Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

Leases

The Company’s leases have remaining terms of less than one year to 17 years. Residual value guarantees are also 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 included in the Consolidated Statements of Income for the years ended December 31 are as follows:

(in millions of Canadian dollars)	2023		2022		2021
Operating lease cost	$	94	$	77	$	74
Short-term lease cost	29		17		16
Variable lease cost	10		9		5
Sublease income	(1)		(2)		(3)
Finance lease cost
Amortization of ROU assets	10		6		10
Interest on lease liabilities	2		4		10
Total lease costs	$	144	$	111	$	112

ROU Assets and Lease Liabilities included in the Consolidated Balance Sheet are as follows:

As at December 31 (in millions of Canadian dollars)	Classification	2023		2022
ROU Assets
Operating leases	Other assets (long-term)	$	347	$	267
Finance leases	Properties	111		102
Lease Liabilities
Current liabilities
Operating leases	Accounts payable and accrued liabilities	102		68
Finance leases	Long-term debt maturing within one year	14		8
Long-term liabilities
Operating leases	Other long-term liabilities	242		202
Finance leases	Long-term debt	31		30

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

	2023		2022
Weighted-Average Remaining Lease Term
Operating leases	5 years		5 years
Finance leases	4 years		6 years
Weighted-Average Discount Rate
Operating leases	3.93	%	3.20	%
Finance leases	6.18	%	6.89	%

Cash Flow information related to leases is as follows:

As at December 31 (in millions of Canadian dollars)	2023		2022		2021
Cash paid for amounts included in measurement of lease liabilities
Operating cash outflows from operating leases	$	96	$	64	$	64
Operating cash outflows from finance leases	2		6		10
Financing cash outflows from finance leases	13		104		8
ROU assets obtained in exchange for lease liabilities
Operating leases	62		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, 2023:

(in millions of Canadian dollars)	Finance leases		Operating leases
2024	$	15	$	110
2025	14		86
2026	14		77
2027	1		50
2028	—		30
Thereafter	7		29
Total lease future payments	51		382
Imputed interest	(6)		(37)
Present value of future lease payments	$	45	$	345

Leases

Leases

The Company’s leases have remaining terms of less than one year to 17 years. Residual value guarantees are also 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 included in the Consolidated Statements of Income for the years ended December 31 are as follows:

(in millions of Canadian dollars)	2023		2022		2021
Operating lease cost	$	94	$	77	$	74
Short-term lease cost	29		17		16
Variable lease cost	10		9		5
Sublease income	(1)		(2)		(3)
Finance lease cost
Amortization of ROU assets	10		6		10
Interest on lease liabilities	2		4		10
Total lease costs	$	144	$	111	$	112

ROU Assets and Lease Liabilities included in the Consolidated Balance Sheet are as follows:

As at December 31 (in millions of Canadian dollars)	Classification	2023		2022
ROU Assets
Operating leases	Other assets (long-term)	$	347	$	267
Finance leases	Properties	111		102
Lease Liabilities
Current liabilities
Operating leases	Accounts payable and accrued liabilities	102		68
Finance leases	Long-term debt maturing within one year	14		8
Long-term liabilities
Operating leases	Other long-term liabilities	242		202
Finance leases	Long-term debt	31		30

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

	2023		2022
Weighted-Average Remaining Lease Term
Operating leases	5 years		5 years
Finance leases	4 years		6 years
Weighted-Average Discount Rate
Operating leases	3.93	%	3.20	%
Finance leases	6.18	%	6.89	%

Cash Flow information related to leases is as follows:

As at December 31 (in millions of Canadian dollars)	2023		2022		2021
Cash paid for amounts included in measurement of lease liabilities
Operating cash outflows from operating leases	$	96	$	64	$	64
Operating cash outflows from finance leases	2		6		10
Financing cash outflows from finance leases	13		104		8
ROU assets obtained in exchange for lease liabilities
Operating leases	62		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, 2023:

(in millions of Canadian dollars)	Finance leases		Operating leases
2024	$	15	$	110
2025	14		86
2026	14		77
2027	1		50
2028	—		30
Thereafter	7		29
Total lease future payments	51		382
Imputed interest	(6)		(37)
Present value of future lease payments	$	45	$	345