Leases

12 Months Ended

Oct. 31, 2020

LEASES

The Company leases certain buildings, warehouses, land, transportation equipment, operating equipment, and office equipment with remaining lease terms from less than 1 year up to 22 years. The Company reviews all options to extend, terminate, or purchase a right of use asset at the time of lease inception and accounts for options deemed reasonably certain.

The Company combines lease and non-lease components for all leases, except real estate, for which these components are presented separately. Leases with an initial term of twelve months or less are not capitalized and are recognized on a straight-line basis over the lease term. The implicit rate is not readily determinable for substantially all of the Company's leases, therefore the initial present value of lease payments is calculated utilizing an estimated incremental borrowing rate determined at the portfolio level based on market and Company specific information.

Certain of the Company’s leases include variable costs. As the right of use asset recorded on the balance sheet was determined based upon factors considered at the commencement date, changes in these variable expenses are not capitalized and are expensed as incurred throughout the lease term.

As of October 31, 2020, the Company has not entered into any significant leases which have not yet commenced.

The following table presents the balance sheet classification of the Company’s lease assets and liabilities as of October 31, 2020:


(in millions)	Balance Sheet Classification	October 31, 2020
Lease Assets
Operating lease assets	Operating lease assets	$	307.5
Finance lease assets	Other long-term assets	4.6
Total lease assets		$	312.1

Lease Liabilities
Current operating lease liabilities	Current portion of operating lease liabilities	$	52.3
Current finance lease liabilities	Other current liabilities	1.7
Total current lease liabilities		54.0

Non-current operating lease liabilities	Operating lease liabilities	257.7
Non-current finance lease liabilities	Other long-term liabilities	2.9
Total non-current lease liabilities		260.6
Total lease liabilities		$	314.6

The following table presents the lease expense components:


	Year Ended
(in millions)	October 31, 2020
Operating lease cost	$	67.0
Finance lease cost	1.4
Variable lease cost*	25.4
Total lease cost	$	93.8

*Amount includes short-term lease costs.

Future maturity for the Company's lease liabilities, during the next five years, and in the aggregate for the years thereafter, are as follows:


(in millions)	Operating Leases		Finance Leases		Total expected payments
2021	$	65.6	$	1.4	$	67.0
2022	63.1		1.4		64.5
2023	55.1		1.1		56.2
2024	47.4		0.9		48.3
2025	38.8		0.5		39.3
Thereafter	171.8		0.3		172.1
Total lease payments	$	441.8	$	5.6	$	447.4
Less: Interest	(131.8)		(1.0)		(132.8)
Lease liabilities	$	310.0	$	4.6	$	314.6

The following table presents the weighted-average lease term and discount rate as of October 31, 2020:


Weighted-average remaining lease term (years):
Operating leases	11.1
Finance leases	3.6
Weighted-average discount rate:
Operating leases	3.63	%
Finance leases	3.32	%

The following table presents other required lease related information:


(in millions)	October 31, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used for operating leases	$	69.4
Financing cash flows used for finance leases	1.3
Leased assets obtained in exchange for new operating lease liabilities	67.4
Leased assets obtained in exchange for new finance lease liabilities	0.4

In compliance with ASC 842, the Company must provide the prior year disclosures required under the previous lease guidance for comparative periods presented herein.

The table below contains information related to the Company’s rent expense as disclosed within the 10-K for the period ended October 31, 2019:


	Year Ended October 31,
(in millions)	2019		2018		2017
Rent Expense	$	86.2	$	47.1	$	41.0

The following table provides the Company’s minimum rent commitments under operating leases in the next five years and the remaining years thereafter:


(in millions)	Operating Leases		Capital Leases
Year(s):
2021	$	64.8	$	1.8
2022	57.0		1.6
2023	48.7		1.3
2024	40.1		1.0
2025	31.6		0.6
Thereafter	117.5		0.3
Total	$	359.7	$	6.6