 11.6 years |  | 9.9 years |  | 11.8 years
Weighted average discount rate | 5.9 | % |  | 6.0 | % |  | 5.5 | % |  | 5.8 | %
Lease Maturity Analysis Finance leases and Operating leases total future lease payments represent the contractual obligations due under the lease agreements, including cancellable option periods where we are reasonably assured to exercise the options. As of June 26, 2024, the future minimum lease payments on finance and operating leases, as well as sublease income were as follows:
| June 26, 2024
Fiscal Year | Finance Leases |  | Operating Leases |  | Sublease Income
2025 | $ | 19.8 |  |  | $ | 180.7 |  |  | $ | 0.9 |
2026 | 22.9 |  |  | 174.8 |  |  | 0.8 |
2027 | 22.8 |  |  | 157.6 |  |  | 0.7 |
2028 | 22.9 |  |  | 139.1 |  |  | 0.4 |
2029 | 8.4 |  |  | 128.8 |  |  | 0.3 |
Thereafter | 33.4 |  |  | 917.0 |  |  | 0.5 |
Total future lease payments | 130.2 |  |  | 1,698.0 |  |  | $ | 3.6 |
Less: Imputed interest | 24.8 |  |  | 499.4 |  |  |
Present value of lease liability | $ | 105.4 |  |  | $ | 1,198.6 |  |  |
Pre-Commencement Leases In fiscal 2024, we executed four leases for new Chili’s locations and one lease for a new Maggiano’s location with undiscounted fixed payments over the initial term of $15.5 million. These leases will commence when the landlords make the property available to us for new restaurant construction. We will assess the reasonably certain lease term at the lease commencement date.

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