Annual report pursuant to Section 13 and 15(d)

Leases

v3.20.4
Leases
 12 Months Ended
Dec. 31, 2020
Leases [Abstract]  
Leases
NOTE 9—LEASES
The components of lease cost consisted of the following:
Year Ended December 31,
(in thousands) 2020 2019
Operating lease cost(1)
$ 104,906  $ 78,609 
Variable lease cost(1)
58,391  60,085 
Short term lease cost(1)
9,600  9,013 
$ 172,897  $ 147,707 
(1) For the year ended December 31, 2018, prior to the adoption of ASC 842 on January 1, 2019, rent expenses of $143.9 million and $1.6 million was included in SG&A expense and Cost of sales, respectively.
For the year ended December 31, 2020, operating lease cost included $16.5 million of accelerated amortization for retail locations that permanently closed during 2020 for which the related lease liabilities have not been extinguished as of December 31, 2020 due to ongoing negotiations with the landlords. In addition, for the year ended December 31, 2020, operating lease cost included $7.0 million of right-of-use asset impairment charges related to underperforming retail locations primarily in the U.S. segment for the year ended December 31, 2020. There was no impairment recorded for the year ended December 31, 2019.
In the periods presented, lease concessions reducing variable lease expense were not material.
The following table presents supplemental cash flow information:
Year Ended December 31,
(in thousands) 2020 2019
Cash paid for amounts included in the measurement of operating lease liabilities $ 82,083  $ 77,350 
Operating lease liabilities arising from obtaining ROU assets(1)(2)
22,416  471,396 
Reductions to ROU assets resulting from reductions to operating lease liabilities 6,400  783 
(1) The year ended December 31, 2019 reflects the impact from amount initially capitalized in conjunction with the adoption of ASC 842.
(2) Includes amounts added to the carrying amount of lease liabilities resulting from lease modifications and reassessments.
The following table presents supplemental balance sheet information related to leases:
Year Ended December 31,
2020 2019
Weighted average remaining lease term 6.16 years 6.79 years
Weighted average discount rate 3.72  % 3.82  %
The following table presents the future maturities of liabilities as of December 31, 2020:
(in thousands)
2021 $ 92,756 
2022 73,936 
2023 66,328 
2024 58,726 
2025 51,134 
Thereafter 130,429 
Total lease payments 473,309 
Less: imputed interest (54,662)
Total lease liabilities 418,647 
Less: current obligations (65,466)
Long-term lease obligations $ 353,181 
As of December 31, 2020, the Company has additional operating lease commitments that have not yet commenced of $3.9 million. These leases will commence in 2021 with lease terms of approximately two to 10 years.