LEASES
We lease various real estate, including certain operating facilities, warehouses, office space, and land. We also lease material handling equipment, vehicles, and certain other equipment. Our leases have remaining lease terms of one to 15 years.
The components of total lease costs, net, consisted of the following:
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| | For the Fiscal Year Ended May (a) |
| (in millions) | | 2025 | | 2024 | | 2023 |
| Operating lease costs | | $ | 36.2 | | | $ | 38.5 | | | $ | 35.8 | |
| Short-term and variable lease costs | | 13.5 | | | 15.6 | | | 10.4 | |
| Sublease income | | (4.3) | | | (4.7) | | | (5.0) | |
| Finance lease costs: | | | | | | |
| Amortization of lease assets | | 1.3 | | | 1.4 | | | 1.0 | |
| Interest on lease obligations | | 0.3 | | | 0.3 | | | 0.2 | |
| Total lease costs, net | | $ | 47.0 | | | $ | 51.1 | | | $ | 42.4 | |
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(a)Supply-chain-related lease costs are included in “Cost of sales,” and the remainder is recorded in “Selling, general and administrative expenses,” in our Consolidated Statements of Earnings. Interest on finance lease obligations is included in “Interest expense, net,” in our Consolidated Statements of Earnings.
Operating and finance leases, with initial terms greater than one year, were as follows:
| | | | | | | | | | | | | | | | | | | | |
| (in millions, except for lease term and discount rate amounts) | | Classification | | May 25, 2025 | | May 26, 2024 |
| Assets: | | | | | | |
| Operating lease assets | | Operating lease assets | | $ | 113.2 | | | $ | 133.0 | |
| Finance lease assets | | Property, plant and equipment, net (a) | | 2.7 | | | 3.9 | |
| Total leased assets | | | | $ | 115.9 | | | $ | 136.9 | |
| | | | | | |
| Liabilities: | | | | | | |
| Lease obligations due within one year: | | | | | | |
| Operating lease obligations | | Accrued liabilities | | $ | 23.9 | | | $ | 29.3 | |
| Finance lease obligations | | Current portion of long-term debt and financing obligations | | 1.3 | | | 1.5 | |
| Long-term lease obligations: | | | | | | |
| Operating lease obligations | | Other noncurrent liabilities | | 98.9 | | | 115.4 | |
| Finance lease obligations | | Long-term debt and financing obligations, excluding current portion | | 3.9 | | | 4.2 | |
| Total lease obligations | | | | $ | 128.0 | | | $ | 150.4 | |
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| | | | | | | | | | | | | | | | | | | | |
| Weighted-average remaining lease term - finance leases | | | | 10.5 years | | 11.0 years |
| Weighted-average remaining lease term - operating leases | | | | 6.0 years | | 6.7 years |
| Weighted-average discount rate - finance leases | | | | 3.6% | | 3.7% |
| Weighted-average discount rate - operating leases | | | | 5.4% | | 5.6% |
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(a)Finance leases are net of accumulated amortization of $9.5 million and $8.2 million at May 25, 2025 and May 26, 2024, respectively.
The maturities of our lease obligations for operating and finance leases at May 25, 2025 for the next five fiscal years and thereafter are as follows:
| | | | | | | | | | | | | | | | | | | | |
| (in millions) | | Operating
Leases | | Finance
Leases | | Total |
| 2026 | | $ | 27.4 | | | $ | 1.4 | | | $ | 28.8 | |
| 2027 | | 25.0 | | | 0.9 | | | 25.9 | |
| 2028 | | 23.8 | | | 0.3 | | | 24.1 | |
| 2029 | | 20.7 | | | 0.3 | | | 21.0 | |
| 2030 | | 19.0 | | | 0.3 | | | 19.3 | |
| Thereafter | | 28.3 | | | 3.1 | | | 31.4 | |
| Total lease payments | | 144.2 | | | 6.3 | | | 150.5 | |
| Less: Interest | | (21.4) | | | (1.1) | | | (22.5) | |
| Present value of lease obligations | | $ | 122.8 | | | $ | 5.2 | | | $ | 128.0 | |
Supplemental cash flow information related to leases was as follows:
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| | For the Fiscal Years Ended May |
| (in millions) | | 2025 | | 2024 | | 2023 |
| Cash paid for amounts included in the measurement of lease obligations: | | | | | | |
| Operating cash flows for operating leases | | $ | 27.5 | | | $ | 29.8 | | | $ | 26.2 | |
| Financing cash flows for finance leases | | 0.4 | | | 0.5 | | | 0.5 | |
| | | | | | |
| Non-cash investing and financing activities: | | | | | | |
| Operating lease assets obtained in exchange for lease liabilities | | 1.0 | | | 7.6 | | | 49.7 | |
| Operating lease assets reduced for reductions to lease liabilities | | (1.1) | | | (0.6) | | | (5.1) | |
| Finance lease assets obtained in exchange for lease liabilities | | 0.5 | | | 0.4 | | | 0.5 | |