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Lease Accounting | 12 Months Ended
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Feb. 03, 2024
Leases [Abstract] |
Lease Accounting | Lease Accounting The Company primarily leases its showrooms, advertising, licensing, sales and merchandising offices, remote distribution and warehousing facilities and retail and factory outlet store locations under operating lease agreements expiring on various dates through January 2039. The Company also leases some of its equipment as well as computer hardware and software under operating and finance lease agreements expiring on various dates through December 2028. The Company’s lease agreements primarily provide for lease payments based on a minimum annual rental amount, a percentage of annual sales volume, periodic adjustments related to inflation or a combination of such lease payments. Certain retail store leases provide for lease payments based upon the minimum annual rental amount and a percentage of annual sales volume, generally ranging from 3% to 26%, when specific sales volumes are exceeded. The Company’s retail concession leases also provide for lease payments primarily based upon a percentage of annual sales volume which averages approximately 25%. In addition to the amounts as disclosed below, the Company has estimated additional operating lease commitments of approximately $34.5 million for leases where the Company has not yet taken possession of the underlying asset as of February 3, 2024. As such, the related operating lease ROU assets and operating lease liabilities have not been recognized in the Company’s consolidated balance sheet as of February 3, 2024. The components of leases are as follows (in thousands):
| Feb 3, 2024 |  | Jan 28, 2023 |  |  |
Assets |  |  |  | Balance Sheet Location |  |
Operating | $ | 667,031 |  |  | $ | 636,148 |  | Operating lease right-of-use assets |  |
Finance | 15,132 |  |  | 19,055 |  | Property and equipment, net |  |
Total lease assets | $ | 682,163 |  |  | $ | 655,203 |  |  |  |
Liabilities |  |  |  |  |  |
Current: |  |  |  |  |  |
Operating | $ | 166,451 |  |  | $ | 170,192 |  | Current portion of operating lease liabilities |  |
Finance | 5,573 |  |  | 6,684 |  | Current portion of borrowings and finance lease obligations |  |
Noncurrent: |  |  |  |  |  |
Operating | 542,392 |  |  | 528,236 |  | Long-term operating lease liabilities |  |
Finance | 9,857 |  |  | 13,181 |  | Long-term debt and finance lease obligations |  |
Total lease liabilities | $ | 724,273 |  |  | $ | 718,293 |  |  |  |
| Year Ended |
| Feb 3, 2024 |  | Jan 28, 2023 |  | Jan 29, 2022 |
|  |  |  |  |  | Income Statement Location
Operating lease costs | $ | 181,760 |  |  | $ | 175,752 |  |  | $ | 181,888 |  | Cost of product sales
Operating lease costs | 26,771 |  |  | 24,845 |  |  | 25,047 |  | Selling, general and administrative expenses
Operating lease costs 1 | (1,662) |  |  | (2,267) |  |  | (259) |  | Net gains on lease modifications
Finance lease costs |  |  |  |  |  |
Amortization of leased assets | 69 |  |  | 81 |  |  | 55 |  | Cost of product sales
Amortization of leased assets | 6,412 |  |  | 6,177 |  |  | 5,525 |  | Selling, general and administrative expenses
Interest on lease liabilities | 769 |  |  | 965 |  |  | 1,462 |  | Interest expense
Variable lease costs 2 | 101,056 |  |  | 92,331 |  |  | 75,339 |  | Cost of product sales
Variable lease costs 2 | 4,732 |  |  | 3,335 |  |  | 2,175 |  | Selling, general and administrative expenses
Short-term lease costs | 316 |  |  | 351 |  |  | 366 |  | Cost of product sales
Short-term lease costs | 6,005 |  |  | 6,141 |  |  | 4,856 |  | Selling, general and administrative expenses
Total lease costs | $ | 326,228 |  |  | $ | 307,711 |  |  | $ | 296,454 |  |
______________________________________________________________________ 1 During fiscal 2024, fiscal 2023 and fiscal 2022 net gains on lease modifications related primarily to the early termination of certain lease agreements. Operating lease costs for these retail locations prior to the early termination were included in cost of product sales. 2 During fiscal 2024, fiscal 2023 and fiscal 2022 variable lease costs included certain rent concessions received by the Company, primarily in Europe, of approximately $1.7 million, $5.2 million and $17.3 million, respectively. Maturities of the Company’s operating and finance lease liabilities as of February 3, 2024 are as follows (in thousands):
| Operating Leases |  |  |  |  |  |
