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LEASES

12 Months Ended

Sep. 30, 2022

Leases [Abstract]

LEASES

LEASES

The Company has leases primarily pertaining to manufacturing facilities, distribution centers, office space, warehouses, automobiles, machinery, computers, and office equipment that expire at various times through June 2035. We have embedded operating leases within certain third-party logistic agreements for certain warehousing and information technology services arrangements and recognized right of use assets identified in the arrangements as part of Operating Lease Assets on the Company’s Consolidated Statement of Financial Position. We elected to exclude certain supply chain contracts that contain embedded leases for manufacturing facilities or dedicated manufacturing lines from our ROU asset and liability calculation based on the insignificant impact to our consolidated financial statements.

The following is a summary of the Company’s leases recognized on the Company’s Consolidated Statement of Financial Position as of September 30, 2022 and 2021:

(in millions)						Line Item						2022						2021
Assets
Operating						Operating lease assets						$	82.5					$	56.5
Finance						Property, plant and equipment, net						73.4						84.2
Total leased assets												$	155.9					$	140.7
Liabilities
Current
Operating						Other current liabilities						$	25.8					$	17.4
Finance						Current portion of long-term debt						8.3						7.9
Long-term
Operating						Long-term operating lease liabilities						56.0						44.5
Finance						Long-term debt, net of current portion						84.4						94.0
Total lease liabilities												$	174.5					$	163.8

As of September 30, 2022, the Company had no significant commitments related to leases executed that have not yet commenced.

The Company records its operating lease and amortization of finance lease ROU assets within Cost of Goods Sold or Operating Expenses in the Consolidated Statement of Income depending on the nature and use of the underlying asset. The Company records its finance interest cost within interest expense in the Consolidated Statement of Income.

The components of lease costs recognized in the Consolidated Statement of Income for the year ended September 30, 2022, 2021, and 2020 are as follows:

(in millions)						2022						2021						2020
Operating lease cost						$	26.3					$	19.8					$	15.6
Finance lease cost
Amortization of leased assets						10.5						11.3						11.8
Interest on lease liability						5.2						5.3						5.7
Variable lease cost						10.8						9.8						9.8
Total lease cost						$	52.8					$	46.2					$	42.9

During the year ended September 30, 2022, 2021, and 2020 the Company recognized income attributable to leases and sub-leases of $2.7 million, $2.3 million, and $2.1 million, respectively. Income from leases and sub-leases is recognized as Other Non-Operating Income on the Consolidated Statement of Income.

The following is a summary of the Company’s cash paid for amounts included in the measurement of lease liabilities recognized in the Consolidated Statement of Cash Flow, including supplemental non-cash activity related to operating leases, for the year ended September 30, 2022, 2021, and 2020:

(in millions)						2022						2021						2020
Operating cash flow from operating leases						$	25.3					$	20.7					$	16.1
Operating cash flows from finance leases						5.1						5.4						5.7
Financing cash flows from finance leases						8.9						12.0						10.6
Supplemental non-cash flow disclosure
Acquisition of operating lease asset through lease obligations						30.4						15.3						23.6

The following is a summary of weighted-average lease term and discount rate at September 30, 2022 and 2021:

						2022						2021
Weighted average remaining lease term
Operating leases						4.5 years						4.6 years
Finance leases						9.7 years						10.4 years
Weighted average discount rate
Operating leases						3.8		%				4.3		%
Finance leases						5.1		%				4.9		%

At September 30, 2022, future lease payments under operating and finance leases were as follows:

(in millions)						Finance Leases						Operating Leases
2023						$	12.5					$	28.4
2024						13.2						18.5
2025						11.9						14.8
2026						11.6						10.2
2027						11.7						6.6
Thereafter						57.9						11.4
Total lease payments						118.8						89.9
Amount representing interest						(26.1)						(8.1)
Total minimum lease payments						$	92.7					$	81.8

LEASES

LEASES

The Company has leases primarily pertaining to manufacturing facilities, distribution centers, office space, warehouses, automobiles, machinery, computers, and office equipment that expire at various times through June 2035. We have embedded operating leases within certain third-party logistic agreements for certain warehousing and information technology services arrangements and recognized right of use assets identified in the arrangements as part of Operating Lease Assets on the Company’s Consolidated Statement of Financial Position. We elected to exclude certain supply chain contracts that contain embedded leases for manufacturing facilities or dedicated manufacturing lines from our ROU asset and liability calculation based on the insignificant impact to our consolidated financial statements.

