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Leases

3 Months Ended

Apr. 30, 2022

(6) Leases

At the inception of the lease, the Company’s operating leases have remaining certain lease terms of up to 15 years, which typically includes multiple options for the Company to extend the lease which are not reasonably certain.

The Company determines whether a contract is or contains a lease at contract inception. As the rate implicit in the lease is not readily determinable in most of the Company’s leases, it uses its incremental borrowing rate based on the information available at commencement date to determine the present value of lease payments. The Company's incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. The operating lease asset also includes any fixed lease payments made and includes lease incentives and incurred initial direct costs. Operating lease expense for fixed lease payments is recognized on a straight-line basis over the lease term. The Company’s lease terms may include options to extend or terminate the lease. Additionally, the Company’s leases do not contain any material residual guarantees or material restrictive covenants.

In the 13 weeks ended April 30, 2022, the Company recorded a non-cash increase of $6,378 to the right of use assets and operating lease liabilities resulting from lease remeasurements from the exercise of lease extension options, acquired leases, and new leases added.

The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

In accordance with ASC 842, total lease expense was comprised of the following:



	Thirteen Weeks Ended
	April 30,		May 1,
	2022		2021
Operating lease expense	$	14,395	$	13,866
Variable lease expense		4,302		4,275
Short-term lease expense		270		257
Total lease expense	$	18,967	$	18,398

In accordance with ASC 842, other information related to leases was as follows:


	Thirteen Weeks Ended
	April 30,		May 1,
	2022		2021
Operating cash flows from operating leases	$	(15,520)	$	(14,561)
Cash paid for lease liabilities - operating leases		(15,520)		(14,561)

	As of April 30,		As of May 1,
	2022		2021

Right-of-use assets obtained in exchange for new or remeasured operating lease liabilities	$	6,378	$	5,559
Terminated right-of-use assets and liabilities		—		—
Weighted-average remaining lease term - operating leases		5.66		5.96
Weighted-average discount rate - operating leases		8.21%		8.39%

In accordance with ASC 842, maturities of operating lease liabilities as of April 30, 2022 were as follows:


	Operating
Year Endings:	Leases
2022 (remainder)	$	47,761
2023		60,016
2024		51,513
2025		44,953
2026		39,789
Thereafter		133,835
Undiscounted cash flows	$	377,867
Reconciliation of lease liabilities:
Present values	$	274,310
Lease liabilities - current		41,697
Lease liabilities - noncurrent		232,613
Lease liabilities - total	$	274,310
Difference between undiscounted and discounted cash flows	$	103,557

The Company has excluded in the table above approximately $24.0 million of leases (undiscounted basis) that were entered into as of June 1, 2022. These leases will commence in 2022 and 2023 with lease terms of 10 years.