| Non-Related Parties |  | Related Parties |  | Finance Leases |  | Total |  |
Maturity of Lease Liabilities: |  |  |  |  |  |  |  |  |
Fiscal 2025 | $ | 187,362 |  |  | $ | 8,337 |  |  | $ | 6,202 |  |  | $ | 201,901 |  |  |
Fiscal 2026 | 134,829 |  |  | 7,228 |  |  | 5,686 |  |  | 147,743 |  |  |
Fiscal 2027 | 118,529 |  |  | 7,785 |  |  | 3,170 |  |  | 129,484 |  |  |
Fiscal 2028 | 87,931 |  |  | 7,699 |  |  | 1,337 |  |  | 96,967 |  |  |
Fiscal 2029 | 69,087 |  |  | 8,464 |  |  | 284 |  |  | 77,835 |  |  |
Thereafter | 170,866 |  |  | 12,325 |  |  | — |  |  | 183,191 |  |  |
Total lease payments | 768,604 |  |  | 51,838 |  |  | 16,679 |  |  | 837,121 |  |  |
Less: Interest | 101,047 |  |  | 10,552 |  |  | 1,249 |  |  | 112,848 |  |  |
Present value of lease liabilities | $ | 667,557 |  |  | $ | 41,286 |  |  | $ | 15,430 |  |  | $ | 724,273 |  |  |
Other supplemental information is as follows (in thousands):
| Feb 3, 2024 |  |  |  |  |  |
Lease Term and Discount Rate: |  |  |  |  |  |  |
Weighted-average remaining lease term (years) |  |  |  |  |  |  |
Operating leases | 6.2 years |  |  |  |  |  |
Finance leases | 3.1 years |  |  |  |  |  |
Weighted-average discount rate |  |  |  |  |  |  |
Operating leases | 4.9% |  |  |  |  |  |
Finance leases | 5.1% |  |  |  |  |  |
| Year Ended |  |  |  |  |  |
| Feb 3, 2024 |  | Jan 28, 2023 |  | Jan 29, 2022 |  |  |  |  |  |
Supplemental Cash Flow Information: |  |  |  |  |  |  |  |  |  |  |
Cash paid for amounts included in the measurement of lease liabilities |  |  |  |  |  |  |  |  |  |  |
Operating cash flows from operating leases | $ | 207,575 |  |  | $ | 220,767 |  |  | $ | 225,652 |  |  |  |  |  |  |
New operating ROU assets obtained in exchange for lease liabilities | $ | 165,889 |  |  | $ | 131,363 |  |  | $ | 156,102 |  |  |  |  |  |  |
Lease Accounting | Lease Accounting The Company primarily leases its showrooms, advertising, licensing, sales and merchandising offices, remote distribution and warehousing facilities and retail and factory outlet store locations under operating lease agreements expiring on various dates through January 2039. The Company also leases some of its equipment as well as computer hardware and software under operating and finance lease agreements expiring on various dates through December 2028. The Company’s lease agreements primarily provide for lease payments based on a minimum annual rental amount, a percentage of annual sales volume, periodic adjustments related to inflation or a combination of such lease payments. Certain retail store leases provide for lease payments based upon the minimum annual rental amount and a percentage of annual sales volume, generally ranging from 3% to 26%, when specific sales volumes are exceeded. The Company’s retail concession leases also provide for lease payments primarily based upon a percentage of annual sales volume which averages approximately 25%. In addition to the amounts as disclosed below, the Company has estimated additional operating lease commitments of approximately $34.5 million for leases where the Company has not yet taken possession of the underlying asset as of February 3, 2024. As such, the related operating lease ROU assets and operating lease liabilities have not been recognized in the Company’s consolidated balance sheet as of February 3, 2024. The components of leases are as follows (in thousands):
| Feb 3, 2024 |  | Jan 28, 2023 |  |  |
Assets |  |  |  | Balance Sheet Location |  |
Operating | $ | 667,031 |  |  | $ | 636,148 |  | Operating lease right-of-use assets |  |
Finance | 15,132 |  |  | 19,055 |  | Property and equipment, net |  |
Total lease assets | $ | 682,163 |  |  | $ | 655,203 |  |  |  |
Liabilities |  |  |  |  |  |
Current: |  |  |  |  |  |
Operating | $ | 166,451 |  |  | $ | 170,192 |  | Current portion of operating lease liabilities |  |
Finance | 5,573 |  |  | 6,684 |  | Current portion of borrowings and finance lease obligations |  |
Noncurrent: |  |  |  |  |  |
Operating | 542,392 |  |  | 528,236 |  | Long-term operating lease liabilities |  |
