Leases

12 Months Ended

Dec. 31, 2020

The Company's leases consist primarily of operating leases for buildings, equipment and vehicles. Finance leases are immaterial. The ROU asset and the lease liability are calculated based on the remaining minimum rental payments under current leasing standards for existing operating leases. The reduction in the carrying amount of the ROU asset and changes in the lease liability are presented within "Operating activities" on the Consolidated Statements of Cash Flows. We elected the package of practical expedients, which permitted us to not reassess our prior conclusions about lease identification, lease classification and initial direct costs under the new standard. We did not elect the use of the hindsight practical expedient or the practical expedient pertaining to land easements, as the latter was not applicable to us. We also elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, we did not recognize ROU assets or lease liabilities. The Company elected the practical expedient to not separate lease and non-lease components for our real estate and vehicle leases.

The Company's various noncancellable operating leases for buildings, equipment and vehicles terminate through 2030. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. As of December 31, 2020 and 2019, the leases had a weighted-average remaining lease term of 7.3 years and 6.2 years,

respectively. As most of our leases do not provide an implicit rate, the Company utilized the portfolio approach in determining the discount rate. The portfolios were grouped based on lease type and geographical location. The Company considered the most relevant major interest rate in the specific geographical location such as the Prime Rate in the U.S. and U.K. or the collateralized interest rate for non-financial institutions of the European Central Bank. These rates were then adjusted for the Company's specific credit ratings or economic conditions and lease terms of the specific portfolio. As of December 31, 2020 and 2019, the weighted-average discount rate was 5.7% and 5.4%, respectively.

The Company recognizes rent expense for operating leases under the straight-line method over the term of the lease where differences between the monthly cash payments and the lease expense are offset to the ROU asset on the Consolidated Balance Sheets. Lease expense for buildings and equipment is included within "Occupancy, equipment and supplies" on the Consolidated Statements of Operations, while lease expense for our vehicles is included within "Compensation and benefits." Some of the Company's building leases include rent expense that is associated with an index or a rate. Subsequent changes from the original index or rate would be treated as variable lease expense. Furthermore, future changes to the non-lease components of our real estate and vehicle leases will be treated as variable lease expenses.

The following table is a summary of the Company's lease expense for its operating leases for the year ended December 31:


(Amounts in millions)	2020		2019
Buildings, equipment and vehicle leases	$	15.0	$	15.8
Short-term and variable lease cost	1.2		1.7
Total lease cost	$	16.2	$	17.5

The Company's rent expense, net of sublease agreements, for the year ended December 31, 2018 was $18.3 million.

Supplemental cash flow information related to leases was as follows for the year ended December 31:


(Amounts in millions)	2020		2019
Cash paid for amounts included in the measurement of operating lease liabilities	$	15.3	$	15.8
ROU assets obtained in exchange for lease obligations	15.0		11.6

Maturities of operating lease liabilities as of December 31, 2020 were as follows:


(Amounts in millions)	Future Minimum Lease Payments
2021	$	14.0
2022	10.5
2023	7.9
2024	7.9
2025	7.6
Thereafter	25.4
Total	73.3
Less: present value discount	(14.2)
Lease liability - operating	$	59.1