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Leases | 6 Months Ended
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Jun. 30, 2019
Leases [Abstract] |
Lessee, Finance Leases [Text Block] | Leases The Company’s lease portfolio mainly consists of retail stores, warehouses, distribution centers, office space, and, to a lesser extent, equipment. The Company’s accounting for finance leases (previously called capital leases) remains substantially unchanged. Finance leases are generally those leases that allow the Company to substantially utilize or pay for the entire asset over its estimated life. Assets acquired under finance leases are recorded in property, plant and equipment, net. All other leases are categorized as operating leases. Operating lease assets represent the Company’s right to use an underlying asset for the lease term whereas lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. These rates are assessed on a quarterly basis. The operating lease assets also include any lease payments made less lease incentives. Leases with an initial term of 12 months or less are not recorded on the balance sheet. For operating leases, expense is recognized on a straight-line basis over the lease term. For finance leases, the Company recognizes a front-loaded pattern of total lease expense recognition due to the accretion of the lease liability and the straight-line amortization of the leased asset. Many leases include one or more options to renew, with renewal terms that can extend the lease term for three years or more. The exercise of lease renewal options is at the Company’s sole discretion. Certain leases also include options to purchase the leased assets. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. The Company also has lease agreements with lease and non-lease components, which are accounted for as a single lease component. Additionally, for certain non-real estate leases, the portfolio approach is used to effectively account for the operating lease assets and liabilities. Supplemental condensed consolidated balance sheet information related to leases for the period indicated, is as follows (in millions):
| Classification |  | June 30, 2019
Assets |  |  |
Operating leases | Operating lease assets, net |  | $ | 646.0 |
Finance leases | Property, plant and equipment, net (1) |  | 17.6 |
Total lease assets |  |  | $ | 663.6 |
Liabilities |  |  |
Current |  |  |
Operating leases | Other accrued liabilities |  | $ | 128.3 |
Finance leases | Short-term debt and current portion of long-term debt |  | 3.5 |
Noncurrent |  |  |
Operating leases | Long-term operating lease liabilities |  | 572.7 |
Finance leases | Long-term debt |  | 11.4 |
Total lease liabilities |  |  | $ | 715.9 |
(1) | Net of accumulated depreciation of $6.1 million.
Components of lease expense as of the date indicated, are as follows (in millions):
| Three Months Ended June 30, 2019 |  | Six Months Ended June 30, 2019
Operating lease cost: |  |  |
Operating lease cost (1) | $ | 49.4 |  |  | $ | 97.6 |
Variable lease costs (2) | 6.0 |  |  | 12.0 |
Finance lease cost: |  |  |
Amortization of leased assets | 1.2 |  |  | 2.3 |
Interest on lease liabilities | 0.1 |  |  | 0.3 |
(1) | Includes short-term leases, which are immaterial.
(2) | Consists primarily of additional payments for non-lease components, such as maintenance costs, payments of taxes and additional rent based on a level of the Company’s retail store sales.
Remaining lease term and discount rates as of the date indicated, are as follows:
| June 30, 2019
Weighted-average remaining lease term (years): |  |  |
Operating leases | 7
Finance leases | 4
Weighted-average discount rate: |  |  |
Operating leases | 4.3%
Finance leases | 3.4%
Supplemental cash flow information related to leases for the period indicated is as follows (in millions):
| Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities: |
Operating cash flows from operating leases | $ | 94.1 |
Operating cash flows from finance leases | 0.3 |
Financing cash flows from finance leases | 1.7 |
Right of use assets obtained in exchange for lease liabilities: |
Operating leases | 100.6 |
Finance leases | 6.7 |
Maturities of lease liabilities for continuing operations under the new lease standard (see Footnote 1) as of June 30, 2019, are as follows (in millions):
| Operating Leases |  | Finance Leases
2019 (Excludes six months ended June 30, 2019) | $ | 80.3 |  |  | $ | 2.2 |
2020 | 150.9 |  |  | 4.3 |
2021 | 124.5 |  |  | 4.2 |
2022 | 104.9 |  |  | 3.3 |
2023 | 84.3 |  |  | 1.5 |
Thereafter | 283.7 |  |  | 0.4 |
Total lease payments | 828.6 |  |  | 15.9 |
Less: imputed interest | (127.6 | ) |  | (1.0 | )
Present value of lease liabilities | $ | 701.0 |  |  | $ | 14.9 |
See Footnote 2 for information on lease liabilities included in discontinued operations and held for sale. Future minimum rental payments for operating leases, prior to the adoption of the new lease standard, with initial or remaining terms in excess of one year at December 31, 2018 for the consolidated Company are as follows (in millions):
| Operating Leases
2019 | $ | 180.0 |
2020 | 144.0 |
2021 | 117.8 |
2022 | 97.7 |
2023 | 74.0 |
Thereafter | 263.9 |
Total lease payments | $ | 877.4 |
Rent expense under operating leases for continuing operations was $52.5 million and $105.2 million, respectively, during the three and six months ended June 30, 2018.
