Leases

9 Months Ended

Sep. 28, 2024

The Company has operating leases for production, office and warehouse facilities, manufacturing and office equipment and vehicles. Operating lease assets and obligations included in the accompanying condensed consolidated balance sheets are shown below (in millions):


	September 28, 2024		December 31, 2023
Right-of-use assets under operating leases:
Other long-term assets	$	739.5	$	733.5
Lease obligations under operating leases:
Accrued liabilities	$	164.0	$	151.9
Other long-term liabilities	612.5		623.0
	$	776.5	$	774.9

Maturities of lease obligations as of September 28, 2024, are shown below (in millions):


	September 28, 2024
2024 (1)	$	51.8
2025	181.3
2026	153.7
2027	127.9
2028	103.9
Thereafter	257.5
Total undiscounted cash flows	876.1
Less: Imputed interest	(99.6)
Lease obligations under operating leases	$	776.5

(1) For the remaining three months

Cash flow information related to operating leases is shown below (in millions):


	Nine Months Ended
	September 28, 2024		September 30, 2023
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	132.8	$	152.4
Operating cash flows:
Cash paid related to operating lease obligations	$	143.3	$	137.0

In addition to the right-of-use assets obtained in exchange for operating lease obligations shown above, in the nine months ended September 30, 2023, the Company acquired $14.3 million of right-of-use assets and related lease obligations in conjunction with its acquisition of IGB (Note 2, "Acquisition").

Lease expense included in the accompanying condensed consolidated statements of comprehensive income (loss) is shown below (in millions):


	Three Months Ended				Nine Months Ended
	September 28, 2024		September 30, 2023		September 28, 2024		September 30, 2023
Operating lease expense	$	48.2	$	46.5	$	142.9	$	136.0
Short-term lease expense	4.5		5.2		15.4		15.4
Variable lease expense	2.3		2.3		6.4		7.3
Total lease expense	$	55.0	$	54.0	$	164.7	$	158.7

In the nine months ended September 28, 2024, the Company recognized impairment charges of $0.9 million related to its right-of-use assets. In the nine months ended September 30, 2023, the Company recognized impairment charges of $9.6 million related to its right-of-use assets in conjunction with its restructuring actions (Note 3, "Restructuring"). The impairment charges are included in cost of sales in the accompanying condensed consolidated statements of comprehensive income (loss).

The weighted average lease term and discount rate for operating leases are shown below:


	September 28, 2024
Weighted average remaining lease term	Six years
Weighted average discount rate	3.9	%

The Company is party to finance lease agreements, which are not material to the accompanying condensed consolidated financial statements (Note 8, "Debt").

For further information related to the Company's leases, see Note 8, "Leases," to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023.