Leases

12 Months Ended

Dec. 31, 2022

Leases [Abstract]

Leases

Leases

The Company’s leases have remaining terms of less than one year to 18 years, some include options to extend up to an additional 10 years, and some include options to terminate within one year.

Residual value guarantees are provided on certain vehicle operating leases. Cumulatively, these guarantees are limited to $1 million and are not included in lease liabilities as it is not currently probable that any amounts will be owed.

Components of lease expense for the year ended December 31 are as follows:

(in millions of Canadian dollars)	2022		2021
Operating lease cost	$	77	$	74
Short-term lease cost	17		16
Variable lease cost	9		5
Sublease income	(2)		(3)
Finance Lease Cost
Amortization of right-of-use assets	6		10
Interest on lease liabilities	4		10
Total lease costs	$	111	$	112

Supplemental balance sheet information related to leases is as follows:

(in millions of Canadian dollars)	Classification	2022		2021
Assets
Operating	Other assets	$	267	$	287
Finance	Properties, net book value	102		166
Liabilities
Current
Operating	Accounts payable and accrued liabilities	68		59
Finance	Long-term debt maturing within one year	8		104
Long-term
Operating	Other long-term liabilities	202		224
Finance	Long-term debt	30		36

The following table provides the Company's weighted-average remaining lease terms and discount rates:

	2022		2021
Weighted-Average Remaining Lease Term
Operating leases	5 years		6 years
Finance leases	6 years		2 years
Weighted-Average Discount Rate
Operating leases	3.20	%	3.18	%
Finance leases	6.89	%	6.96	%

Supplemental information related to leases is as follows:

(in millions of Canadian dollars)	2022		2021
Cash paid for amounts included in measurement of lease liabilities
Operating cash outflows from operating leases	$	64	$	64
Operating cash outflows from finance leases	6		10
Financing cash outflows from finance leases	104		8
Right-of-use assets obtained in exchange for lease liabilities
Operating leases	34		36
Finance leases	—		5

The following table provides the maturities of lease liabilities for the next five years and thereafter as at December 31, 2022:

(in millions of Canadian dollars)	Finance Leases		Operating Leases
2023	$	10	$	75
2024	10		62
2025	9		49
2026	9		42
2027	—		28
Thereafter	7		37
Total lease payments	45		293
Imputed interest	(7)		(23)
Present value of lease payments	$	38	$	270

Leases

Leases

The Company’s leases have remaining terms of less than one year to 18 years, some include options to extend up to an additional 10 years, and some include options to terminate within one year.

Residual value guarantees are provided on certain vehicle operating leases. Cumulatively, these guarantees are limited to $1 million and are not included in lease liabilities as it is not currently probable that any amounts will be owed.

Components of lease expense for the year ended December 31 are as follows:

(in millions of Canadian dollars)	2022		2021
Operating lease cost	$	77	$	74
Short-term lease cost	17		16
Variable lease cost	9		5
Sublease income	(2)		(3)
Finance Lease Cost
Amortization of right-of-use assets	6		10
Interest on lease liabilities	4		10
Total lease costs	$	111	$	112

Supplemental balance sheet information related to leases is as follows:

(in millions of Canadian dollars)	Classification	2022		2021
Assets
Operating	Other assets	$	267	$	287
Finance	Properties, net book value	102		166
Liabilities
Current
Operating	Accounts payable and accrued liabilities	68		59
Finance	Long-term debt maturing within one year	8		104
Long-term
Operating	Other long-term liabilities	202		224
Finance	Long-term debt	30		36

The following table provides the Company's weighted-average remaining lease terms and discount rates:

	2022		2021
Weighted-Average Remaining Lease Term
Operating leases	5 years		6 years
Finance leases	6 years		2 years
Weighted-Average Discount Rate
Operating leases	3.20	%	3.18	%
Finance leases	6.89	%	6.96	%

Supplemental information related to leases is as follows:

(in millions of Canadian dollars)	2022		2021
Cash paid for amounts included in measurement of lease liabilities
Operating cash outflows from operating leases	$	64	$	64
Operating cash outflows from finance leases	6		10
Financing cash outflows from finance leases	104		8
Right-of-use assets obtained in exchange for lease liabilities
Operating leases	34		36
Finance leases	—		5

The following table provides the maturities of lease liabilities for the next five years and thereafter as at December 31, 2022:

(in millions of Canadian dollars)	Finance Leases		Operating Leases
2023	$	10	$	75
2024	10		62
2025	9		49
2026	9		42
2027	—		28
Thereafter	7		37
Total lease payments	45		293
Imputed interest	(7)		(23)
Present value of lease payments	$	38	$	270