Leases | Leases The Company’s lease portfolio mainly consists of retail stores, warehouses, distribution centers, office space, and, to a lesser extent, equipment. The Company’s accounting for finance leases (previously called capital leases) remains substantially unchanged. Finance leases are generally those leases that allow the Company to substantially utilize or pay for the entire asset over its estimated life. Assets acquired under finance leases are recorded in property, plant and equipment, net. All other leases are categorized as operating leases. Operating lease assets represent the Company’s right to use an underlying asset for the lease term whereas lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. These rates are assessed on a quarterly basis. The operating lease assets also include any lease payments made less lease incentives. Leases with an initial term of 12 months or less are not recorded on the balance sheet. For operating leases, expense is recognized on a straight-line basis over the lease term. For finance leases, the Company recognizes a front-loaded pattern of total lease expense recognition due to the accretion of the lease liability and the straight-line amortization of the leased asset. Many leases include one or more options to renew, with renewal terms that can extend the lease term for three years or more. The exercise of lease renewal options is at the Company’s sole discretion. Certain leases also include options to purchase the leased assets. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. The Company also has lease agreements with lease and non-lease components, which are accounted for as a single lease component. Additionally, for certain non-real estate leases, the portfolio approach is used to effectively account for the operating lease assets and liabilities. Supplemental condensed consolidated balance sheet information related to leases for the period indicated, is as follows (in millions):
| Classification |  | June 30, 2019
Assets |  |  |
Operating leases | Operating lease assets, net |  | $ | 646.0 |
Finance leases | Property, plant and equipment, net (1) |  | 17.6 |
Total lease assets |  |  | $ | 663.6 |
Liabilities |  |  |
Current |  |  |
Operating leases | Other accrued liabilities |  | $ | 128.3 |
Finance leases | Short-term debt and current portion of long-term debt |  | 3.5 |
Noncurrent |  |  |
Operating leases | Long-term operating lease liabilities |  | 572.7 |
Finance leases | Long-term debt |  | 11.4 |
Total lease liabilities |  |  | $ | 715.9 |
(1) | Net of accumulated depreciation of $6.1 million.
Components of lease expense as of the date indicated, are as follows (in millions):
| Three Months Ended June 30, 2019 |  | Six Months Ended June 30, 2019
Operating lease cost: |  |  |
Operating lease cost (1) | $ | 49.4 |  |  | $ | 97.6 |
Variable lease costs (2) | 6.0 |  |  | 12.0 |
Finance lease cost: |  |  |
Amortization of leased assets | 1.2 |  |  | 2.3 |
Interest on lease liabilities | 0.1 |  |  | 0.3 |
(1) | Includes short-term leases, which are immaterial.
(2) | Consists primarily of additional payments for non-lease components, such as maintenance costs, payments of taxes and additional rent based on a level of the Company’s retail store sales.
Remaining lease term and discount rates as of the date indicated, are as follows:
| June 30, 2019
Weighted-average remaining lease term (years): |  |  |
Operating leases | 7
Finance leases | 4
Weighted-average discount rate: |  |  |
Operating leases | 4.3%
Finance leases | 3.4%
Supplemental cash flow information related to leases for the period indicated is as follows (in millions):
| Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities: |
Operating cash flows from operating leases | $ | 94.1 |
Operating cash flows from finance leases | 0.3 |
Financing cash flows from finance leases | 1.7 |
Right of use assets obtained in exchange for lease liabilities: |
Operating leases | 100.6 |
Finance leases | 6.7 |
Maturities of lease liabilities for continuing operations under the new lease standard (see Footnote 1) as of June 30, 2019, are as follows (in millions):
| Operating Leases |  | Finance Leases
2019 (Excludes six months ended June 30, 2019) | $ | 80.3 |  |  | $ | 2.2 |
2020 | 150.9 |  |  | 4.3 |
2021 | 124.5 |  |  | 4.2 |
2022 | 104.9 |  |  | 3.3 |
2023 | 84.3 |  |  | 1.5 |
Thereafter | 283.7 |  |  | 0.4 |
Total lease payments | 828.6 |  |  | 15.9 |
Less: imputed interest | (127.6 | ) |  | (1.0 | )
Present value of lease liabilities | $ | 701.0 |  |  | $ | 14.9 |
See Footnote 2 for information on lease liabilities included in discontinued operations and held for sale. Future minimum rental payments for operating leases, prior to the adoption of the new lease standard, with initial or remaining terms in excess of one year at December 31, 2018 for the consolidated Company are as follows (in millions):
| Operating Leases
2019 | $ | 180.0 |
2020 | 144.0 |
2021 | 117.8 |
2022 | 97.7 |
2023 | 74.0 |
Thereafter | 263.9 |
Total lease payments | $ | 877.4 |
Rent expense under operating leases for continuing operations was $52.5 million and $105.2 million, respectively, during the three and six months ended June 30, 2018.

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- 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
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- 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
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