NOTE 11: LEASES
Our lease costs and other information related to operating leases consisted of the following:
| | | | | | | | | | | | | | | | | | | | |
| | | | | | (dollars in 000s) |
| Year ended June 30, | | 2025 | | 2024 | | 2023 |
| Operating lease costs | | $ | 244,127 | | | $ | 242,372 | | | $ | 238,899 | |
| Variable lease costs | | 93,216 | | | 88,629 | | | 85,239 | |
| Subrental income | | (464) | | | (508) | | | (575) | |
| Total lease costs | | $ | 336,879 | | | $ | 330,493 | | | $ | 323,563 | |
| | | | | | |
| Cash paid for operating lease costs | | $ | 239,792 | | | $ | 239,292 | | | $ | 236,423 | |
| New operating right of use assets and related lease liabilities | | $ | 293,190 | | | $ | 266,970 | | | $ | 253,755 | |
| Weighted-average remaining operating lease term (years) | | 3 | | 3 | | 2 |
| Weighted-average operating lease discount rate | | 5.0% | | 5.0% | | 4.1% |
| | | | | | |
Aggregate operating lease maturities as of June 30, 2025 are as follows:
| | | | | | | | |
| | (in 000s) |
| | |
| 2026 | | $ | 230,102 | |
| 2027 | | 166,425 | |
| 2028 | | 102,033 | |
| 2029 | | 45,036 | |
| 2030 | | 19,309 | |
| 2031 and thereafter | | 11,898 | |
| Total future undiscounted operating lease payments | | 574,803 | |
| Less imputed interest | | (42,753) | |
| Total operating lease liabilities | | $ | 532,050 | |
| | |
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.