Leases

9 Months Ended

Sep. 30, 2022

4. Leases

The Company leases its corporate headquarters, various other facilities for distribution, manufacturing, and offices, as well as vehicles, forklifts and other equipment. The Company determines if an arrangement is a lease at inception. Leases are included in "Right of use asset, leases" ("ROU Assets"), and the current portion of the lease liability is included in "Lease liabilities" and the non-current portion is included in "Long-term lease liabilities" in the Condensed Consolidated Balance Sheets. The Company currently has an immaterial amount of financing leases and leases with terms of more than one month and less than 12 months. ROU Assets and Lease liabilities are recognized based on the present value of lease payments over the lease term. Because most of the Company’s leases do not provide an implicit rate of return, the Company uses its incremental collateralized borrowing rate, on a regional basis, in determining the present value of lease payments. The incremental borrowing rate is dependent upon the duration of the lease and has been segmented into three groups of time. All leases within the same region and the same group of time share the same incremental borrowing rate. The Company has lease agreements with lease and non-lease components, which are combined for accounting purposes for all classes of assets except information technology equipment.

The components of lease expense were as follows:


		Three months ended September 30,								Nine Months Ended September 30,
(in millions)		2022				2021				2022				2021
Operating lease cost	$		7.0		$		8.1		$		22.5		$		22.3
Sublease income			(0.7	)			(0.9	)			(1.9	)			(1.5	)
Total lease cost	$		6.3		$		7.2		$		20.6		$		20.8

Other information related to leases was as follows:


		Nine Months Ended September 30,
(in millions, except lease term and discount rate)		2022			2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$		23.7	$		23.8
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$		7.8	$		15.0


	As of September 30, 2022
Weighted average remaining lease term:
Operating leases	6.4 years

Weighted average discount rate:
Operating leases		4.6	%

Future minimum lease payments, net of sub-lease income, for all non-cancelable leases as of September 30, 2022, were as follows:


(in millions)		Operating Leases
2022	$		6.6
2023			22.2
2024			18.5
2025			15.5
2026			12.5
2027			8.5
Thereafter			28.3
Total minimum lease payments			112.1
Less imputed interest			16.1
Future minimum payments for leases, net of sublease rental income and imputed interest	$		96.0