Leases

12 Months Ended

Jun. 03, 2023

The Company has leases for retail stores, showrooms, manufacturing facilities, warehouses and vehicles, which expire at various dates through 2042. Certain lease agreements include contingent rental payments based on per unit usage over a contractual amount and others include rental payments adjusted periodically for inflationary indexes.

The Company's lease costs recognized in the Consolidated Statement of Income consist of the following:


	Year Ended		Year Ended
(In millions)	June 3, 2023		May 28, 2022
Operating lease costs	$	99.3	$	89.4
Short-term lease costs	11.2		10.4
Variable lease costs	12.0		10.3
Total	$	122.5	$	110.1

Included in the Company's Right-of-use assets and Lease liabilities are variable lease costs, not included in the table above, for raw material purchases under certain supply arrangements that the Company has determined to meet the definition of a lease:


	Year Ended		Year Ended
	June 3, 2023		May 28, 2022
Variable lease costs	$	96.2	$	95.6

During fiscal 2023, the Company determined it was more likely than not that the fair value of certain right of use assets within the Global Retail reporting unit, specifically Fully, were below their carrying value and assessed these assets for impairment. As

a result of this assessment, the Company recorded an impairment of $6.1 million in the Consolidated Statements of Comprehensive income.

At June 3, 2023, the Company has no financing leases. The undiscounted annual future minimum lease payments related to the Company's right-of-use assets are summarized by fiscal year in the following table:


(In millions)
2024	$	81.5
2025	92.3
2026	79.1
2027	65.4
2028	58.5
Thereafter	185.0
Total lease payments*	$	561.8
Less interest	91.0
Present value of lease liabilities	$	470.8

*Lease payments exclude $2.2 million of legally binding minimum lease payments for leases signed but not yet commenced.

Supplemental cash flow and other lease information as of and for periods indicated, includes (dollars in millions):


	Year Ended			Year Ended
	June 3, 2023			May 28, 2022
Weighted-average remaining lease term (in years)
Operating leases	6.9			7.1
Weighted-average discount rate
Operating leases	2.4		%	1.9		%

Cash paid for amounts included in the measurement of lease liabilities
Operating cash flow from operating leases	$	100.0		$	85.7
ROU assets obtained in exchange for new operating lease liabilities
Operating leases	$	63.0		$	89.1