CONAGRA BRANDS INC. Leases Disclosure
15. LEASES
We have operating and finance leases of certain warehouses, plants, land, office space, production and distribution equipment, automobiles, and office equipment. We determine whether an agreement is or contains a lease at lease inception. Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.
As most of our leases do not provide an implicit interest rate, we calculate the lease liability at lease commencement as the present value of unpaid lease payments using our estimated incremental borrowing rate. The incremental borrowing rate represents the rate of interest that we would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term and is determined using a portfolio approach based on information available at the commencement date of the lease.
We have elected not to separate lease and non-lease components of an agreement for all underlying asset classes prospectively from the ASU 2016-02, Leases, Topic 842 adoption date.
Any lease arrangements with an initial term of twelve months or less are not recorded on our Consolidated Balance Sheet. We recognize lease cost for these lease arrangements on a straight-line basis over the lease term.
Our lease terms may include options to extend or terminate the lease. We consider these options in determining the lease term used to establish our ROU asset and lease liabilities. A limited number of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
Leases reported in our Consolidated Balance Sheets were as follows, excluding balances related to assets and liabilities classified as held for sale:
Operating Leases | ||||||||
| Balance Sheet Location | | May 31, 2026 | | May 25, 2025 | |||
ROU assets, net | $ | 170.7 | $ | 209.7 | ||||
Lease liabilities (current) | 36.0 | 39.7 | ||||||
Lease liabilities (noncurrent) | 170.7 | 203.3 | ||||||
Finance Leases | ||||||||
| Balance Sheet Location | | May 31, 2026 | | May 25, 2025 | |||
ROU assets, at cost | Property, plant and equipment | $ | 320.9 | $ | 364.9 | |||
Less accumulated depreciation | Less accumulated depreciation | (94.0) | (98.3) | |||||
ROU assets, net | 226.9 | 266.6 | ||||||
Lease liabilities (current) | 16.1 | 29.4 | ||||||
Lease liabilities (noncurrent) | 224.3 | 237.8 | ||||||
The components of total lease cost were as follows:
| 2026 | | 2025 | | 2024 | ||||
Operating lease cost | $ | 48.1 | $ | 47.6 | $ | 53.1 | |||
Finance lease cost | |||||||||
Depreciation of leased assets | 21.1 | 23.4 | 23.2 | ||||||
Interest on lease liabilities | 13.3 | 13.7 | 12.0 | ||||||
Short-term lease cost | 10.2 | 7.9 | 11.2 | ||||||
Total lease cost | $ | 92.7 | $ | 92.6 | $ | 99.5 | |||
The weighted-average remaining lease terms and weighted-average discount rate for our leases as of May 31, 2026 and May 25, 2025 were as follows:
Operating Leases | Finance Leases | |||||||
| 2026 | | 2025 | | 2026 | | 2025 | |
Weighted-average remaining lease term (in years) | 6.3 | 6.8 | 13.5 | 13.8 | ||||
Weighted-average discount rate | 4.35% | 4.15% | 5.33% | 5.26% | ||||
Cash flows arising from lease transactions were as follows:
| 2026 | | 2025 | | 2024 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | |||||||||
Operating cash outflows from operating leases | $ | 55.2 | $ | 51.0 | $ | 52.1 | |||
Operating cash outflows from finance leases | 13.3 | 13.7 | 5.8 | ||||||
Financing cash outflows from finance leases | 31.0 | 31.3 | 22.7 | ||||||
ROU assets obtained in exchange for new lease liabilities: | |||||||||
Operating leases | 6.3 | 77.3 | 27.5 | ||||||
Finance leases | 4.3 | 24.0 | 177.3 | ||||||
Maturities of lease liabilities by fiscal year as of May 31, 2026 were as follows (inclusive of amounts classified as held for sale):
| Operating Leases | | Finance Leases | | Total | ||||
2027 | $ | 44.2 | $ | 28.1 | $ | 72.3 | |||
2028 | 44.2 | 28.3 | 72.5 | ||||||
2029 | 34.9 | 27.9 | 62.8 | ||||||
2030 | 28.6 | 28.8 | 57.4 | ||||||
2031 | 25.9 | 26.8 | 52.7 | ||||||
Later years | 62.5 | 206.2 | 268.7 | ||||||
Total lease payments | 240.3 | 346.1 | 586.4 | ||||||
Less: Imputed interest | (33.6) | (105.7) | (139.3) | ||||||
Total lease liabilities | $ | 206.7 | $ | 240.4 | $ | 447.1 | |||
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Jul 15, 2026 | Showing above |
| 2024 | Jul 11, 2024 | |
| 2023 | Jul 13, 2023 | |
| 2022 | Jul 21, 2022 | |
| 2021 | Jul 23, 2021 | |
| 2019 | Jul 19, 2019 | |
| 2018 | Jul 20, 2018 | |
| 2017 | Jul 21, 2017 | |
| 2016 | Jul 15, 2016 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.