The following is a summary of the Company’s leases recognized on the Company’s Consolidated Statement of Financial Position as of September 30, 2022 and 2021:

(in millions)						Line Item						2022						2021
Assets
Operating						Operating lease assets						$	82.5					$	56.5
Finance						Property, plant and equipment, net						73.4						84.2
Total leased assets												$	155.9					$	140.7
Liabilities
Current
Operating						Other current liabilities						$	25.8					$	17.4
Finance						Current portion of long-term debt						8.3						7.9
Long-term
Operating						Long-term operating lease liabilities						56.0						44.5
Finance						Long-term debt, net of current portion						84.4						94.0
Total lease liabilities												$	174.5					$	163.8

As of September 30, 2022, the Company had no significant commitments related to leases executed that have not yet commenced.

The Company records its operating lease and amortization of finance lease ROU assets within Cost of Goods Sold or Operating Expenses in the Consolidated Statement of Income depending on the nature and use of the underlying asset. The Company records its finance interest cost within interest expense in the Consolidated Statement of Income.

The components of lease costs recognized in the Consolidated Statement of Income for the year ended September 30, 2022, 2021, and 2020 are as follows:

(in millions)						2022						2021						2020
Operating lease cost						$	26.3					$	19.8					$	15.6
Finance lease cost
Amortization of leased assets						10.5						11.3						11.8
Interest on lease liability						5.2						5.3						5.7
Variable lease cost						10.8						9.8						9.8
Total lease cost						$	52.8					$	46.2					$	42.9

During the year ended September 30, 2022, 2021, and 2020 the Company recognized income attributable to leases and sub-leases of $2.7 million, $2.3 million, and $2.1 million, respectively. Income from leases and sub-leases is recognized as Other Non-Operating Income on the Consolidated Statement of Income.

The following is a summary of the Company’s cash paid for amounts included in the measurement of lease liabilities recognized in the Consolidated Statement of Cash Flow, including supplemental non-cash activity related to operating leases, for the year ended September 30, 2022, 2021, and 2020:

(in millions)						2022						2021						2020
Operating cash flow from operating leases						$	25.3					$	20.7					$	16.1
Operating cash flows from finance leases						5.1						5.4						5.7
Financing cash flows from finance leases						8.9						12.0						10.6
Supplemental non-cash flow disclosure
Acquisition of operating lease asset through lease obligations						30.4						15.3						23.6

The following is a summary of weighted-average lease term and discount rate at September 30, 2022 and 2021:

						2022						2021
Weighted average remaining lease term
Operating leases						4.5 years						4.6 years
Finance leases						9.7 years						10.4 years
Weighted average discount rate
Operating leases						3.8		%				4.3		%
Finance leases						5.1		%				4.9		%

At September 30, 2022, future lease payments under operating and finance leases were as follows:

(in millions)						Finance Leases						Operating Leases
2023						$	12.5					$	28.4
2024						13.2						18.5
2025						11.9						14.8
2026						11.6						10.2
2027						11.7						6.6
Thereafter						57.9						11.4
Total lease payments						118.8						89.9
Amount representing interest						(26.1)						(8.1)
Total minimum lease payments						$	92.7					$	81.8

X

- References

No definition available.

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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 https://asc.fasb.org/subtopic&trid=77888251

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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 https://asc.fasb.org/subtopic&trid=77888251

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