Leases

6 Months Ended

Jun. 30, 2022

(16) LEASES

We enter into operating leases for ATM sites, office spaces, retail stores and equipment. Our finance leases are immaterial. Right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease terms.

The present value of lease payments is determined using the incremental borrowing rate based on information available at the lease commencement date. We recognize lease expense for these leases on a straight-line basis over the lease term.

Most leases include an option to renew, with renewal terms that can extend the lease terms. The exercise of lease renewal options is at our sole discretion. The depreciable life of assets and leasehold improvements are limited by the expected lease terms. We also have a unilateral termination right for most of the ATM site leases. Since we are not reasonably certain not to exercise termination options, payments for ATM site leases with termination options subject to the short-term lease exemption are expensed in the period incurred and corresponding leases are excluded from the right of use lease asset and lease liability balances. Certain of our lease agreements include variable rental payments based on revenues generated from the use of the leased location and certain leases include rental payments adjusted periodically for inflation. Variable lease payments are recognized when the event, activity or circumstance in the lease agreement on which those payments are assessed occurs and are excluded from the right of use assets and lease liabilities balances. The lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Future minimum lease payments

Future minimum lease payments under non-cancelable operating leases (with initial lease terms in excess of one year) as of June 30, 2022 are:

	As of June 30, 2022
Maturity of Lease Liabilities (in thousands)	Operating Leases (1)
Remainder of 2022	$	23,650
2023	40,041
2024	30,569
2025	21,923
2026	15,380
Thereafter	25,379
Total lease payments	$	156,942
Less: imputed interest	(4,418		)
Present value of lease liabilities	$	152,524

(1) Operating lease payments reflect our current fixed obligations under the operating lease agreements.

Lease expense recognized in the Consolidated Statements of Income is summarized as follows:

Lease Expense (in thousands)	Income Statement Classification	Three Months Ended June 30, 2022		Three Months Ended June 30, 2021			Six Months Ended June 30, 2022		Six Months Ended June 30, 2021
Operating lease expense	Selling, general and administrative and Direct operating costs	$	13,027	$	14,146	$	26,544	$	28,004
Short-term and variable lease expense	Selling, general and administrative and Direct operating costs		30,212		26,921		59,935		49,471
Total lease expense		$	43,239	$	41,067	$	86,479	$	77,475

Other information about lease amounts recognized in the consolidated financial statements is summarized as follows:


Lease Term and Discount Rate of Operating Leases	As of June 30, 2022
Weighted- average remaining lease term (years)	4.9
Weighted- average discount rate	2.3	%

The following table presents supplemental cash flow and non-cash information related to leases.


Other Information (in thousands)	Six Months Ended June 30, 2022		Six Months Ended June 30, 2021
Cash paid for amounts included in the measurement of lease liabilities (a)	$	26,116	$	26,321
Supplemental non-cash information on lease liabilities arising from obtaining ROU assets:
ROU assets obtained in exchange for new operating lease liabilities	$	21,492	$	49,270

(a) Included in Net cash provided by operating activities on our Consolidated Statements of Cash Flows.