17. LEASES
We have operating leases and to a lesser extent finance leases, for buildings, vehicles and equipment. Our leases have remaining lease terms of 1 year to 16 years, which includes our determination to exercise renewal options.
The components of lease expense were as follows (in millions):
| | | | | | | | | | | |
| Year Ended December 31, |
| 2022 | 2021 | 2020 |
| Operating lease cost | $ | 57.5 | | $ | 53.2 | | $ | 45.4 | |
| | | |
| Finance lease cost: | | | |
| Amortization of right-to-use assets | $ | 0.4 | | $ | 0.5 | | $ | 0.6 | |
| Interest on lease liabilities | 0.8 | | 0.8 | | 0.8 | |
| Total finance lease cost | $ | 1.2 | | $ | 1.3 | | $ | 1.4 | |
| | | |
| Sublease income | $ | 3.0 | | $ | 3.0 | | $ | 3.0 | |
The sublease is for a building with a term that ends in 2025, with no options to extend or renew.
Operating lease cost includes original reduction in the carrying amount of right-of-use assets, the impact of remeasurements, modifications, impairments and abandonments.
Our short-term leases are expensed as incurred, reflecting leases with a lease term of one year or less, and are not significant for the years ended December 31, 2022, 2021 and 2020. Operating lease variable cost is primarily comprised of reimbursed actual common area maintenance, property taxes and insurance, which are immaterial for the years ended December 31, 2022, 2021 and 2020.
Supplemental cash flow information related to leases were as follows (in millions):
| | | | | | | | | | | |
| Year Ended December 31, |
| 2022 | 2021 | 2020 |
| Cash paid for amounts included in the measurement of lease liabilities: | | | |
| Operating cash flows from operating leases | $ | 38.1 | | $ | 40.7 | | $ | 44.4 | |
| Operating cash flows from finance leases | $ | 0.8 | | $ | 0.5 | | $ | 0.6 | |
| Financing cash flows from finance leases | $ | 0.4 | | $ | 0.8 | | $ | 0.8 | |
| | | |
| Right-of-use assets obtained in exchange for lease obligations: | | | |
| Operating leases | $ | 21.2 | | $ | 45.5 | | $ | 16.1 | |
| Finance leases | $ | 0.1 | | $ | — | | $ | 0.4 | |
Supplemental balance sheet information related to leases were as follows (in millions):
| | | | | | | | |
| December 31, |
| 2022 | 2021 |
| Operating Leases | | |
| Operating lease right-of-use assets | $ | 181.0 | | $ | 204.8 | |
| | |
| Current operating lease liabilities | $ | 36.3 | | $ | 36.4 | |
| Operating lease liabilities | 153.6 | | 175.9 | |
| Total operating lease liabilities | $ | 189.9 | | $ | 212.3 | |
Finance leases are included in Property, plant and equipment, Current maturities of long-term debt, and Long-term debt and notes payable, net of current maturities.
| | | | | | | | |
| December 31, |
| 2022 | 2021 |
| | |
| Finance Leases | | |
| Property, plant and equipment, gross | $ | 11.9 | | $ | 11.8 | |
| Less: accumulated depreciation and amortization | (5.5) | | (5.1) | |
| Property, plant and equipment, net | $ | 6.4 | | $ | 6.7 | |
| | |
| Current maturities of long-term debt and notes payable | $ | 0.5 | | $ | 0.5 | |
| Long-term debt, net of current maturities | 10.1 | | 10.5 | |
| Total finance lease liabilities | $ | 10.6 | | $ | 11.0 | |
| | | | | | | | |
| December 31, |
| 2022 | 2021 |
| Weighted Average Remaining Lease Term | | |
| Operating leases - in years | 7 | 8 |
| Finance leases - in years | 15 | 15.5 |
| | |
| Weighted Average Discount Rate | | |
| Operating leases | 3.0 | % | 3.3 | % |
| Finance leases | 6.3 | % | 6.3 | % |
Maturities of lease liabilities were as follows (in millions):
| | | | | | | | | | | |
| Year Ending December 31, | Operating Leases | | Finance Leases |
| 2023 | $ | 43.6 | | | $ | 1.2 | |
| 2024 | 36.3 | | | 1.2 | |
| 2025 | 32.5 | | | 1.1 | |
| 2026 | 25.8 | | | 1.1 | |
| 2027 | 20.7 | | | 1.0 | |
| Thereafter | 57.5 | | | 11.9 | |
| Total lease payments | 216.4 | | | 17.5 | |
| Less imputed interest | (26.5) | | | (6.9) | |
| Total | $ | 189.9 | | | $ | 10.6 | |
The value of our operating lease portfolio is principally for facilities with longer durations than the lesser value vehicles and other equipment with shorter terms and higher-turn over.
As of December 31, 2022, operating leases that have not commenced are not material.