Leases

12 Months Ended

Jan. 01, 2022

Note 13.

Leases

Qualitative disclosures about our leases, including the significant policy elections, can be found in Note 2, Summary of Significant Accounting Policies. The quantitative disclosures are presented below.

Lease costs incurred by lease type, and/or type of payment for Fiscal 2021, 2020 and 2019 were as follows (in thousands):

	Fiscal 2021		Fiscal 2020		Fiscal 2019
Lease cost:
Amortization of right-of-use assets	$	1,751	$	7,190	$	7,014
Interest on lease liabilities		154		846		994
Operating lease cost		68,927		69,926		69,525
Short-term lease cost		3,075		3,058		2,630
Variable lease cost		27,120		24,815		26,359
Total lease cost	$	101,027	$	105,835	$	106,522

Other supplemental quantitative disclosures as of, and for, Fiscal 2021 and Fiscal 2020 were as follows (in thousands):

	Fiscal 2021		Fiscal 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from financing leases	$	154	$	846
Operating cash flows from operating leases	$	68,802	$	74,226
Financing cash flows from financing leases	$	1,745	$	6,715
Right-of-use assets obtained in exchange for new financing lease liabilities	$	37	$	79
Right-of-use assets obtained in exchange for new operating lease liabilities	$	55,869	$	16,022
Weighted-average remaining lease term (years):
Financing leases		2.1		3.1
Operating leases		8.3		9.4
Weighted-average IBR (percentage):
Financing leases		3.5		3.5
Operating leases		3.8		4.1

Estimated undiscounted future lease payments under non-cancelable operating leases and financing leases, along with a reconciliation of the undiscounted cash flows to operating and financing lease liabilities, respectively, as of January 1, 2022 (in thousands) were as follows:

	Operating lease liabilities			Financing lease liabilities
2022	$	56,925		$	1,691
2023		53,900			1,828
2024		45,269			101
2025		42,386			—
2026		28,591			—
Thereafter		127,734			—
Total minimum lease payments		354,805			3,620
Less: amount of lease payments representing interest		(57,777	)		(126	)
Present value of future minimum lease payments		297,028			3,494
Less: current obligations under leases		(46,390	)		(1,584	)
Long-term lease obligations	$	250,638		$	1,910

The following table details lease modifications and renewals and lease impairments (amounts in thousands):

	Fiscal 2021		Fiscal 2020
Lease modifications and renewals	$	46,790	$	13,818
Lease impairments		—	$	11,400
Lease terminations	$	41,610	$	14,817

During Fiscal 2021, the company purchased twenty-seven warehouses that were included in the company’s operating leased assets for $64.7 million. Two of the purchased properties were fully impaired in Fiscal 2020, resulting in the recognition of a $2.6 million gain upon completion of the purchase of these assets and this amount is included in the selling, distribution, and administrative expenses line items of the Consolidated Statements of Income. The carrying values for the remaining twenty-five leases, totaling $35.4 million, are included in the ‘Lease terminations’ line above.