Finance | 9,857 |  |  | 13,181 |  | Long-term debt and finance lease obligations |  |
Total lease liabilities | $ | 724,273 |  |  | $ | 718,293 |  |  |  |
| Year Ended |
| Feb 3, 2024 |  | Jan 28, 2023 |  | Jan 29, 2022 |
|  |  |  |  |  | Income Statement Location
Operating lease costs | $ | 181,760 |  |  | $ | 175,752 |  |  | $ | 181,888 |  | Cost of product sales
Operating lease costs | 26,771 |  |  | 24,845 |  |  | 25,047 |  | Selling, general and administrative expenses
Operating lease costs 1 | (1,662) |  |  | (2,267) |  |  | (259) |  | Net gains on lease modifications
Finance lease costs |  |  |  |  |  |
Amortization of leased assets | 69 |  |  | 81 |  |  | 55 |  | Cost of product sales
Amortization of leased assets | 6,412 |  |  | 6,177 |  |  | 5,525 |  | Selling, general and administrative expenses
Interest on lease liabilities | 769 |  |  | 965 |  |  | 1,462 |  | Interest expense
Variable lease costs 2 | 101,056 |  |  | 92,331 |  |  | 75,339 |  | Cost of product sales
Variable lease costs 2 | 4,732 |  |  | 3,335 |  |  | 2,175 |  | Selling, general and administrative expenses
Short-term lease costs | 316 |  |  | 351 |  |  | 366 |  | Cost of product sales
Short-term lease costs | 6,005 |  |  | 6,141 |  |  | 4,856 |  | Selling, general and administrative expenses
Total lease costs | $ | 326,228 |  |  | $ | 307,711 |  |  | $ | 296,454 |  |
______________________________________________________________________ 1 During fiscal 2024, fiscal 2023 and fiscal 2022 net gains on lease modifications related primarily to the early termination of certain lease agreements. Operating lease costs for these retail locations prior to the early termination were included in cost of product sales. 2 During fiscal 2024, fiscal 2023 and fiscal 2022 variable lease costs included certain rent concessions received by the Company, primarily in Europe, of approximately $1.7 million, $5.2 million and $17.3 million, respectively. Maturities of the Company’s operating and finance lease liabilities as of February 3, 2024 are as follows (in thousands):
| Operating Leases |  |  |  |  |  |
| Non-Related Parties |  | Related Parties |  | Finance Leases |  | Total |  |
Maturity of Lease Liabilities: |  |  |  |  |  |  |  |  |
Fiscal 2025 | $ | 187,362 |  |  | $ | 8,337 |  |  | $ | 6,202 |  |  | $ | 201,901 |  |  |
Fiscal 2026 | 134,829 |  |  | 7,228 |  |  | 5,686 |  |  | 147,743 |  |  |
Fiscal 2027 | 118,529 |  |  | 7,785 |  |  | 3,170 |  |  | 129,484 |  |  |
Fiscal 2028 | 87,931 |  |  | 7,699 |  |  | 1,337 |  |  | 96,967 |  |  |
Fiscal 2029 | 69,087 |  |  | 8,464 |  |  | 284 |  |  | 77,835 |  |  |
Thereafter | 170,866 |  |  | 12,325 |  |  | — |  |  | 183,191 |  |  |
Total lease payments | 768,604 |  |  | 51,838 |  |  | 16,679 |  |  | 837,121 |  |  |
Less: Interest | 101,047 |  |  | 10,552 |  |  | 1,249 |  |  | 112,848 |  |  |
Present value of lease liabilities | $ | 667,557 |  |  | $ | 41,286 |  |  | $ | 15,430 |  |  | $ | 724,273 |  |  |
Other supplemental information is as follows (in thousands):
| Feb 3, 2024 |  |  |  |  |  |
Lease Term and Discount Rate: |  |  |  |  |  |  |
Weighted-average remaining lease term (years) |  |  |  |  |  |  |
Operating leases | 6.2 years |  |  |  |  |  |
Finance leases | 3.1 years |  |  |  |  |  |
Weighted-average discount rate |  |  |  |  |  |  |
Operating leases | 4.9% |  |  |  |  |  |
Finance leases | 5.1% |  |  |  |  |  |
| Year Ended |  |  |  |  |  |
| Feb 3, 2024 |  | Jan 28, 2023 |  | Jan 29, 2022 |  |  |  |  |  |
Supplemental Cash Flow Information: |  |  |  |  |  |  |  |  |  |  |
Cash paid for amounts included in the measurement of lease liabilities |  |  |  |  |  |  |  |  |  |  |
Operating cash flows from operating leases | $ | 207,575 |  |  | $ | 220,767 |  |  | $ | 225,652 |  |  |  |  |  |  |
New operating ROU assets obtained in exchange for lease liabilities | $ | 165,889 |  |  | $ | 131,363 |  |  | $ | 156,102 |  |  |  |  |  |  |

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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 -Topic 842 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//842-20/tableOfContent + 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 -Topic 842 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//842-20/tableOfContent + Details
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